By: Walle H.B. No. 3613
A BILL TO BE ENTITLED
AN ACT
relating to the operation of the Texas Windstorm Insurance
Association.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2210.104, Insurance Code, is amended to
read as follows:
Sec. 2210.104. OFFICERS; SALARIES AND BONUSES. (a) The
board of directors shall elect from the board's membership an
executive committee consisting of a presiding officer, assistant
presiding officer, and secretary-treasurer.
(b) The association shall post on the association's
Internet website the salary of each officer of the association and
any bonuses equal to or greater than $1,000 in value paid or given
by the association to any officer, employee, vendor or contractor
of the association.
SECTION 2. Section 2210.105, Insurance Code, is amended by
amending Subsections (a) and (b) and adding Subsections (b-1) and
(e) to read as follows:
(a) Except for an emergency meeting, the association shall:
(1) notify the department not later than the 11th day
before the date of a meeting of the board of directors or of the
members of the association; and
(2) not later than the seventh day before the date of a
meeting of the board of directors, post notice of the meeting on the
association's Internet website and the department's Internet
website.
(b) Except for a closed meeting authorized by Subchapter D,
Chapter 551, Government Code, a meeting of the board of directors or
of the members of the association is open to[:
[(1) the commissioner or the commissioner's designated
representative; and
[(2)] the public.
(b-1) A meeting of the board of directors or the members of
the association, including a closed meeting authorized by
Subchapter D, Chapter 551, Government Code, is open to the
commissioner or the commissioner's designated representative.
(e) The association shall broadcast live on the
association's Internet website all meetings of the board of
directors.
SECTION 3. Section 2210.107, Insurance Code, is amended to
read as follows:
Sec. 2210.107. PRIMARY BOARD OBJECTIVES; REPORT. (a) The
primary objectives of the board of directors are to ensure that the
association:
(1) operates in accordance with this chapter and
commissioner rules;
(2) complies with sound insurance principles; and
(3) meets all standards imposed under this chapter.
(b) Not later than June 1 of each year, the association
shall submit to the commissioner, the legislative oversight board
established under Subchapter N, the governor, the lieutenant
governor, and the speaker of the house of representatives a report
evaluating the extent to which the board met the objectives
described by Subsection (a) in the 12-month period immediately
preceding the date of the report.
SECTION 4. Subchapter C, Chapter 2210, Insurance Code, is
amended by adding Section 2210.108 to read as follows:
Sec. 2210.108. OPEN MEETINGS AND OPEN RECORDS. Except as
specifically provided by this chapter or another law, the
association is subject to Chapters 551 and 552, Government Code.
SECTION 5. Section 2210.202, Insurance Code, is amended by
adding Subsection (c) to read as follows:
(c) The commissioner shall adopt rules to simplify and
streamline the process through which a person who has an insurable
interest in insurable property may apply with the association for
insurance coverage.
SECTION 6. Section 2210.203, Insurance Code, is amended by
amending Subsection (a-1) and adding Subsection (a-2) to read as
follows:
(a-1) [This subsection applies only to a structure
constructed, altered, remodeled, or enlarged on or after September
1, 2009, and only for insurable property located in areas
designated by the commissioner.] Notwithstanding Subsection (a),
if all or any part of the property to be insured [which this
subsection applies] is located in Zone A or another similar zone
with a high level of flood risk or in Zone V or another similar zone
with an additional hazard associated with storm waves, as defined
by the National Flood Insurance Program, [and if flood insurance
under that federal program is available,] the association may not
issue an insurance policy for initial or renewal coverage unless
evidence is submitted to the association that the property to be
covered under the policy is also covered by a flood insurance policy
issued under the National Flood Insurance Program. This subsection
does not apply to property for which flood insurance is not
available under the National Flood Insurance Program [is submitted
to the association].
(a-2) An agent offering or selling a Texas windstorm and
hail insurance policy [in any area designated by the commissioner
under this subsection] shall offer flood insurance coverage
required under Subsection (a-1) to a [the] prospective insured, if
that coverage is available.
SECTION 7. Section 2210.203 (c), Insurance Code, is amended
to read as follows:
(c) A policy is automatically [may be] renewed annually [on
application for renewal] as long as the property continues to be
insurable property, or until canceled as provided by Section
2210.204. The association may require evidence that the property
is covered by a flood insurance policy in accordance with the
Subsection (a-1) before the renewal is effective.
(c-2) Section 2210.203 (c), Insurance Code, as amended by
this Act, applies only to an insurance policy that is delivered,
issued for delivery, or renewed on or after January 1, 2012. A
policy delivered, issued for delivery, or renewed before January 1,
2012, is governed by the law as it existed immediately before the
effective date of the Act, and that law is continued in effect for
that purpose.
SECTION 8. The heading to Subchapter E, Chapter 2210,
Insurance Code, is amended to read as follows:
SUBCHAPTER E. INSURANCE COVERAGE; CLAIMS SETTLEMENT AND PAYMENT
SECTION 9. Subchapter E, Chapter 2210, Insurance Code, is
amended by adding Sections 2210.205, 2210.210 and 2210.211 to read
as follows:
Sec. 2210.205. REQUIRED POLICY PROVISIONS: DEADLINE FOR
FILING CLAIM. (a) A windstorm and hail insurance policy issued by
the association must require an insured to file a claim under the
policy not later than the second anniversary of the date on which
the damage or loss that is the basis of the claim occurs.
(b) The commissioner, on a showing of good cause by a person
insured under this chapter, shall extend the two-year period
described by Subsection (a)(1) for a period not to exceed 90 days.
Sec. 2210.210. COVERAGE OF CERTAIN STRUCTURES PROHIBITED.
The association may not issue coverage to a structure, regardless
of whether the structure is otherwise insurable property under this
chapter, if the structure is used as a sexually oriented business,
as defined by Section 243.002, Local Government Code.
Sec. 2210.211. PROOF OF OTHER COVERAGE REQUIRED FOR
SETTLEMENT OF CERTAIN CLAIMS. (a) This section applies only to a
claim filed under an association policy the issuance or renewal of
which, under Section 2210.203(a-1), requires evidence of coverage
by a flood insurance policy.
(b) The association may not pay or settle a claim described
by Subsection (a) unless the person filing the claim provides
evidence satisfactory to the association that, on the date of the
loss that is the basis of the claim, the property insured under the
association policy was also covered by a flood insurance policy in
the amount required for issuance or renewal of the association
policy under Section 2210.203(a-1).
SECTION 10. Section 2210.355(g), Insurance Code, is amended
to read as follows:
(g) A commission paid to an agent for an association policy
must be reasonable, adequate, not unfairly discriminatory, and
nonconfiscatory and may not exceed 10% with refund for any unearned
portion.
SECTION 12. This Act applies only to a Texas windstorm and
hail insurance policy, and a dispute arising under a Texas
windstorm and hail insurance policy, delivered, issued for
delivery, or renewed by the Texas Windstorm Insurance Association
on or after the 30th day after the effective date of this Act. A
Texas windstorm and hail insurance policy, and a dispute arising
under a Texas windstorm and hail insurance policy, delivered,
issued for delivery, or renewed by the Texas Windstorm Insurance
Association before the 30th day after the effective date of this
Act, are governed by the law in effect on the date the policy was
delivered, issued for delivery, or renewed, and the former law is
continued in effect for that purpose.
SECTION 13. The Texas Windstorm Insurance Association shall
amend the association's plan of operation to conform to the changes
in law made by this Act not later than January 1, 2012.
SECTION 14. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2011.