Texas House Bill HB2665

Texas 2017 - 85th Regular

Caption

Relating to notification by an insurer of certain disciplinary actions imposed on the insurer for a violation of the insurance laws of another state.

Impact

If enacted, HB2665 would amend existing provisions within the Texas Insurance Code, specifically Section 81.003(b). The inclusion of disciplinary actions from other states not only fosters transparency but also empowers regulators to take timely actions if necessary. This change could potentially lead to increased scrutiny of insurance companies operating in Texas, helping to protect consumers from companies that may pose a risk due to issues arising out of state.

Summary

House Bill 2665 aims to enhance the regulatory framework surrounding insurance companies by mandating that insurers notify the Texas commissioner of any disciplinary actions taken against them in other states. Specifically, the bill requires insurers to inform the commissioner within 30 days of the suspension or revocation of their business rights, or upon receiving any order about potential license suspensions in another state. This communication is intended to ensure that Texas maintains a clear understanding of insurers' conduct across state lines, thereby safeguarding the integrity of the market and protecting consumers.

Sentiment

The sentiment around HB2665 appears to be generally supportive among regulatory bodies and consumer protection advocates, who see it as a positive step towards enhancing oversight of the insurance industry. Some industry representatives, however, may express concerns about additional reporting requirements and the implications these actions could have on operational flexibility.

Contention

While the overall sentiment seems favorable, notable points of contention could arise around the practicality of compliance for insurers and the administrative burden of increased notifications. Insurers may argue that the requirement to track and report disciplinary actions in multiple jurisdictions could be cumbersome and add to operational costs. Balancing regulatory oversight with the practicalities of business operations will likely be a significant aspect of discussions surrounding the bill.