Relating to required disclosures regarding named driver automobile insurance policies.
Impact
The new requirements set forth in SB1095 are intended to enhance consumer protection by ensuring that applicants are adequately informed about the coverage limitations of named driver policies. This could help prevent misunderstandings and potential disputes between insurers and policyholders regarding coverage eligibility. The law aims to apply to all insurance policies that are delivered, issued, or renewed after September 1, 2015, thus updating the existing legal framework around automobile insurance in Texas.
Summary
SB1095 proposes amendments to the Texas Insurance Code regarding named driver automobile insurance policies. The bill mandates that insurance agents and companies must provide clear disclosures to applicants about the limitations of such policies. Specifically, it states that named driver policies do not cover individuals residing in the insured's household who are not explicitly named on the policy. This disclosure must occur both orally and in writing prior to the acceptance of any premiums or fees for the policy.
Contention
One point of contention surrounding SB1095 could revolve around the perceived burden it places on insurance agents and companies, as they must develop systems to ensure compliance with the new disclosure requirements. Supporters may argue that the bill bolsters customer rights and transparency, while critics might contend it could lead to increased operational costs for insurance providers, which could ultimately be passed on to consumers. Additionally, there may be discussions about balancing regulatory oversight with the need for insurance flexibility and provider viability.
Relating to nonrenewal of certain private passenger automobile insurance policies for the insured's failure to cooperate in a third-party liability claim or action.