Texas 2015 - 84th Regular

Texas House Bill HB2175 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	84R566 PMO-D
2	2	By: Hunter H.B. No. 2175
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the operation of the Texas Department of Insurance.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Section 31.004, Insurance Code, is amended by
10	10	amending Subsection (a) and adding Subsection (a-1) to read as
11	11	follows:
12	12	(a) The Texas Department of Insurance is subject to Chapter
13	13	325, Government Code (Texas Sunset Act). Unless continued in
14	14	existence as provided by that chapter, the department is abolished
15	15	September 1, 2019 [2023].
16	16	(a-1) Notwithstanding Section 325.015, Government Code, the
17	17	legislature may not continue the department in existence for a
18	18	period that exceeds four years. The department is abolished on
19	19	September 1 of the fourth calendar year after the year in which the
20	20	department was last continued in existence by law as provided by
21	21	Chapter 325, Government Code.
22	22	SECTION 2. Subchapter C, Chapter 31, Insurance Code, is
23	23	amended by adding Section 31.040 to read as follows:
24	24	Sec. 31.040. DEFINITION. In this subchapter, "employ"
25	25	includes any arrangement under which an individual renders or
26	26	performs a service or labor for compensation, including an
27	27	individual hired on a part-time or temporary basis or a full-time or
28	28	permanent basis.
29	29	SECTION 3. Section 31.041, Insurance Code, is amended by
30	30	amending Subsections (a) and (b) and adding Subsections (d) and (e)
31	31	to read as follows:
32	32	(a) Subject to the General Appropriations Act or other law,
33	33	the commissioner shall appoint or employ deputies, assistants, and
34	34	other personnel as necessary to carry out the powers and duties of
35	35	the commissioner and the department under this code, other
36	36	insurance laws of this state, and other laws granting jurisdiction
37	37	or applicable to the department or the commissioner.
38	38	(b) A person appointed or employed under this section must
39	39	have the professional, administrative, and insurance experience
40	40	necessary to qualify the person for the position to which the person
41	41	is appointed or employed.
42	42	(d) The commissioner shall comply with Section 31.046
43	43	before appointing or employing an individual.
44	44	(e) The commissioner shall appoint or employ an individual
45	45	based primarily on criteria established by this section.
46	46	SECTION 4. Subchapter C, Chapter 31, Insurance Code, is
47	47	amended by adding Section 31.046 to read as follows:
48	48	Sec. 31.046. JUSTIFICATION FOR APPOINTMENTS AND
49	49	EMPLOYMENT. (a) The commissioner shall justify in writing the
50	50	appointment or employment of an individual as an officer or
51	51	employee of the department.
52	52	(b) The written justification described by Subsection (a)
53	53	must:
54	54	(1) demonstrate that the appointment or employment of
55	55	the individual complies with Sections 31.041 and 31.043; and
56	56	(2) disclose the departmental workload that
57	57	necessitates the creation or continuation of the position filled by
58	58	the individual.
59	59	SECTION 5. Subchapter A, Chapter 32, Insurance Code, is
60	60	amended by adding Section 32.005 to read as follows:
61	61	Sec. 32.005. RECORD OF EXPENDITURES. (a) The department
62	62	shall conspicuously post on the department's Internet website a
63	63	link to the searchable state expenditure database established by
64	64	Section 403.024, Government Code, as it relates to expenditures by
65	65	the department.
66	66	(b) The department shall conspicuously post on the
67	67	department's Internet website with respect to an expenditure listed
68	68	in the database described by Subsection (a):
69	69	(1) a copy of the contract for the expenditure; and
70	70	(2) a copy of the payee's financial statement prepared
71	71	by a certified public accountant and current at the time the
72	72	contract is executed.
