85R23830 MEW-F
By: Phillips H.B. No. 3579
Substitute the following for H.B. No. 3579:
By: Phillips C.S.H.B. No. 3579
A BILL TO BE ENTITLED
AN ACT
relating to coverage for certain water damage claims under certain
residential property insurance policies.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter A, Chapter 2002, Insurance Code, is
amended by adding Section 2002.007 to read as follows:
Sec. 2002.007. COVERAGE FOR WATER DAMAGE CLAIMS. (a) In
this section, "insurer" and "residential property insurance" have
the meanings assigned by Section 544.352.
(b) An insurer that issues a residential property insurance
policy, including an endorsement, that provides coverage for a loss
resulting from water damage may not restrict coverage or deny a
claim under the policy based on the duration of the seepage or
leakage of water if the insured:
(1) demonstrates, in good faith, that the water damage
could not have reasonably been discovered earlier; and
(2) provides prompt notice after the loss was
discovered.
(c) Nothing in this section affects a policy provision
requiring an insured to promptly take action to mitigate a loss or
further damage after the insured discovers the water damage.
(d) If an insurer requires a policyholder to provide notice
of a loss resulting from water damage within a certain time period,
the insurer must provide a written disclosure to the policyholder
that clearly describes the time period within which the
policyholder must submit a water damage claim. The insurer must
include the disclosure on the policy's declarations page or a
separate disclosure page provided to the policyholder with the
declarations page.
(e) The commissioner may adopt rules as necessary to
implement this section.
SECTION 2. Section 2002.007, Insurance Code, as added by
this Act, applies only to an insurance policy that is delivered,
issued for delivery, or renewed on or after January 1, 2018. A
policy delivered, issued for delivery, or renewed before that date
is governed by the law as it existed immediately before the
effective date of this Act, and that law is continued in effect for
that purpose.
SECTION 3. This Act takes effect September 1, 2017.