BILL ANALYSIS |
C.S.H.B. 3203 |
By: Sheets |
Insurance |
Committee Report (Substituted) |
BACKGROUND AND PURPOSE
Interested parties maintain that requiring disclosure that a named driver policy does not provide coverage for individuals residing in the insured's household that are not named on the policy at each premium payment is not feasible, especially when some automotive policies renew at frequent intervals, even monthly. The parties also contend that concurrent disclosure and signing of disclosure, which requires the policyholder to be present in the agent's office at each renewal, is not only a burden on the insurer but also the consumer. C.S.H.B. 3203 seeks to address these issues.
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CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
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RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
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ANALYSIS
C.S.H.B. 3203 amends the Insurance Code to specify that for the purposes of required disclosure regarding named driver policies, the term "named driver policy" means a personal automobile owner's insurance policy and the term does not include a named non-owner policy or operator's policy or an owner's policy that provides coverage for each individual residing in a named insured's household unless the individual is specifically excluded. The bill defines "household" for such purposes as a unit of individuals living together in the same dwelling, without regard to whether the individuals are related to each other.
C.S.H.B. 3203 specifies that an agent or insurer is required to disclose certain information to an applicant or insured before accepting the initial, instead of any, premium or fee for a named driver policy. The bill specifies that such an agent or insurer is required to make the disclosure to the applicant or insured orally or in writing, instead of both orally and in writing. The bill clarifies that the applicant or insured is not required to confirm the provision of an oral disclosure in writing at the same time as receiving the oral disclosure.
C.S.H.B. 3203 establishes that the agent or insurer is not required to provide the disclosure in or supplemental to a reinstated or renewal policy if the named insured has previously acknowledged receipt of the disclosure in connection with that policy or a personal automobile insurance policy previously issued to the insured by the same insurer or an affiliated insurer. The bill requires a signature required for a disclosure regarding a named driver policy to be an original or electronic signature executed specifically for each new policy. The bill requires an electronic signature to comply with the Uniform Electronic Transactions Act and Insurance Code provisions governing electronic transactions.
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EFFECTIVE DATE
September 1, 2015.
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COMPARISON OF ORIGINAL AND SUBSTITUTE
While C.S.H.B. 3203 may differ from the original in minor or nonsubstantive ways, the following comparison is organized and formatted in a manner that indicates the substantial differences between the introduced and committee substitute versions of the bill.
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