83R1180 KKR-F
By: Davis S.B. No. 600
A BILL TO BE ENTITLED
AN ACT
relating to premium refunds for insurance rates found to be
excessive or unfairly discriminatory; providing an administrative
penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2254.003(b), Insurance Code, is amended
to read as follows:
(b) Except as provided by Section 2254.004(c), if the
commissioner determines that an insurer has charged a rate for
personal automobile insurance or residential property insurance
that is excessive or unfairly discriminatory, as described by
Section 2251.051, the commissioner shall [may:
[(1)] order the insurer to refund directly to each
affected policyholder the portion of the premium, plus interest on
that amount, that is excessive or unfairly discriminatory[, if that
portion of the premium is at least 7.5 percent of the total premium
charged for the coverage; or
[(2) if that portion of the premium is less than 7.5
percent of the total premium, order the insurer to provide, to each
affected policyholder:
[(A) who renews the policy, a future premium
discount equal to the amount of the excessive or unfairly
discriminatory portion of the premium, plus interest on that
amount; and
[(B) who does not renew or whose coverage is
otherwise terminated, a refund in the amount described by
Subdivision (1)].
SECTION 2. Chapter 2254, Insurance Code, is amended by
adding Section 2254.005 to read as follows:
Sec. 2254.005. ADMINISTRATIVE PENALTY. If the commissioner
determines after a hearing that an insurer has charged a rate for
personal automobile insurance or residential property insurance
that is excessive or unfairly discriminatory, as described by
Section 2251.051, the commissioner shall order the insurer to pay
an administrative penalty in the amount of $100 for each policy
delivered, issued for delivery, or renewed at the excessive or
unfairly discriminatory rate. This penalty is in addition to any
other penalties imposed under this code.
SECTION 3. The change in law made by this Act applies only
to a rate for a policy delivered, issued for delivery, or renewed on
or after the effective date of this Act. A rate for a policy
delivered, issued for delivery, or renewed before the effective
date of this Act is governed by the law in effect immediately before
the effective date of this Act, and that law is continued in effect
for that purpose.
SECTION 4. This Act takes effect September 1, 2013.