83R10746 PMO-D
 
  By: Smithee H.B. No. 3694
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the operation and oversight of the Texas Windstorm
  Insurance Association and other insurance entities; increasing a
  surcharge.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 441.105(c), Insurance Code, is amended
  to read as follows:
         (c)  The commissioner shall [may] release the insurer from
  supervision if, after the hearing, it is determined that the
  insurer:
               (1)  has been rehabilitated; or
               (2)  is no longer in a condition that makes the
  insurer's continuation in business hazardous to the public or to
  the insurer's policyholders or certificate holders.
         SECTION 2.  Section 2210.107(b), Insurance Code, is amended
  to read as follows:
         (b)  Each month [Every two months], the general manager of
  the association shall submit to the board a report evaluating the
  extent to which the association met the objectives described by
  Subsection (a) in the two-month period immediately preceding the
  date of the report.
         SECTION 3.  Section 2210.204, Insurance Code, is amended by
  adding Subsection (f) to read as follows:
         (f)  An insured who without cause cancels or allows to lapse
  insurance coverage issued by the association may not subsequently
  obtain coverage from the association for the previously insured
  property until on or after the anniversary of the date the policy
  was canceled or lapsed.
         SECTION 4.  Section 2210.259(a), Insurance Code, is amended
  to read as follows:
         (a)  A noncompliant residential structure insured by the
  association as of September 1, 2009, under Section 2210.251(f) that
  had been approved for insurability under the approval process
  regulations in effect on September 1, 2009, is subject to an annual
  premium surcharge in an amount equal to 20 [15] percent of the
  premium for insurance coverage obtained through the association.  
  The surcharge under this subsection applies to each policy issued
  or renewed by the association on or after the effective date of
  Sections 5 through 49, H.B. No. 4409, Acts of the 81st Legislature,
  Regular Session, 2009, and is due on the issuance or renewal of the
  policy.
         SECTION 5.  Section 2210.363(a), Insurance Code, is amended
  to read as follows:
         (a)  The association shall [may] offer a person insured under
  this chapter an actuarially justified premium discount on a policy
  issued by the association, or an actuarially justified credit
  against a surcharge assessed against the person, other than a
  surcharge assessed under Subchapter M, if:
               (1)  the construction, alteration, remodeling,
  enlargement, or repair of, or an addition to, insurable property
  exceeds applicable building code standards set forth in the plan of
  operation; or
               (2)  the person elects to purchase a binding
  arbitration endorsement under Section 2210.554.
         SECTION 6.  Section 2210.576(b), Insurance Code, is amended
  to read as follows:
         (b)  Except as provided by Subsections (c) and (d), a
  claimant that brings an action against the association under
  Section 2210.575 may recover only:
               (1)  the covered loss payable under the terms of the
  association policy less, if applicable, the amount of loss already
  paid by the association for any portion of a covered loss for which
  the association accepted coverage;
               (2)  prejudgment interest from the first day after the
  date specified in Section 2210.5731 by which the association was or
  would have been required to pay an accepted claim or the accepted
  portion of a claim, at the prejudgment interest rate provided in
  Subchapter B, Chapter 304, Finance Code; and
               (3)  court costs and reasonable and necessary
  attorney's fees and expert witness fees.
         SECTION 7.  Sections 2152.004, 2210.005, 2210.0081, and
  2211.156, Insurance Code, are repealed.
         SECTION 8.  (a)  Section 441.105(c), Insurance Code, as
  amended by this Act, applies to a determination by the commissioner
  of insurance made on or after the effective date of this Act.  A
  determination made before the effective date of this Act is
  governed by the law as it existed immediately before the effective
  date of this Act, and that law is continued in effect for that
  purpose.
         (b)  Section 2210.204(f), Insurance Code, as added by this
  Act, applies to a cancellation or lapse of a policy on or after the
  effective date of this Act. A cancellation or lapse before the
  effective date of this Act is governed by the law as it existed
  immediately before the effective date of this Act, and that law is
  continued in effect for that purpose.
         (c)  Sections 2210.259(a) and 2210.363(a), Insurance Code,
  as amended by this Act, apply only to an insurance policy that is
  delivered, issued for delivery, or renewed on or after January 1,
  2014. A policy delivered, issued for delivery, or renewed before
  January 1, 2014, is governed by the law as it existed immediately
  before the effective date of this Act, and that law is continued in
  effect for that purpose.
         (d)  Section 2210.576(b), Insurance Code, as amended by this
  Act, applies only to an action filed on or after the effective date
  of this Act.  An action filed before the effective date of this Act
  is covered by the law in effect on the date the action was filed, and
  that law is continued in effect for that purpose.
         SECTION 9.  This Act takes effect September 1, 2013.