Texas House Bill HB2784

Texas 2009 - 81st Regular

Caption

Relating to withdrawal plans for certain insurers.

Impact

If enacted, HB2784 will significantly impact insurance practices in Texas by establishing stricter regulations on insurers that choose to withdraw from the market. This regulation intends to protect policyholders by ensuring that they have access to competitively priced insurance products. Furthermore, the bill seeks to create a more stable insurance market landscape by discouraging insurers from withdrawing, which can lead to gaps in coverage and increased costs for consumers.

Summary

House Bill 2784 aims to amend the Texas Insurance Code concerning the withdrawal plans of certain insurers, specifically targeting those that write residential property and personal automobile insurance. The bill changes the conditions under which insurers can resume writing insurance in the event of a complete withdrawal from the state. It introduces a mandatory waiting period of five years before an insurer can write insurance again unless the state insurance commissioner approves a specific line of insurance, based on availability and affordability for policyholders in the area.

Contention

There may be contention surrounding this bill as insurance companies might view the mandatory five-year waiting period and the requirement for commissioner approval as overly restrictive. Critics may argue that such regulations could hinder insurers' business strategies or financial viability, particularly during periods of market instability. Stakeholders, including industry representatives and consumer advocacy groups, are likely to engage in discussions about the balance between protecting consumers and maintaining a flexible business environment for insurers.