By: Madla S.B. No. 984 99S0665/1 A BILL TO BE ENTITLED AN ACT 1-1 relating to insurers' written statements of the reasons for 1-2 cancellation, declination, or nonrenewal of certain insurance 1-3 policies. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Chapter 21, Insurance Code, is amended by adding 1-6 Article 21.49-2E to read as follows: 1-7 Art. 21.49-2E. REQUIREMENTS FOR WRITTEN STATEMENT OF REASON 1-8 FOR CANCELLATION, DECLINATION, OR NONRENEWAL. (a) An insurer's 1-9 written statement giving the reason or reasons for cancellation, 1-10 declination, or nonrenewal of an insurance policy required by 1-11 Articles 21.49-2, 21.49-2A, and 21.49-2B of this code shall fully 1-12 explain a decision which adversely affects an applicant or 1-13 policyholder by denying the applicant or policyholder coverage or 1-14 continued coverage, and such statements shall: 1-15 (1) refer to a specific underwriting guideline or 1-16 guidelines on file with or available to the department and the 1-17 office of public insurance counsel under Article 1.24D of this 1-18 code; 1-19 (2) state the precise risk factor or factors of the 1-20 applicant or policyholder that violate the guideline or guidelines; 1-21 (3) state the source of information the insurer relied 1-22 on regarding the risk factor or factors; and 1-23 (4) specify any other information deemed relevant by 1-24 the commissioner. 2-1 (b) The commissioner is authorized and directed to issue 2-2 rules necessary to implement this article. 2-3 SECTION 2. This Act takes effect September 1, 1999, and 2-4 applies to a cancellation, declination, or nonrenewal of an 2-5 insurance policy under Article 21.49-2E, Insurance Code, as added 2-6 by this Act, that occurs on or after January 1, 2000. A 2-7 cancellation, declination, or nonrenewal that occurs before January 2-8 1, 2000, is governed by the law as it existed immediately before 2-9 the effective date of this Act, and that law is continued in effect 2-10 for that purpose. 2-11 SECTION 3. The importance of this legislation and the 2-12 crowded condition of the calendars in both houses create an 2-13 emergency and an imperative public necessity that the 2-14 constitutional rule requiring bills to be read on three several 2-15 days in each house be suspended, and this rule is hereby suspended.