By Flores H.B. No. 1632
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the change of the name of the Texas Catastrophe
1-3 Property Insurance Association to the Texas Windstorm Insurance
1-4 Association.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 3(2), Article 5.13-2, Insurance Code, is
1-7 amended to read as follows:
1-8 (2) "Insurer" means an insurer to which Article 5.13
1-9 of this code applies, but does not include the Texas Windstorm
1-10 [Catastrophe Property] Insurance Association. However, the
1-11 provisions of Sections 4, 5, 6, and 7 of this article shall not
1-12 apply to Lloyd's or reciprocals with respect to commercial property
1-13 insurance.
1-14 SECTION 2. Section 2, Article 21.49, Insurance Code, is
1-15 amended to read as follows:
1-16 Sec. 2. NAME OF ACT. This Act shall be known as the "Texas
1-17 Windstorm [Catastrophe Property] Insurance Association [Pool] Act."
1-18 SECTION 3. Section 3(b), Article 21.49, Insurance Code, is
1-19 amended to read as follows:
1-20 (b) "Association" means the Texas Windstorm [Catastrophe
1-21 Property] Insurance Association as established pursuant to the
1-22 provisions of this Act.
1-23 SECTION 4. The heading to Section 4, Article 21.49,
1-24 Insurance Code, is amended to read as follows:
2-1 Sec. 4. Creation of the Texas Windstorm [Catastrophe
2-2 Property] Insurance Association.
2-3 SECTION 5. The heading to Section 5, Article 21.49,
2-4 Insurance Code, is amended to read as follows:
2-5 Sec. 5. Operation of the Texas Windstorm [Catastrophe
2-6 Property] Insurance Association; Association Board of Directors.
2-7 SECTION 6. Subsection (f), Article 24.17, Insurance Code, is
2-8 amended to read as follows:
2-9 (f) Whenever a financed insurance contract is cancelled, and
2-10 the premium finance agreement contains an assignment or power of
2-11 attorney for the benefit of the premium finance company, the
2-12 insurer shall return whatever unearned premiums are due under the
2-13 insurance contract directly to the premium finance company within
2-14 60 days after the policy cancellation date. The insurer, however,
2-15 may deduct from the unearned premium returned to the premium
2-16 finance company the amount of unearned commission due from the
2-17 agent or agency writing the insurance if the insurer notifies such
2-18 agent or agency that such unearned commission should be returned to
2-19 the premium finance company. The insurer shall remit the unearned
2-20 commission to the premium finance company within 120 days of the
2-21 policy cancellation date if the agent has not returned the same to
2-22 the premium finance company within 90 days after the policy
2-23 cancellation date.
2-24 Provided, however, agents or agencies shall be liable for the
2-25 return of unearned commissions on policies written through the
2-26 Texas Windstorm [Catastrophe Property] Insurance Association, the
2-27 Texas Automobile Insurance Plan, and the Texas Medical Liability
3-1 Insurance Underwriting Association. Agents or agencies placing
3-2 business through these plans shall return the unearned commissions
3-3 to the premium finance company within 60 days after the agent or
3-4 agency has been notified of the cancellation.
3-5 The insurer, except the Texas Windstorm [Catastrophe
3-6 Property] Insurance Association, the Texas Automobile Insurance
3-7 Plan, and the Texas Medical Liability Insurance Underwriting
3-8 Association, may return the unearned premiums to the producing
3-9 agent or agency; however, the insurer shall remain liable and remit
3-10 to the premium finance company within 120 days of the policy
3-11 cancellation date if the producing agent or agency does not return
3-12 the unearned premiums to the premium finance company within 90 days
3-13 after the policy cancellation date, provided the premium finance
3-14 company complied with the provisions of Article 24.22 herein. In
3-15 the event the premium finance company fails to comply with the
3-16 provisions in Article 24.22 herein, the insurer, including the
3-17 Texas Windstorm [Catastrophe Property] Insurance Association, the
3-18 Texas Automobile Insurance Plan, and the Texas Medical Liability
3-19 Insurance Underwriting Association, may satisfy any legal
3-20 obligations it has to return the unearned premiums due under the
3-21 insurance contract to the insurance premium finance company or
3-22 returning said unearned premiums to the producing agent or agency.
3-23 SECTION 7. Article 24.22, Insurance Code, is amended to read
3-24 as follows:
3-25 Art. 24.22. EXISTENCE OF AGREEMENT; NOTIFICATION OF
3-26 INSURERS. Any premium finance company which enters into a premium
3-27 finance agreement which includes an assignment or power of attorney
4-1 shall notify either the insurer or the Texas Windstorm [Catastrophe
4-2 Property] Insurance Association, the Texas Automobile Insurance
4-3 Plan, or the Texas Medical Liability Insurance Underwriting
4-4 Association whose premiums are being financed of the existence of
4-5 such agreement and to whom the premium payment has been made.
4-6 Provided, however, the premium finance company shall notify and
4-7 fund all premiums to county mutual insurance companies unless the
4-8 premium finance company is authorized in writing by the county
4-9 mutual to notify or fund an agent or managing general agent.
4-10 Notification shall be made within 30 days of the date the agreement
4-11 is accepted by the premium finance company.
4-12 SECTION 8. The importance of this legislation and the
4-13 crowded condition of the calendars in both houses create an
4-14 emergency and an imperative public necessity that the
4-15 constitutional rule requiring bills to be read on three several
4-16 days in each house be suspended, and this rule is hereby suspended,
4-17 and that this Act take effect and be in force from and after its
4-18 passage, and it is so enacted.