73	73	SECTION 6. Section 32.102(a), Insurance Code, is amended to
74	74	read as follows:
75	75	(a) The department, in conjunction with the office of public
76	76	insurance counsel, shall establish and maintain a single Internet
77	77	website that provides information to enable consumers to make
78	78	informed decisions relating to the purchase of residential property
79	79	insurance and personal automobile insurance. The website must
80	80	include:
81	81	(1) a description of each type of residential property
82	82	insurance policy and personal automobile insurance policy issued in
83	83	this state, including a comparison of the coverage, exclusions, and
84	84	restrictions of each policy that allows a side-by-side comparison
85	85	of the features of the policy forms;
86	86	(2) a listing of each insurer writing residential
87	87	property insurance or personal automobile insurance in this state,
88	88	indexed by each county or zip code in which the insurer is actively
89	89	writing that insurance, and a profile of the insurer that includes:
90	90	(A) contact information for the insurer,
91	91	including the insurer's full name, address, and telephone number
92	92	and the insurer's fax number and e-mail address, if available;
93	93	(B) information on rates charged by the insurer,
94	94	including:
95	95	(i) sample rates for different policyholder
96	96	profiles in each county or zip code; and
97	97	(ii) the percentage by which the sample
98	98	rate has fallen or risen due to filings in the previous 12, 24, and
99	99	36 months;
100	100	(C) a list of policy forms, exclusions,
101	101	endorsements, and discounts offered by the insurer;
102	102	(D) an indication of whether the insurer uses
103	103	credit scoring in underwriting, rating, or tiering, and a link to
104	104	the insurer's credit model or a link explaining how to request the
105	105	insurer's credit model;
106	106	(E) the insurer's financial rating determined by
107	107	A. M. Best or similar rating organization and an explanation of the
108	108	meaning and importance of the rating;
109	109	(F) a complaint ratio or similar complaint rating
110	110	system for the insurer for each of the previous three years and an
111	111	explanation of the meaning of the rating system; [and]
112	112	(G) information, other than information made
113	113	confidential by law, on the insurer's regulatory and administrative
114	114	experience with the department, the office of public insurance
115	115	counsel, and insurance regulatory authorities in other states; and
116	116	(H) a list of all names under which the insurer is
117	117	doing business under the insurer's certificate of authority; and
118	118	(3) if feasible, as determined by the commissioner and
119	119	the public insurance counsel:
120	120	(A) a side-by-side comparison of credit scoring
121	121	models, including factors, key variables, and weights, of
122	122	residential property insurers in this state; and
123	123	(B) a side-by-side comparison of credit scoring
124	124	models, including factors, key variables, and weights, of private
125	125	passenger automobile insurers in this state.
126	126	SECTION 7. Chapter 32, Insurance Code, is amended by adding
127	127	Subchapter F to read as follows:
128	128	SUBCHAPTER F. TRANSPARENCY
129	129	Sec. 32.201. APPLICABILITY OF SUBCHAPTER. This subchapter
130	130	applies to residential property insurance or personal automobile
131	131	insurance policies in this state, including policies issued by a
132	132	Lloyd's plan, a reciprocal or interinsurance exchange, a county
133	133	mutual insurance company, a farm mutual insurance company, the
134	134	Texas Windstorm Insurance Association, the FAIR Plan Association,
135	135	and the Texas Automobile Insurance Plan Association.
136	136	Sec. 32.202. DEFINITIONS. In this subchapter:
137	137	(1) "Contact" means an incident of oral communication
138	138	in person, through electronic means, by telephone, or otherwise.
139	139	(2) "Individual" means a natural person, acting in an
140	140	individual capacity or representing another person or a legal
141	141	entity, including a department, agency, or officer of a state or the
142	142	federal government, a corporation, a trust, a partnership, an
143	143	interest group, or an association.
144	144	Sec. 32.203. DISCLOSURE OF CONTACT WITH COMMISSIONER. (a)
145	145	The commissioner shall, substantially contemporaneously with the
146	146	contact, conspicuously post and maintain on the department's
147	147	Internet website a written disclosure of any contact between an
148	148	individual and the commissioner if the contact:
149	149	(1) occurs while the commissioner is acting within the
150	150	course and scope of the commissioner's office as it relates to
151	151	residential property insurance or personal automobile insurance;
152	152	(2) relates to the business of residential property
153	153	insurance or personal automobile insurance; or
154	154	(3) involves an individual engaged in the business of
155	155	residential property insurance or personal automobile insurance.
