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A BILL TO BE ENTITLED
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AN ACT
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relating to denial or reduction of certain claims under a |
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residential property insurance policy. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter A, Chapter 2002, Insurance Code, is |
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amended by adding Section 2002.007 to read as follows: |
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Sec. 2002.007. DENIAL OR REDUCTION OF CLAIM BEFORE |
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DISCOVERY PROHIBITED. (a) A residential property insurance policy |
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must contain a provision that prohibits the denial of a claim for |
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loss or damage to property or the reduction in the amount paid under |
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the claim if: |
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(1) the loss or damage is not obvious or readily |
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apparent to the insured; and |
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(2) the denial or reduction is based on the insured's |
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failure to file the claim before the insured: |
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(A) discovers the loss or damage; or |
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(B) reasonably should have discovered the loss or |
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damage described by Paragraph (A). |
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(b) A residential insurance policy may contain a provision |
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that requires an insured to report a claim described by Subsection |
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(a)(1) within a reasonable period, as determined by the |
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commissioner, after the date the damage is discovered. |
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SECTION 2. The changes in law made by this Act apply only to |
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a residential property insurance policy delivered, issued for |
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delivery, or renewed on or after January 1, 2018. A residential |
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property insurance policy delivered, issued for delivery, or |
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renewed before January 1, 2018, is governed by the law in effect |
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immediately before the effective date of this Act, and that law is |
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continued in effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2017. |