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A BILL TO BE ENTITLED
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AN ACT
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relating to a disclosure regarding flood coverage under a |
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commercial or 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 C, Chapter 2002, Insurance Code, is |
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amended by adding Section 2002.103 to read as follows: |
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Sec. 2002.103. DISCLOSURE REGARDING FLOOD COVERAGE |
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REQUIRED. (a) In this section: |
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(1) "Commercial property insurance" has the meaning |
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assigned by Section 2301.002, except that the term includes a |
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commercial multiperil insurance policy that provides commercial |
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property insurance coverage. |
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(2) "Residential property insurance" has the meaning |
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assigned by Section 2301.002, except that the term includes a farm |
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and ranch insurance policy and a farm and ranch owners insurance |
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policy. |
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(b) This section applies to each insurer authorized to |
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engage in the business of commercial or residential property |
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insurance in this state, including a county mutual insurance |
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company, farm mutual insurance company, Lloyd's plan, and |
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reciprocal or interinsurance exchange. |
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(c) An insurer that issues or renews a commercial or |
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residential property insurance policy that does not provide |
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coverage against loss caused by flooding shall include with the |
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policy documents provided to the policyholder at the time the |
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policy is issued or renewed the following statement: |
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"Flood Insurance: You may also need to consider the purchase |
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of flood insurance. Your insurance policy does not include coverage |
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for damage resulting from a flood even if hurricane winds and rain |
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caused the flood to occur. Without separate flood insurance |
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coverage, you may have uncovered losses caused by a flood. Please |
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discuss the need to purchase separate flood insurance coverage with |
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your insurance agent or insurance company, or visit |
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www.floodsmart.gov." |
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(d) The statement described by Subsection (c) must be |
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conspicuous, as defined by Section 1.201, Business & Commerce Code. |
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(e) An insurer's failure to comply with this section does |
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not invalidate any exclusion, including a flood exclusion, in an |
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insurance policy subject to this section. |
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SECTION 2. Section 2002.103, Insurance Code, as added by |
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this Act, applies only to an insurance policy delivered, issued for |
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delivery, or renewed on or after January 1, 2020. A policy |
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delivered, issued for delivery, or renewed before January 1, 2020, |
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is governed by the law as it existed immediately before the |
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effective date of this Act, and that law is continued in effect for |
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that purpose. |
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SECTION 3. This Act takes effect September 1, 2019. |