88R7328 JES-D
By: Cain H.B. No. 2257
A BILL TO BE ENTITLED
AN ACT
relating to notice of certain provisions in insurance policies
issued by surplus lines insurers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 981, Insurance Code, is
amended by adding Section 981.106 to read as follows:
Sec. 981.106. NOTICE REQUIREMENTS FOR CERTAIN PROVISIONS IN
SURPLUS LINES POLICIES. (a) A surplus lines insurer must provide
written notice to an insured if the surplus lines insurance policy:
(1) subjects the insured to the jurisdiction or laws
of another state or country;
(2) requires the insured to submit to arbitration in
another state or country or under the laws of another state or
country;
(3) includes a deductible that exceeds the replacement
cost of any structural component of the covered property; or
(4) provides that the insurer will only pay the actual
cash value for the repair or replacement of a structural component
of the covered property.
(b) A notice provided under Subsection (a) must be:
(1) signed and notarized by the surplus lines agent
and the insured; and
(2) retained by the insurer until the fifth
anniversary of the date the insured's policy terminates.
(c) An insured is entitled to void a provision described by
Subsection (a) in a surplus lines insurance policy if the insurer
does not disclose or retain documentation of the notice provided to
the insured regarding the provision in accordance with this
section.
SECTION 2. The changes in law made by this Act apply only to
a surplus lines insurance policy delivered, issued for delivery, or
renewed on or after January 1, 2024.
SECTION 3. This Act takes effect September 1, 2023.