78R5496 PB-F

By:  Seaman                                                       H.B. No. 2160



A BILL TO BE ENTITLED

AN ACT

relating to a specialty insurance agent license for certain persons 
who rent real property for residential use.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Article 21.09, Insurance Code, is amended by 
adding Section 6 to read as follows:
	Sec. 6.  RESIDENTIAL RENTER LICENSE.  (a)  In this section:             
		(1)  "Renter's insurance" means insurance that 
provides:             
			(A)  hazard insurance coverage to residential 
tenants for loss of, or damage to, tangible personal property 
during the term of the residential rental agreement; and
			(B)  liability insurance coverage to residential 
tenants for bodily injury or property damage during the term of the 
residential rental agreement.
		(2)  "Residential landlord" means a person engaged in 
the business of leasing residential rental property owned by that 
person.  The term includes a person who leases or collects rent on 
behalf of that person, including a property management company.
		(3)  "Residential rental agreement" means a written 
agreement that sets forth the terms and conditions governing the 
use and habitation of residential rental property.  The term 
includes a lease.
		(4)  "Residential rental property" means a unit of real 
property that is rented on a periodic basis to a residential tenant 
for use as a habitation.
		(5)  "Residential tenant" means a person who obtains 
the right under a residential rental agreement to use and inhabit 
residential rental property.
	(b)  Notwithstanding any other provision of this article or 
this code, the commissioner may issue a specialty license under 
Section 1 of this article to a residential landlord who complies 
with this section only for the limited purposes set forth in this 
section.
	(c)  A residential landlord licensed under Section 1 of this 
article may act as an agent for any authorized insurer only in 
connection with the rental of residential rental property that the 
landlord leases and only with respect to:
		(1)  providing written information about renter's 
insurance to a prospective or current residential tenant;
		(2)  assisting a residential tenant in the completion 
of an application for renter's insurance;
		(3)  transmitting a residential tenant's completed 
application for renter's insurance to a licensed insurance agent or 
an insurer authorized to engage in the business of property and 
casualty insurance in this state; or
		(4)  collecting and transmitting a residential tenant's 
premium for renter's insurance to a licensed insurance agent or an 
insurer authorized to engage in the business of property and 
casualty insurance in this state.
	(d)  A residential landlord who requires a residential 
tenant to have renter's insurance as a condition of leasing the 
residential rental property is not authorized by Subsection (c) of 
this section to engage in the activities described by Subdivisions 
(1)-(4) of that subsection.  Subsection (c) of this section applies 
to a residential landlord only if:
		(1)  the renter's insurance is written through a 
general property and casualty insurance agent licensed under this 
code; and
		(2)  the residential rental agreement includes a 
conspicuous statement in boldfaced type that states substantially 
the following:
			(A)  purchase of renter's insurance is not 
required as a condition of entering into the residential rental 
agreement;
			(B)  renter's insurance coverage is available 
from other insurers and agents;
			(C)  renter's insurance coverage may be canceled 
at the option of the residential tenant, with the tenant receiving 
any refund to which the tenant is entitled;
			(D)  rates for renter's insurance coverage 
offered are not necessarily filed with, or approved by, the 
commissioner; and
			(E)  the tenant is advised to seek and obtain the 
best rates and coverage.
	(e)  If the residential landlord collects the premiums for 
renter's insurance from a residential tenant, the amount of the 
premium must be specifically stated in the tenant's residential 
property agreement.
	(f)  A residential landlord who engages in the activities 
described by Subsection (c) of this section regarding a renter's 
insurance policy may receive an administrative fee from the insurer 
that writes the insurance coverage.  The administrative fee may not 
exceed 15 percent of the premium charged for the policy.
	SECTION 2.  (a)  This Act takes effect September 1, 2003.                      
	(b)  A residential landlord is not required to be licensed as 
provided by Section 6, Article 21.09, Insurance Code, as added by 
this Act, before January 1, 2004.