Relating to named driver insurance policies and certain related exclusions.
The bill amends Chapter 1952 of the Insurance Code, adding a new subchapter that addresses named driver exclusions and policies. Under the provisions of SB1755, insurance companies may still use named driver exclusions but must specifically name each excluded driver without excluding a class of drivers. This change may greatly affect how automobile insurance is structured in Texas, providing clearer guidelines for consumers regarding who is covered under their policies.
SB1755 introduces regulations concerning named driver insurance policies in Texas. The bill specifically prohibits insurance companies from delivering, issuing, or renewing named driver policies, which provide coverage exclusively for designated drivers rather than for all individuals residing in an insured's household. This legislative change aims to enhance consumer protection by ensuring better coverage options for drivers and reducing potential liability gaps that could arise from exclusions within such insurance policies.
During discussions of the bill, there was some contention regarding whether the prohibition of named driver policies could lead to unintended consequences for both consumers and insurers. Supporters argue that this bill is essential for preventing confusion among policyholders about who is covered, thus promoting fairness and transparency in the insurance market. Opponents express concerns that eliminating named driver policies could limit options for consumers who seek more affordable car insurance solutions tailored to their specific circumstances, particularly for occasional drivers who may only need coverage for certain individuals.