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A BILL TO BE ENTITLED
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AN ACT
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relating to the use by certain insurers of forms that are not |
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approved by the Texas Department of Insurance. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1701.056, Insurance Code, is amended to |
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read as follows: |
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Sec. 1701.056. USE OF CERTAIN FORMS [DISAPPROVED FORM] |
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PROHIBITED. (a) An insurer may not use a form, and shall |
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immediately stop using a form, if: |
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(1) the form is not: |
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(A) approved by the commissioner under Section |
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1701.054; or |
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(B) being used in accordance with Section |
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1701.052; |
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(2) the insurer [who] receives written notice that the |
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commissioner has: |
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(A) [a form filed by the insurer has been] |
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disapproved the form; |
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(B) withdrawn approval of the form; or |
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(C) withdrawn, with respect to the form, an |
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exemption from the approval requirements under this chapter; or |
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(3) the insurer receives written notice that the |
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commissioner has conditionally approved the form but the insurer |
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has not satisfied the conditions imposed [by the commissioner shall
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immediately stop using the form]. |
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(b) An insurer may not use any language contained in a form |
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the use of which is prohibited by Subsection (a) to deny, delay, or |
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limit coverage. |
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SECTION 2. Section 1701.101, Insurance Code, is amended by |
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adding Subsection (a-1) to read as follows: |
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(a-1) The commissioner may order an insurer to make complete |
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restitution to each insured of this state who is financially |
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damaged by the insurer's use of a form in violation of Section |
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1701.056. |
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SECTION 3. Section 2301.007, Insurance Code, is amended by |
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amending Subsection (e) and adding Subsection (f) to read as |
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follows: |
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(e) An insurer may not use a form in this state, and shall |
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immediately stop using a form, if: |
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(1) the form is not approved by the commissioner or |
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considered approved under Section 2301.006; or |
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(2) the insurer receives written notice that the |
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commissioner has: |
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(A) disapproved the form; or |
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(B) withdrawn [after the commissioner
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disapproves the form or withdraws] approval of the form. |
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(f) An insurer may not use any language contained in a form |
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the use of which is prohibited by Subsection (e) to deny, delay, or |
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limit coverage. |
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SECTION 4. The change in law made by this Act applies only |
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to a form used to write a document, including a policy, contract, or |
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certificate, on or after the effective date of this Act. A form |
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used before the effective date of this Act is governed by the law as |
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it existed immediately before that date, and that law is continued |
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in effect for that purpose. |
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SECTION 5. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2015. |