Texas House Bill HB2065

Texas 2023 - 88th Regular

• Filed: 2/8/23
• Out of House Committee: 4/21/23
• Voted on by House: 5/2/23
• Out of Senate Committee: 5/16/23
• Voted on by Senate: 5/19/23
• Governor Action: 6/10/23

Caption

Relating to nonrenewal of certain private passenger automobile insurance policies for the insured's failure to cooperate in a third-party liability claim or action.

Impact

The introduction of HB 2065 will have significant impacts on Texas state laws governing automobile insurance. Specifically, it amends Section 551.1053 of the Insurance Code to require detailed notifications from insurers regarding nonrenewal due to non-cooperation. This change ensures that both policyholders and insurers are clear about the expectations and consequences related to the fulfillment of claims, thereby supporting the integrity of the insurance process.

Summary

House Bill 2065 addresses the nonrenewal of private passenger automobile insurance policies due to the insured's failure to cooperate in third-party liability claims. The legislation mandates that insurers must give written notice to the named insured detailing how they have failed to cooperate and that the policy will not be renewed if the situation is not rectified. By specifying that the insured needs to cooperate in the claims process, the bill aims to clarify responsibilities and reduce ambiguity in insurance disputes following automobile accidents.

Sentiment

The sentiment around HB 2065 has been largely supportive among stakeholders, particularly insurers and consumer advocacy groups. Proponents see the legislation as a necessary adjustment to improve cooperation between insured individuals and insurers, thereby facilitating faster and fairer resolutions to claims. Testimonies during discussions emphasized the importance of cooperation in resolving claims based on factual circumstances rather than ambiguity. This pro-cooperation perspective reflects a consensus that better clarity in processes directly benefits consumers as well as the insurance industry.

Contention

Notable points of contention include concerns surrounding the impacts on policyholders who may be unable to meet the cooperation requirements due to circumstances beyond their control. Opponents of the bill may argue that the strict criteria for nonrenewal could disproportionately affect those who are already vulnerable. Discussions during committee meetings centered on the balance between protecting insurers' rights to nonrenewal when faced with non-cooperation and ensuring that policyholders are not unfairly penalized in situations where cooperation may be challenging.

Texas Constitutional Statutes Affected

Insurance Code

• Chapter 551. Practices Relating To Declination, Cancellation, And Nonrenewal Of Insurance Policies
  • Section: 1053
  • Section: 1053
  • Section: 1053
  • Section: 1053