Texas Senate Bill SB1035

Texas 2019 - 86th Regular

Caption

Relating to maximum liability limits for windstorm and hail insurance coverage provided through the Texas Windstorm Insurance Association.

Impact

The legislation introduces a more structured process for establishing and approving liability limits for windstorm and hail insurance, potentially streamlining the approval process. These changes are intended to take effect for any proposed maximum liability limits filed after January 1, 2020, providing clarity and predictability to both insurers and policyholders. Stakeholders believe that this systematic approach could enhance the financial stability of TWIA and improve access to insurance coverage for those impacted by windstorms and hail events.

Summary

SB1035 aims to amend the Insurance Code in Texas regarding the maximum liability limits for windstorm and hail insurance coverage provided by the Texas Windstorm Insurance Association (TWIA). The proposed legislation mandates that the board of directors of TWIA will establish the maximum liability limits under the insurance policies. Significantly, these limits will automatically be considered approved by the commissioner unless the commissioner exercises the right to disapprove or modify them within a specified time frame following the submission of proposed limits.

Contention

While the amendment aims to simplify the regulatory framework, there is potential for contention regarding the adequacy of the proposed limits and the authority of the insurance commissioner in the approval process. Critics may argue that there should be a more robust oversight mechanism to ensure that the established limits adequately cover the risks associated with windstorms and hail damage, especially in vulnerable areas. The balance of promoting efficient regulatory action while ensuring consumer protection and adequate coverage levels could be a point of debate among stakeholders in the insurance landscape.