Texas 2025 - 89th Regular

Texas House Bill HB4020 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	89R3560 SCL-F
2	2	By: Hayes H.B. No. 4020
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7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to presuit notice and inspection requirements associated
10	10	with, and certain liability in connection with, certain insurance
11	11	claims for property damage.
12	12	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
13	13	SECTION 1. Section 542.060(c), Insurance Code, is amended
14	14	to read as follows:
15	15	(c) In regard to a claim that is subject to [an action to
16	16	which] Chapter 542A [applies], if an insurer that is liable for the
17	17	[a] claim under an insurance policy is not in compliance with this
18	18	subchapter, the insurer is liable to pay the holder of the policy,
19	19	in addition to the amount of the claim, simple interest on the
20	20	amount of the claim as damages each year at the rate determined on
21	21	the date of judgment by adding five percent to the interest rate
22	22	determined under Section 304.003, Finance Code, together with
23	23	reasonable and necessary attorney's fees. Nothing in this
24	24	subsection prevents the award of prejudgment interest on the amount
25	25	of the claim, as provided by law. Interest awarded under this
26	26	subsection as damages accrues beginning on the date the claim was
27	27	required to be paid.
28	28	SECTION 2. Section 542A.003, Insurance Code, is amended by
29	29	amending Subsections (b) and (g) and adding Subsections (b-1),
30	30	(b-2), and (b-3) to read as follows:
31	31	(b) The notice required under this section must [provide]:
32	32	(1) reference this chapter [a statement of the acts or
33	33	omissions giving rise to the claim];
34	34	(2) describe the damage to or loss of covered property
35	35	for which payment is owed under the insurance policy in sufficient
36	36	detail to give the insurer a fair opportunity to adjust the claim;
37	37	(3) state the claimant's legal and factual basis for
38	38	believing the claim is covered by the insurance policy;
39	39	(4) provide a detailed, claimant- and claim-specific
40	40	description of the acts or omissions by each insurer or agent that
41	41	constitute a violation of a provision of the insurance policy, a
42	42	statute, a provision of the Texas Administrative Code, or a common
43	43	law standard of conduct;
44	44	(5) except as provided by Subsection (b-1), state the
45	45	specific amount of money alleged to be owed by the insurer on the
46	46	claim for the damage to or loss of covered property described by
47	47	Subdivision (2);
48	48	(6) state [and
49	49	[(3)] the amount of reasonable and necessary
50	50	attorney's fees incurred by the claimant to investigate the claim
51	51	and prepare the notice required by this section, calculated by
52	52	multiplying the number of hours actually worked by the claimant's
53	53	attorney, as of the date the notice is given and as reflected in
54	54	contemporaneously kept time records, by an hourly rate that is
55	55	customary for similar legal services; and
56	56	(7) include the attorney's contemporaneously kept time
57	57	records and all existing estimates, invoices, statements,
58	58	receipts, engineer's or inspector's reports, or other items
59	59	constituting proof of the alleged loss that are possessed by the
60	60	claimant or subject to the claimant's control.
61	61	(b-1) Instead of stating the specific amount of money
62	62	alleged to be owed as required by Subsection (b)(5), a claimant may
63	63	state that the claimant needs additional time to evaluate and
64	64	quantify the claim before the claimant states an amount the
65	65	claimant will accept in full payment of the claim. By making this
66	66	statement, the claimant temporarily postpones the claimant's
67	67	obligation to comply with that subsection as provided by Section
68	68	542A.005.
69	69	(b-2) The purpose of the notice required by this section is
70	70	to enable an insurer to adjust and, if the insurer chooses, satisfy
71	71	a claimant's claim by paying the amount the claimant has alleged is
72	72	owed on the claim. The amount alleged by the claimant to be owed on
73	73	the claim must be an amount the claimant will accept in full payment
74	74	of the claim.
75	75	(b-3) Notwithstanding Subsection (e), an insurer may pay
76	76	the amount the claimant alleges is owed on the claim and pursue an
77	77	action under Chapter 37, Civil Practice and Remedies Code, to
78	78	determine the reasonableness or necessity of attorney's fees
79	79	allegedly incurred by the claimant as stated in the claimant's
80	80	notice.
81	81	(g) At the option of a person to whom notice was given,
82	82	notice [Notice] given under this chapter is admissible in evidence
83	83	in a civil action or alternative dispute resolution proceeding
84	84	relating to the claim for which the notice is given.
