By: Bonnen of Galveston (Senate Sponsor - Taylor) H.B. No. 1900
(In the Senate - Received from the House April 23, 2019;
April 24, 2019, read first time and referred to Committee on
Business & Commerce; May 6, 2019, reported favorably by the
following vote: Yeas 8, Nays 0; May 6, 2019, sent to printer.)
Click here to see the committee vote
A BILL TO BE ENTITLED
AN ACT
relating to replacement cost coverage in policies issued by the
Texas Windstorm Insurance Association.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 2210.207(c) and (d), Insurance Code,
are amended to read as follows:
(c) If, on the effective date of an association policy [at
the time of loss], the total amount of insurance applicable to a
dwelling is equal to 80 percent or more of the full replacement cost
of the dwelling or equal to the maximum amount of insurance
otherwise available through the association, coverage applicable
to the dwelling under the policy is extended to include the full
cost of repair or replacement, without a deduction for
depreciation.
(d) If, on the effective date of an association policy [at
the time of loss], the total amount of insurance applicable to a
dwelling is equal to less than 80 percent of the full replacement
cost of the dwelling and less than the maximum amount of insurance
available through the association, liability for loss under the
policy may not exceed the replacement cost of the part of the
dwelling that is damaged or destroyed, less depreciation.
SECTION 2. Subchapter L-1, Chapter 2210, Insurance Code, is
amended by adding Section 2210.5741 to read as follows:
Sec. 2210.5741. REPLACEMENT COST COVERAGE CLAIM
PROCESSING. (a) After the association accepts coverage for a
claim in full or in part, a claimant whose association policy
includes replacement cost coverage for the claim may request the
replacement cost payment by submitting to the association
documentation of the cost and completion of the repairs related to
the claim not later than the 545th day after the date the claimant
receives a notification under Section 2210.573(d)(1) or (2).
(b) Not later than the 30th day after the date the
association receives documentation under Subsection (a), the
association shall provide the claimant, in writing, notification
of:
(1) the amount of the replacement cost payment the
association will make; and
(2) the deadline to request appraisal under this
section.
(c) The association shall pay the amount described by
Subsection (b)(1) not later than the 10th day after the date
notification is provided under Subsection (b).
(d) If a claimant has not demanded appraisal with respect to
a claim under Section 2210.574 and the claimant disputes the
replacement cost amount the association will pay with respect to
the claim, the claimant may demand appraisal of the replacement
cost amount not later than the 30th day after the date the claimant
receives the notification under Subsection (b). A claimant may
demand appraisal under this section without regard to whether all
repairs related to the claim are complete.
(e) Except with respect to the deadlines applicable to an
appraisal under this section, the appraisal under this section
shall be conducted in the same manner as an appraisal demanded under
Section 2210.574.
(f) If a claimant's association policy includes replacement
cost coverage, the written notification provided to the claimant
under Section 2210.573(d)(1) or (2) must notify the claimant of the
deadlines under this section for:
(1) completing repairs and submitting documentation
under Subsection (a); and
(2) demanding appraisal under this section.
SECTION 3. Section 2210.581, Insurance Code, is amended by
amending Subsections (a) and (b) and adding Subsection (d) to read
as follows:
(a) Subject to Subsection (b), the commissioner, on a
showing of good cause, may by rule extend any deadline established
under this subchapter and set the number of days by which the
deadline is extended.
(b) The [With reference to claims filed during a particular
catastrophe year, the] extension of deadlines under Subsection (a)
related to claims arising from a particular storm may not exceed 120
days in the aggregate for deadlines applicable only to the
association. The limitation on extensions under this subsection
does not apply to the extension of a deadline imposed on a claimant,
or on both a claimant and the association.
(d) The commissioner shall adopt rules as necessary to
implement this section. Section 2001.0045, Government Code, does
not apply to rules adopted under this section.
SECTION 4. The changes in law made by this Act apply only to
an insurance policy delivered, issued for delivery, or renewed on
or after January 1, 2020. A policy delivered, issued for delivery,
or renewed before January 1, 2020, 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 5. This Act takes effect September 1, 2019.
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