86R5237 JES-F
By: Capriglione H.B. No. 2102
A BILL TO BE ENTITLED
AN ACT
relating to the payment of insurance deductibles related to
property insurance policies; creating criminal offenses.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle F, Title 5, Insurance Code, is amended
by adding Chapter 707 to read as follows:
CHAPTER 707. PAYMENT OF INSURANCE DEDUCTIBLE
Sec. 707.001. DEFINITIONS. In this chapter:
(1) "Person" means an individual, corporation,
association, partnership, limited liability company, or other
legal entity.
(2) "Property insurance" means insurance that
provides coverage for loss of or damage to real or personal
property.
Sec. 707.002. PAYMENT OF DEDUCTIBLE REQUIRED. A person
insured under a property insurance policy shall pay any deductible
applicable to a first-party claim made under the policy.
Sec. 707.003. CONSUMER EDUCATION. The department shall
develop and implement an education program related to the payment
of property insurance deductibles. The program must:
(1) provide reasonable methods to educate insurance
consumers and providers of goods or services that are regularly
paid for from proceeds of property insurance claims; and
(2) include materials regarding:
(A) the requirements of this chapter; and
(B) the conduct prohibited by Section 707.006.
Sec. 707.004. REQUIRED CONTRACT NOTICE. A contract to
provide a good or service that is reasonably expected to be paid
wholly or partly from the proceeds of a claim under a property
insurance policy and that has a contract price of $1,000 or more
must contain the following notice in at least 12-point boldfaced
type: "Texas law requires a person insured under a property
insurance policy to pay any deductible applicable to a claim made
under the policy. It is a violation of Texas law for a person or
business paid wholly or partly from proceeds of a property
insurance claim to knowingly allow the policyholder to fail to pay,
or assist the policyholder's failure to pay, the applicable
insurance deductible."
Sec. 707.005. PROOF OF PAYMENT. (a) This section applies
to any insurer that issues a policy providing coverage for loss of
or damage to real or personal property, including a county mutual
insurance company, a farm mutual insurance company, a reciprocal or
interinsurance exchange, or a Lloyd's plan.
(b) An insurer that issues a property insurance policy with
replacement cost coverage may refuse to pay a claim for replacement
cost under the policy until the insurer receives reasonable proof
of payment by the policyholder of any deductible applicable to the
claim.
Sec. 707.006. OFFENSES. (a) A person who sells goods or
services commits an offense if the person:
(1) advertises or promises to provide a good or
service to an insured under a property insurance policy in a
transaction in which:
(A) the good or service will be paid for by the
insured from the proceeds of a property insurance claim; and
(B) the person selling the good or service will,
without the insurer's consent:
(i) pay, waive, absorb, or otherwise
decline to charge or collect the amount of the insured's
deductible;
(ii) provide a rebate or credit in
connection with the sale of the good or service that will offset all
or part of the amount paid by the insured as a deductible; or
(iii) in any other manner assist the
insured in avoiding monetary payment of the required insurance
deductible; or
(2) provides a good or service to an insured under a
property insurance policy knowing that the insured will pay for the
good or service with the proceeds of a claim under the policy and,
without the insurer's consent:
(A) pays, waives, absorbs, or otherwise declines
to charge or collect the amount of the insured's deductible;
(B) provides a rebate or credit in connection
with the sale of the good or service that offsets all or part of the
amount paid by the insured as a deductible; or
(C) in any other manner assists the insured in
avoiding monetary payment of the required insurance deductible.
(b) A person insured under a property insurance policy
commits an offense if the person, in connection with a first-party
claim under the policy for loss of or damage to real or personal
property, knowingly:
(1) pays for a good or service with proceeds of the
claim; and
(2) without the insurer's consent:
(A) fails to pay a required insurance deductible
in connection with the claim; or
(B) accepts a rebate or credit in connection with
the purchase that offsets all or part of the amount paid by the
insured as a deductible.
(c) An offense under this section is a Class A misdemeanor.
SECTION 2. Section 27.02, Business & Commerce Code, is
repealed.
SECTION 3. The repeal by this Act of Section 27.02, Business &
Commerce Code, applies only to an offense committed on or after
the effective date of this Act. An offense committed before the
effective date of this Act is governed by the law in effect on the
date the offense was committed, and the former law is continued in
effect for that purpose. For purposes of this section, an offense
was committed before the effective date of this Act if any element
of the offense occurred before that date.
SECTION 4. Section 707.004, Insurance Code, as added by
this Act, applies only to a contract entered into on or after the
effective date of this Act.
SECTION 5. This Act takes effect September 1, 2019.