The proposed changes aim to improve the availability of surplus lines insurance by enabling the Texas Department of Insurance to exempt certain kinds of insurance coverage from existing requirements if it determines that there is not a reasonable or adequate market among authorized insurers. This could potentially streamline the process for obtaining these types of insurance, making it more accessible for consumers and businesses that cannot fulfill their needs through authorized insurers alone.
Summary
SB2136 is a legislative measure concerning the provision of surplus lines insurance within Texas. The bill amends Section 981.004 of the Insurance Code to authorize eligible surplus lines insurers to provide insurance coverage when the required full amount cannot be obtained from authorized insurers after a diligent effort. The bill emphasizes the necessity of placing insurance through licensed surplus lines agents and outlines conditions under which the insurance can be offered effectively.
Contention
While supporters argue that SB2136 would enhance competition among insurance providers and make it easier for citizens to access needed insurance coverage during periods when authorized insurers are not able to provide it, there could be concerns regarding the regulation and oversight of surplus lines insurers. Critics may raise questions about the protections available to consumers who rely on these insurers, particularly about their financial stability and compliance with state regulations.