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A BILL TO BE ENTITLED
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AN ACT
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relating to declination, cancellation, or nonrenewal of insurance |
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policies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 551.001(a), Insurance Code, is amended |
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to read as follows: |
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(a) The commissioner may, as necessary, adopt and enforce |
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reasonable rules, including notice requirements, relating to: |
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(1) the cancellation and nonrenewal of any insurance |
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policy regulated by the department under: |
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(A) [(1)] Chapter 5; |
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(B) [(2)] Chapter 1804, 1805, 2171, or 2301; or |
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(C) [(3)] Subtitle C, D, E, or F, Title 10; and |
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(2) the declination of a completed and submitted |
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application for any insurance policy regulated by the department |
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under a provision of this code listed in Subdivision (1) other than |
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a workers' compensation insurance policy. |
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SECTION 2. Section 551.002, Insurance Code, is amended by |
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amending Subsection (a) and adding Subsection (a-1) to read as |
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follows: |
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(a) The commissioner shall require an insurer that declines |
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a completed and submitted application for or cancels or refuses to |
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renew an insurance policy to which Section 551.001 applies, other |
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than a workers' compensation insurance policy [on request by an |
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applicant for insurance or a policyholder], to provide to the |
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applicant or policyholder a written statement of the reasons for |
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the declination, cancellation, or nonrenewal of the [an insurance] |
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policy [to which Section 551.001 applies]. |
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(a-1) The commissioner shall require an insurer that writes |
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workers' compensation insurance, on request by an applicant for |
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workers' compensation insurance or a policyholder, to provide to |
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the applicant or policyholder a written statement of the reasons |
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for the declination of a completed and submitted application for a |
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workers' compensation insurance policy or the cancellation or |
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nonrenewal of a workers' compensation insurance policy. |
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SECTION 3. Subchapter A, Chapter 551, Insurance Code, is |
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amended by adding Section 551.006 to read as follows: |
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Sec. 551.006. REPORT REQUIRED. (a) An insurer shall |
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provide to the department at least once each quarter a written |
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report summarizing the insurer's reasons for declination, |
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cancellation, or nonrenewal provided to applicants for insurance or |
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policyholders as required by this chapter. The report must be: |
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(1) in the form and manner prescribed by the |
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commissioner; and |
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(2) organized by the zip codes of the applicants and |
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policyholders, as applicable, that received the statement. |
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(b) The department shall post an aggregated summary of the |
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reports provided under this section on the department's Internet |
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website. The aggregated summary: |
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(1) must be organized by the zip codes of the |
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applicants and policyholders, as applicable; and |
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(2) may not identify, directly or indirectly, any |
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insurer. |
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(c) This section does not apply to reasons for declination, |
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cancellation, or nonrenewal provided to applicants for or |
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policyholders of workers' compensation insurance policies. |
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SECTION 4. Subchapter A, Chapter 551, Insurance Code, is |
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amended by adding Section 551.007 to read as follows: |
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Sec. 551.007. ELECTRONIC DELIVERY. Notwithstanding any |
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other law, an insurer may deliver notice or a written statement of a |
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declination required by this chapter by electronic means. |
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SECTION 5. The heading to Subchapter B, Chapter 551, |
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Insurance Code, is amended to read as follows: |
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SUBCHAPTER B. DECLINATION, CANCELLATION, AND NONRENEWAL OF CERTAIN |
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LIABILITY AND COMMERCIAL PROPERTY INSURANCE POLICIES |
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SECTION 6. Subchapter B, Chapter 551, Insurance Code, is |
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amended by adding Section 551.0521 to read as follows: |
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Sec. 551.0521. WRITTEN NOTICE OF DECLINATION REQUIRED. An |
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insurer that declines a completed and submitted application for a |
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liability insurance or commercial property insurance policy shall |
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deliver or mail written notice of the declination to the applicant. |
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SECTION 7. Section 551.055, Insurance Code, is amended to |
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read as follows: |
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Sec. 551.055. REASON FOR DECLINATION, CANCELLATION, OR |
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NONRENEWAL REQUIRED. In a notice to an applicant or insured |
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relating to declination, cancellation, or refusal to renew, an |
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insurer must state the reason for the declination, cancellation, or |
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nonrenewal. The statement must comply with: |
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(1) Sections 551.002(b) and (c); and |
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(2) rules adopted under Section 551.002(d). |
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SECTION 8. Section 551.109, Insurance Code, is amended to |
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read as follows: |
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Sec. 551.109. INSURER STATEMENT. An insurer shall[, at the |
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request of an applicant for insurance or an insured,] provide a |
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written statement of the reason for a declination of a completed and |
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submitted application for an insurance policy or a[,] |
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cancellation[,] or nonrenewal of an insurance policy. The |
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statement must comply with: |
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(1) Sections 551.002(b) and (c); and |
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(2) rules adopted under Section 551.002(d). |
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SECTION 9. (a) Except as provided by Subsection (b) of this |
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section, the changes in law made by this Act apply only to an |
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application for insurance that is made or an insurance policy that |
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is delivered, issued for delivery, or renewed on or after the |
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effective date of this Act. An application made or policy |
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delivered, issued for delivery, or renewed before the effective |
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date of this Act is governed by the law as it existed immediately |
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before that date, and that law is continued in effect for that |
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purpose. |
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(b) Subsection (a) of this section does not apply to Section |
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551.006, Insurance Code, as added by this Act. |
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SECTION 10. This Act takes effect March 1, 2026. |