CHARLESTON, W.Va. -- In West Virginia and most other states, an insurer can choose not to renew people's property insurance policy if a claim is filed over weather damage.

A West Virginia Senate bill that would ban that practice was heavily debated on Monday as lobbyists for trial lawyers and the insurance industry made their cases before the Banking and Insurance Committee.

There are strict regulations governing when an insurance company can cancel a policy. Unpaid premiums and delinquent taxes can cause homeowners to lose their insurance policy.

But there are a couple of loopholes that allow insurers to, instead of canceling a policy, simply decline to renew it. Insurers can choose not to renew if they pay out two claims within a three-year period. An even broader loophole, insurers can also choose not to renew for "other valid underwriting reasons which involve a substantial increase in the risk."

The proposed bill would bar insurers from denying renewals because of any claims arising from "natural causes."

Jill Rice, president of the West Virginia Insurance Federation, said statistics show that people who file claims are far more likely to file future claims. She said it was unfair to ask all insurance customers to subsidize certain high-risk clients.

"If I have a weather-related claim that shows statistically that I am more likely to have another weather-related claim," Rice said.

Scott Blass, president of the West Virginia Association for Justice, a group of plaintiffs' lawyers, said that insurers were taking advantage of the loophole to deny renewals for people who filed legitimate claims.

"They consider it a substantial underwriting risk if somebody makes a claim," Blass said. "People have been insured for 25-30 years. They have one claim, a hailstorm, a windstorm, something they have no control over. What happens to these people because they are non-renewed? When they go into the market it is virtually impossible to get replacement coverage."

Some senators thought that adding more regulations to insurance companies could cause them to leave the state, leading to less competition in the market.

"My concern is if we keep putting in all these limitations we'll have less companies wanting to do business here," said Sen. Brooks McCabe, D-Kanawha. "What we really want is as many companies as we can."

Sen. Mike Hall, R-Putnam, co-owns an insurance agency and objected to the increased regulation.

"My sense is that this puts a restriction on underwriting," Hall said. "That's not good and doesn't send a good message to the insurance business."

Asked directly by a senator whether he thought the bill was a good idea, West Virginia Insurance Commissioner Mike Riley demurred, saying it was well intended. Pressed for his opinion, Riley said that he thought the bill was unnecessary.

"I think it's a bad idea," Riley said. "Overall I think the current laws and statutes have proven to be effective."

Riley said that non-renewals were rare in the state and he didn't think it was an issue.

Blass disagreed, saying that he has gotten lots of calls over the last 10 to 15 years from people who have had their policies not renewed and are looking for recourse. Blass said that 15 other states have provisions that protect policyholders.

Sen. Douglas Facemire, D-Braxton, said that the status quo was unjust.

"To be penalized because we used this insurance during a natural disaster does not seem fair," Facemire said. "We're talking about things that are completely out of the hands of the insured here."