By: Watson S.B. No. 736
(Smithee)
A BILL TO BE ENTITLED
AN ACT
relating to insurance rating and underwriting practices and
declinations based on certain consumer inquiries.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 544, Insurance Code, is amended by
adding Subchapter L to read as follows:
SUBCHAPTER L. CONSUMER INQUIRY
Sec. 544.551. DEFINITION. In this subchapter, "consumer
inquiry" has the meaning assigned by Section 551.113 for "customer
inquiry."
Sec. 544.552. APPLICABILITY. This subchapter applies only
to a standard fire, homeowners, or farm and ranch owners insurance
policy.
Sec. 544.553. PROHIBITION OF UNDERWRITING AND RATING
DECISIONS BASED ON CONSUMER INQUIRY. An insurer may not:
(1) use an underwriting guideline based solely on
whether a consumer inquiry has been made by or on behalf of the
applicant or insured; or
(2) charge a rate that is different from the rate
charged to other individuals for the same coverage or increase a
rate charged to an insured based solely on whether a consumer
inquiry has been made by or on behalf of the applicant or insured.
SECTION 2. The heading to Section 551.113, Insurance Code,
is amended to read as follows:
Sec. 551.113. DECLINATION, NONRENEWAL, OR CANCELLATION
PROHIBITED; CONSIDERATION OF CONSUMER INQUIRY [CERTAIN CLAIMS].
SECTION 3. Section 551.113, Insurance Code, is amended by
adding Subsection (b-1) to read as follows:
(b-1) An insurer may not consider a customer inquiry as a
basis for nonrenewal or cancellation of an insurance policy.
SECTION 4. This Act applies only to an insurance policy that
is delivered, issued for delivery, or renewed on or after the
effective date of this Act. A policy delivered, issued for
delivery, or renewed before the effective date of this Act is
governed by the law as it existed immediately before the effective
date of this Act, and that law is continued in effect for that
purpose.
SECTION 5. This Act takes effect September 1, 2013.