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Amend CSSB 14, committee substitute, by striking from page 
12, line 12-14 through page 13, line 13-8, and substituting the 
following:

ARTICLE 4.  RATE ROLLBACK; RATE FILINGS
	SECTION 4.01.  Subchapter C, Chapter 5, Insurance Code, is 
amended by adding Article 5.26-1 to read as follows:
	Article 5.26-1.  Temporary Rate Rollback for Residential 
Property Insurance
	Sec. 1.  The legislature finds that:                                    
(1)  in 1999, prior to the recent rate increases, 
average homeowners policy premiums in Texas were already the 
highest in the nation and almost twice the national average;
(2)  in 2000, paid losses in the residential property 
insurance market in Texas increased significantly, due primarily to 
water and mold losses, leading insurers in that market to raise 
their rates even higher on policies issued, delivered or renewed 
after January 1, 2001;
(3)  in fact, there has been an average statewide rate 
increase of 45 percent for Texas homeowners since 2000;
(4)  this 45 percent increase in rates occurred 
despite the fact that coverage has decreased during this same 
period by 15 percent to nearly 45 percent (water and mold coverage 
has been significantly reduced, and insurers have adopted changed 
forms);
(5)  the effect of this 45 percent increase in premium 
for reduced coverage was exacerbated for many Texans by the 
increased use of age of home and credit scoring discounts, which 
caused premiums to more than double for some policyholders who did 
not fit into the insurer's preferred credit scoring classification;
(6)  Texas homeowners are paying more today for less 
coverage than they did three years ago, as present insurance rates 
have not yet decreased despite the reduction of coverage of up to 
nearly 45 percent, and even though rates increased 45 percent in 
response to risks and losses that are no longer insured;
(7)  Today, insurance companies continue to target 
rates of return which are much higher than is reasonably expected, 
in part due to the use of unreasonable profit provisions being 
loaded in the rate, and resulting in excessive rates being charged 
policy holders;
(8)  although rates should be returned to levels at or 
below those in effect on January 1, 2001, insurers have failed to 
account for the water and mold losses that will no longer be covered 
from the historical loss data on which they base their rates and are 
inappropriately selecting loss trends and underwriting profit 
provisions in the double digits as they project into the future;
(9)  while the monetary effect of coverage changes 
combined with declining losses can be actuarily determined within a 
reasonable degree of certainty, insurers will delay implementation 
of further rate reductions until they have data evidencing actual 
loss experience;
(10)  the delay in adjusting rates to reflect 
reductions in coverage will result in a windfall for the insurers, 
and this benefit should be passed on immediately to their policy 
holders; and
(11)  legislative action in the public interest and 
within the police power of the state is required to eliminate 
unnecessary delays to pass these benefits on to the insured public 
of this state.
	Sec. 2.  Notwithstanding Article 5.26 of this subchapter or 
Article 5.142 of this code, and subject to Sec. 3 of this article, 
for any form of insurance subject to this Subchapter issued or 
renewed between October 1, 2003, and September 30, 2004, each 
insurer shall reduce its rates to levels which are no greater than 
the insurer's rates for the same type of coverage which were in 
effect on January 1, 2001.  For purposes of this section, and not 
withstanding the reduced coverage, a replacement value policy is 
the same type of coverage an HO-B policy and an actual cash value 
policy is the same type of coverage an HO-A policy.
	Sec. 3.  Between October 1, 2003, and September, 2004, rates 
and premiums reduced pursuant to Section 2 of this article may be 
increased only if the commissioner finds, after affording due 
process and a hearing open to the public, that higher rates are 
required by the Texas or United States Constitution.  In that event, 
the commissioner shall permit the insurer to increase rates only to 
the minimum level required to comply with the Texas and United 
States Constitutions.
	Sec. 4.  This article applies to all insurers, including a 
reciprocal or interinsurance exchange, mutual, capital stock 
company, fraternal benefit society, farm mutual, local mutual aid 
association, county mutual insurance company, association, Lloyd's 
plan company, or other entity writing insurance covered by this 
subchapter.