78R956 AJA-D

By:  Burnam                                                       H.B. No. 1485



A BILL TO BE ENTITLED

AN ACT

relating to underwriting guidelines for residential property 
insurance.     
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter E, Chapter 21, Insurance Code, is 
amended by adding Article 21.49-2G to read as follows:
	Art. 21.49-2G.  PROHIBITED UNDERWRITING GUIDELINES FOR 
RESIDENTIAL PROPERTY INSURANCE.  (a)  In this article:
		(1)  "Insurer" means an insurer authorized to write 
residential property insurance, including a county mutual 
insurance company, a farm mutual insurance company, a Lloyd's plan, 
and a reciprocal or interinsurance exchange.
		(2)  "Residential property insurance" means property 
or property and casualty insurance covering a dwelling, including 
homeowners insurance, residential fire and allied lines insurance, 
farm and ranch insurance, and farm and ranch owners insurance.
	(b)  An insurer may not decline to issue a residential 
property insurance policy solely because the applicant  has made a 
claim under a residential property insurance policy unless, in the 
three years before the date of application, the applicant has made 
more than three claims under a residential property insurance 
policy.
	(c)  Except as provided by this subsection, an insurer may 
not decline to issue or renew a residential property insurance 
policy solely because the residence to be covered under the policy 
has been the subject of a previous water damage claim.  An insurer 
may refuse to issue or renew the policy if the insurer inspects the 
residence and determines that the damage has not been properly 
repaired according to commonly accepted residential construction 
practices.
	(d)  The commissioner may adopt rules to implement this 
article, including rules that establish guidelines under which an 
insurer may determine whether water damage has been properly 
repaired for the purposes of Subsection (c) of this article.
	SECTION 2.  This Act takes effect September 1, 2003, and 
applies only to the issuance or renewal of an insurance policy on or 
after January 1, 2004.  The issuance or renewal of an insurance 
policy before January 1, 2004, is governed by the law in effect 
immediately before the effective date of this Act, and that law is 
continued in effect for that purpose.