156	156	(b) The disclosure required by Subsection (a) must include:
157	157	(1) the identity of each individual involved in the
158	158	contact with the commissioner, and, if acting in a representative
159	159	capacity, the identity of each person or entity represented;
160	160	(2) the date and time of the contact; and
161	161	(3) the subject matter of the contact, if known when
162	162	the contact is initiated.
163	163	(c) On conclusion of the contact, the commissioner shall
164	164	supplement the written disclosure required by Subsection (a) with a
165	165	statement of:
166	166	(1) the duration of the contact;
167	167	(2) the actual subject matter of the contact; and
168	168	(3) in detail, all information exchanged during the
169	169	contact.
170	170	(d) In disclosing the subject matter of the contact, the
171	171	commissioner shall specifically identify the order, rule, proposed
172	172	rule, bulletin, publication, rate, or procedure, or decision or
173	173	proposed decision of or action or proposed action by the
174	174	commissioner or the department, if any, that is the subject matter
175	175	of the contact.
176	176	Sec. 32.204. DISCLOSURE OF CERTAIN CONTACT WITH DEPARTMENT.
177	177	(a) With regard to a contact other than a contact described by
178	178	Section 32.203 between the department and an individual relating to
179	179	a bulletin or a proposed or adopted rule related to an insurance
180	180	policy to which this subchapter applies, the department shall,
181	181	substantially contemporaneously with the contact, conspicuously
182	182	post and maintain on the department's Internet website a written
183	183	disclosure of:
184	184	(1) the identity of each person representing the
185	185	department involved in the contact;
186	186	(2) the identity of each other individual involved in
187	187	the contact and, if acting in a representative capacity, the
188	188	identity of each person or entity represented;
189	189	(3) the date and time of the contact; and
190	190	(4) each bulletin or proposed or adopted rule that is
191	191	the subject matter of the contact, if known at the time contact is
192	192	initiated.
193	193	(b) On conclusion of the contact, the department shall
194	194	supplement the written disclosure required by Subsection (a) with a
195	195	statement of:
196	196	(1) the duration of the contact;
197	197	(2) the identification of each bulletin or proposed or
198	198	adopted rule that was the subject matter of the contact; and
199	199	(3) in detail, all information exchanged during the
200	200	contact.
201	201	Sec. 32.205. DISCLOSURE RELATING TO RULEMAKING. With
202	202	regard to a rule related to an insurance policy to which this
203	203	subchapter applies proposed or adopted by the commissioner, the
204	204	department shall include in the notice required under Section
205	205	2001.023 or 2008.053, Government Code, and any order adopting the
206	206	rule described by Section 2001.033, Government Code:
207	207	(1) all information related to the rule disclosed
208	208	under Sections 32.203 and 32.204 as of the date of the notice or
209	209	order; and
210	210	(2) a link to the department's Internet website to
211	211	provide public access to the supplemental information related to
212	212	the rule required under Sections 32.203(c) and 32.204(b).
213	213	Sec. 32.206. DISCLOSURE RELATING TO BULLETINS. The
214	214	department shall include in any bulletin related to an insurance
215	215	policy to which this subchapter applies issued by the department or
216	216	the commissioner:
217	217	(1) all information related to the bulletin disclosed
218	218	under Sections 32.203 and 32.204 as of the date of the bulletin; and
219	219	(2) a link to the department's Internet website to
220	220	provide public access to the supplemental information related to
221	221	the bulletin required under Sections 32.203(c) and 32.204(b).
222	222	Sec. 32.207. DEPARTMENT DISCLOSURES TO INSURED. (a) The
223	223	department shall prepare a written notice of a rate change for or
224	224	imposition of a surcharge on an insurance policy to which this
225	225	subchapter applies.
226	226	(b) The notice required by Subsection (a) must include:
227	227	(1) an explanation of the rate change or surcharge;
228	228	(2) a justification for the rate change or surcharge;
229	229	and
230	230	(3) an estimate of the annual change in cost to the
231	231	insured as a result of the rate change or surcharge.
