88R14147 CJD-F
 
  By: Perez H.B. No. 4194
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to an appraisal procedure for disputed losses under
  certain property and casualty insurance policies.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle A, Title 10, Insurance Code, is amended
  by adding Chapter 1813 to read as follows:
  CHAPTER 1813. APPRAISAL PROCEDURES
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 1813.001.  APPLICABILITY OF CHAPTER. (a) This chapter
  applies only to an insurer writing a property or casualty insurance
  policy, including the FAIR Plan Association, the Texas Automobile
  Insurance Plan Association, a Lloyd's plan, a reciprocal or
  interinsurance exchange, a farm mutual insurance company, and a
  county mutual insurance company.
         (b)  This chapter does not apply to:
               (1)  the Texas Windstorm Insurance Association; or
               (2)  an area for which:
                     (A)  either:
                           (i)  a state of disaster has been declared
  under Section 418.014, Government Code; or
                           (ii)  a local state of disaster has been
  declared under Section 418.108, Government Code; and
                     (B)  the disaster is caused by a wildfire, flood,
  hurricane, or tornado or a wind, ice, or snow storm.
         Sec. 1813.002.  RULES. The commissioner may adopt rules
  necessary to implement this chapter.
         Sec. 1813.003.  REQUIRED POLICY PROVISION: APPRAISAL
  PROCEDURE. An insurance policy described by Section 1813.001 must
  contain an appraisal procedure that complies with this chapter.
  SUBCHAPTER B. APPRAISAL PROCEDURES
         Sec. 1813.051.  APPRAISAL DEMAND. If the policyholder and
  insurer fail to agree to the amount of a loss covered by the policy,
  the policyholder or insurer may provide a written demand for an
  appraisal to the other party.
         Sec. 1813.052.  SELECTION OF APPRAISERS. Not later than the
  20th day after the date an appraisal demand is provided under
  Section 1813.051, the policyholder and insurer shall each:
               (1)  select a competent appraiser; and
               (2)  provide written notice to the other party of the
  appraiser's identity.
         Sec. 1813.053.  APPRAISAL OF LOSS BY APPRAISERS; SELECTION
  OF UMPIRE. (a)  The appraisers shall appraise the loss that is the
  subject of the appraisal not later than the 30th day after the date
  both the policyholder and insurer have complied with Section
  1813.052.
         (b)  The appraisers may extend the deadline described by
  Subsection (a) for a period not to exceed 60 days on agreement by
  the appraisers, policyholder, and insurer.
         (c)  If the appraisers agree on the amount of the loss:
               (1)  the appraisers shall provide written notice of the
  agreement to the policyholder and insurer; and
               (2)  the agreed amount is set as the amount of the loss.
         (d)  If the appraisers fail to agree on the amount of the
  loss, the appraisers shall select a competent and impartial umpire.  
  If the appraisers do not agree on an umpire before the 20th day
  after the deadline for the appraisers to determine the amount of the
  loss under this section, a judge of a court in the county in which
  the policyholder resides shall select the umpire on the request of
  the policyholder or insurer.
         (e)  After the umpire is selected under Subsection (d), the
  appraisers shall provide written notice to the umpire that
  includes:
               (1)  the amount each appraiser sets for the loss; and
               (2)  any supporting documentation.
         Sec. 1813.054.  APPRAISAL SELECTION BY UMPIRE. (a)  The
  umpire shall determine the amount of the loss not later than the
  30th day after the date the umpire receives the notice described by
  Section 1813.053(e) by selecting one of the amounts submitted to
  the umpire.
         (b)  The umpire may extend the deadline described by
  Subsection (a) for a period not to exceed 60 days on agreement by
  the appraisers, policyholder, and insurer.
         (c)  On deciding on the amount of the loss, the umpire shall
  provide a written determination to the policyholder and insurer
  that:
               (1)  sets the amount of the loss; and
               (2)  is signed by the umpire and the appraiser whose
  appraisal amount is selected by the umpire.
         (d)  A determination provided under Subsection (c) does not
  prevent either party from pursuing its rights under the policy or
  law.
         Sec. 1813.055.  APPRAISAL EXPENSES.  The policyholder and
  insurer shall equally divide and pay the umpire's expenses, as
  applicable, and all other appraisal expenses.
         Sec. 1813.056.  EFFECT OF APPRAISAL. (a)  The appraisal does
  not affect any applicable policy terms, including deductibles.
         (b)  The actual cash value, amount of loss, or cost of repair
  or replacement under the policy determined by the appraisal
  procedure under this chapter is binding as to the policyholder and
  the insurer.  The use of the procedure is not a condition precedent
  to bringing an action for a violation of this code, for a breach of
  contract, or for any other common-law or statutory remedy.
         SECTION 2.  Chapter 1813, Insurance Code, as added by this
  Act, applies only to an insurance policy delivered, issued for
  delivery, or renewed on or after January 1, 2024.
         SECTION 3.  This Act takes effect September 1, 2023.