| 12 | | - | SECTION 1. Subchapter A, Chapter 2002, Insurance Code, is |
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| 13 | | - | amended by adding Section 2002.007 to read as follows: |
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| 14 | | - | Sec. 2002.007. COVERAGE FOR WATER DAMAGE CLAIMS. (a) In |
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| 15 | | - | this section, "insurer" and "residential property insurance" have |
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| 16 | | - | the meanings assigned by Section 544.352. |
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| 17 | | - | (b) An insurer that issues a residential property insurance |
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| 18 | | - | policy, including an endorsement, that provides coverage for a loss |
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| 19 | | - | resulting from water damage may not restrict coverage or deny a |
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| 20 | | - | claim under the policy based on the duration of the seepage or |
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| 21 | | - | leakage of water if the insured: |
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| 22 | | - | (1) demonstrates, in good faith, that the water damage |
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| 23 | | - | could not have reasonably been discovered earlier; and |
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| 24 | | - | (2) provides prompt notice after the loss was |
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| 25 | | - | discovered. |
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| 26 | | - | (c) Nothing in this section affects a policy provision |
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| 27 | | - | requiring an insured to promptly take action to mitigate a loss or |
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| 28 | | - | further damage after the insured discovers the water damage. |
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| 29 | | - | (d) If an insurer requires a policyholder to provide notice |
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| 30 | | - | of a loss resulting from water damage within a certain time period, |
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| 31 | | - | the insurer must provide a written disclosure to the policyholder |
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| 32 | | - | that clearly describes the time period within which the |
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| 33 | | - | policyholder must submit a water damage claim. The insurer must |
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| 34 | | - | include the disclosure on the policy's declarations page or a |
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| 35 | | - | separate disclosure page provided to the policyholder with the |
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| 36 | | - | declarations page. |
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| 37 | | - | (e) The commissioner may adopt rules as necessary to |
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| 10 | + | SECTION 1. Subchapter A, Chapter 2002, Insurance Code is |
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| 11 | + | amended to add the following section: |
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| 12 | + | Sec. 2002.007. Coverage for Residential Property Water |
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| 13 | + | Damage Claims. (a) If a residential property policy, including an |
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| 14 | + | endorsement, provides coverage for loss resulting from continuous |
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| 15 | + | or repeated seepage or leakage of water or steam, the policy must |
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| 16 | + | not restrict coverage, and the insurer must not deny a claim, based |
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| 17 | + | on the duration of the seepage or leakage if an insured notifies |
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| 18 | + | the insurer no later than 30 days after the loss was discovered or |
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| 19 | + | should have been discovered. |
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| 20 | + | (b) The insurer must provide a written disclosure to the |
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| 21 | + | policyholder that clearly describes the 30-day notice requirement |
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| 22 | + | in subsection (a) of this section. The insurer must include the |
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| 23 | + | disclosure on the declarations page, or a separate disclosure page |
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| 24 | + | provided to the policyholder with the declarations page. |
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| 25 | + | (c) This section applies to an insurer as defined in Section |
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| 26 | + | 544.352(2), writing residential property insurance as defined in |
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| 27 | + | Section 544.352(3) in this state. |
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| 28 | + | (d) The commissioner may adopt rules as necessary to |
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