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Senate Bill 425 |
Senate Author: Carona et al. |
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Effective: 9-1-11 |
House Sponsor: Hancock |
Senate Bill 425 amends provisions of the Insurance Code relating to property and casualty certificates of insurance issued on property or casualty operations or a risk located in Texas and the approval of property and casualty certificate of insurance forms by the Texas Department of Insurance (TDI). The bill prohibits a person, property or casualty insurer, or agent, as applicable, from using or issuing a certificate of insurance, changing a previously approved certificate of insurance form, or changing the insurance coverage referenced on the certificate unless the form or change has been filed with and approved by TDI. The bill prescribes the statements to be included on a certificate of insurance form and sets out related provisions for form approval. The bill prohibits a certificate of insurance from conveying new or additional rights beyond what the referenced policy or any executed endorsement of insurance provides.
Senate Bill 425 authorizes the commissioner of insurance, if the commissioner has reason to believe that an insurer or agent has violated or is threatening to violate the bill's provisions or a related rule, to issue a cease and desist order; seek an injunction; request that the attorney general recover a civil penalty; impose sanctions on the insurer or agent; or take any combination of those actions. The bill sets out provisions relating to a hearing on whether to issue a cease and desist order and the penalties to which a person who engages in prohibited acts is subject. The bill authorizes the commissioner to adopt rules and authorizes TDI to collect a fee for the filing of a certificate of insurance.