BILL ANALYSIS C.S.S.B. 490 By: Bivins Economic Development 2-23-95 Committee Report (Substituted) BACKGROUND Article 5.33A of the Insurance Code, originally called the "dead-bolt" law, now includes premium discounts for homeowner policy holders who have security systems placed in their homes. To receive the discount from insurers, an inspection from a certified police officer is required. Inspectors are liable for providing that service, and due to liability problems with inspectors, consumers have had difficulties receiving the premium discount. PURPOSE As proposed, C.S.S.B. 490 provides qualifications for premium reduction for homeowners insurance coverage for persons installing home security devices and allows a person to submit a certificate of installation to receive a premium discount. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 1, Article 5.33A, Insurance Code, by adding Subdivisions (4) and (5), to define "U.L." and "siren." SECTION 2. Amends Section 2, Article 5.33A, Insurance Code, to entitle a person to premium reduction for homeowners insurance coverage if that person's property, rather than that person, is found by an inspector to be in compliance with specifications under Section 6 of this article; or if the person's property is in compliance with Section 6(a)(2) of this article, the person possesses a certificate of installation issued by the installer of the electronic burglar alarm and the person furnishes the certificate to the insurer. SECTION 3. Amends Section 3(a), Article 5.33A, Insurance Code, to make a conforming change. SECTION 4. Amends Section 4(a), Article 5.33A, Insurance Code, to make a conforming change. SECTION 5. Amends Section 6(a), Article 5.33A, Insurance Code, to provide that a person's property qualifies for a homeowners insurance premium reduction if the property meets with certain minimum specifications regarding doors and windows; or the property is equipped with an electronic burglar alarm system in which the doors and windows meet certain specifications with respect to protective and security devices, the system includes a siren audible inside the house, and except where prohibited by other law or ordinance, a siren audible outside the house; all equipment, except for sirens, is U.L. or Factory Mutual Research Corporation listed, the system is monitored by a U.L. listed central station; a backup battery is included; and the equipment sales and system installation and monitoring are in compliance with the Private Investigators and Private Security Agencies Act. SECTION 6. Amends Section 7, Article 5.33A, Insurance Code, to make a conforming change. SECTION 7. Amends Section 8(a), Article 5.33A, Insurance Code, to make a nonsubstantive change. SECTION 8. Effective date: September 1, 1995. Makes application of this Act prospective from January 1, 1996. SECTION 9. Emergency clause.