232	232	(c) The department shall notify the insureds affected by the
233	233	rate change or surcharge by:
234	234	(1) having the notice prepared under Subsection (a)
235	235	published in a newspaper of general circulation in each county in
236	236	this state in which the last known address of any affected insured
237	237	is located; and
238	238	(2) mailing by first class prepaid mail the notice
239	239	prepared under Subsection (a) to each affected insured at the
240	240	insured's last known address provided by the insurer.
241	241	Sec. 32.208. PUBLIC DISCLOSURE BY DEPARTMENT. (a) The
242	242	department shall conspicuously post and maintain on the
243	243	department's Internet website a concise summary of any rate change
244	244	for or imposition of a surcharge on an insurance policy to which
245	245	this subchapter applies. The summary must disclose:
246	246	(1) the geographic or rating area affected by the
247	247	filing;
248	248	(2) the coverage and, if applicable, the change in
249	249	coverage to which the rate filing and supporting information apply;
250	250	and
251	251	(3) whether the rate filing results in an increase or
252	252	decrease of the overall rates for coverage in a specific geographic
253	253	or rating area.
254	254	(b) The department must post on the department's Internet
255	255	website the summary required by Subsection (a) not later than the
256	256	10th day after the date the rate change is effective or the
257	257	surcharge is imposed, as applicable.
258	258	Sec. 32.209. DUTIES OF INSURER. On the request of the
259	259	department, an insurer shall provide to the department any
260	260	information the department determines is reasonable or necessary to
261	261	fulfill the department's duties under this subchapter.
262	262	SECTION 8. Chapter 81, Insurance Code, is amended by adding
263	263	Section 81.005 to read as follows:
264	264	Sec. 81.005. PUBLIC DISCLOSURE BY DEPARTMENT. (a) The
265	265	department shall conspicuously post on the department's Internet
266	266	website a summary of each action imposing a sanction, penalty, or
267	267	fine, including an administrative penalty, against an insurer,
268	268	agent, or license holder. Unless the information is made
269	269	confidential by other law, the summary must disclose:
270	270	(1) the identity of the insurer, agent, or license
271	271	holder subject to the sanction, penalty, or fine;
272	272	(2) the statutory authority for the imposition of the
273	273	sanction, penalty, or fine;
274	274	(3) the grounds for the imposition of the sanction,
275	275	penalty, or fine;
276	276	(4) the amount, duration, extent, or other measure of
277	277	the sanction, penalty, or fine imposed; and
278	278	(5) whether an appeal of the sanction, penalty, or
279	279	fine has been filed.
280	280	(b) The department shall post the summary required by
281	281	Subsection (a) not later than the 10th day after the date the
282	282	sanction, penalty, or fine is imposed.
283	283	SECTION 9. (a) This Act applies to an appointment or
284	284	employment of an individual commencing on or after the effective
285	285	date of this Act. An appointment or employment commencing before
286	286	the effective date of this Act is governed by the law as it existed
287	287	immediately before the effective date of this Act, and that law is
288	288	continued in effect for that purpose.
289	289	(b) This Act applies to a contract for an expenditure
290	290	entered into on or after the effective date of this Act. A contract
291	291	entered into before the effective date of this Act is governed by
292	292	the law as it existed immediately before the effective date of this
293	293	Act, and that law is continued in effect for that purpose.
294	294	(c) This Act applies to a rate filing made or surcharge
295	295	imposed on or after the effective date of this Act. A rate filing
296	296	made or surcharge imposed before the effective date of this Act is
297	297	governed by the law as it existed immediately before the effective
298	298	date of this Act, and that law is continued in effect for that
299	299	purpose.
300	300	SECTION 10. This Act takes effect immediately if it
301	301	receives a vote of two-thirds of all the members elected to each
302	302	house, as provided by Section 39, Article III, Texas Constitution.
303	303	If this Act does not receive the vote necessary for immediate
304	304	effect, this Act takes effect September 1, 2015.