85	85	SECTION 3. Section 542A.004, Insurance Code, is amended to
86	86	read as follows:
87	87	Sec. 542A.004. INSPECTION. Not later than the 15th [30th]
88	88	day after receiving a presuit notice given under Section
89	89	542A.003(a), a person to whom notice is given may send a written
90	90	request to the claimant to inspect, photograph, or evaluate, in a
91	91	reasonable manner and at a reasonable time, the property that is the
92	92	subject of the claim. If reasonably possible, the inspection,
93	93	photography, and evaluation must be completed not later than the
94	94	30th [60th] day after the date the person receives the presuit
95	95	notice.
96	96	SECTION 4. Section 542A.005, Insurance Code, is amended by
97	97	amending Subsections (a), (b), (c), (d), and (e) and adding
98	98	Subsections (d-1), (g), and (h) to read as follows:
99	99	(a) In addition to taking any other act allowed by contract
100	100	or by any other law, a person against whom an action to which this
101	101	chapter applies is pending may file a plea in abatement not later
102	102	than the 30th day after the date the person files an original answer
103	103	in the court in which the action is pending if the person:
104	104	(1) did not receive a presuit notice fully complying
105	105	with Section 542A.003; [or]
106	106	(2) received a presuit notice under Section 542A.003
107	107	stating that more time is needed for the claimant to state an amount
108	108	the claimant will accept in full payment of the claim; or
109	109	(3) requested under Section 542A.004 but was not
110	110	provided a reasonable opportunity to inspect, photograph, or
111	111	evaluate the property that is the subject of the claim.
112	112	(b) The court shall abate the action if the court finds that
113	113	the person filing the plea in abatement:
114	114	(1) did not, for any reason, receive a presuit notice
115	115	fully complying with Section 542A.003; [or]
116	116	(2) received a presuit notice under Section 542A.003
117	117	stating that more time is needed for the claimant to state an amount
118	118	the claimant will accept in full payment of the claim; or
119	119	(3) requested under Section 542A.004 but was not
120	120	provided a reasonable opportunity to inspect, photograph, or
121	121	evaluate the property that is the subject of the claim.
122	122	(c) An action is automatically abated without a court order
123	123	beginning on the 11th day after the date a plea in abatement is
124	124	filed if the plea:
125	125	(1) is verified and alleges that the person against
126	126	whom the action is pending:
127	127	(A) did not receive a presuit notice fully
128	128	complying with Section 542A.003; [or]
129	129	(B) received a presuit notice under Section
130	130	542A.003 stating that more time is needed for the claimant to state
131	131	an amount the claimant will accept in full payment of the claim; or
132	132	(C) requested under Section 542A.004 but was not
133	133	provided a reasonable opportunity to inspect, photograph, or
134	134	evaluate the property that is the subject of the claim; and
135	135	(2) is not controverted by an affidavit filed by the
136	136	claimant before the 11th day after the date the plea in abatement is
137	137	filed.
138	138	(d) An affidavit described by Subsection (c)(2)
139	139	controverting whether the person against whom the action is pending
140	140	received a presuit notice fully complying with Section 542A.003 or
141	141	stating that more time is needed for the claimant to state an amount
142	142	the claimant will accept in full payment of the claim under Section
143	143	542A.003 must:
144	144	(1) include as an attachment a copy of the document the
145	145	claimant sent to give notice of the claimant's action; and
146	146	(2) state the date on which the notice was given.
147	147	(d-1) If an affidavit described by Subsection (c)(2) is
148	148	timely filed by a claimant, the court must enter an order abating
149	149	the action unless the court finds that the claimant's controverting
150	150	affidavit establishes that the claimant timely provided a presuit
151	151	notice to the movant that fully complied with Section 542A.003,
152	152	including the requirement that the notice state an amount the
153	153	claimant will accept in full payment of the claim.
154	154	(e) An abatement under this section continues until the
155	155	later of:
156	156	(1) the 60th day after the date a notice fully
157	157	complying with Section 542A.003, including the requirement that the
158	158	notice state an amount the claimant will accept in full payment of
159	159	the claim, is given; or
160	160	(2) the 15th day after the date of the requested
161	161	inspection, photographing, or evaluating of the property is
162	162	completed.
163	163	(g) The filing of a plea in abatement stays all discovery in
164	164	the action until an order overruling the plea is signed by the trial
165	165	court or the abatement period provided by Subsection (e) has
166	166	expired.
167	167	(h) Prejudgment interest, interest under Section 542.060,
168	168	or interest that might be awarded under any other law does not
169	169	accrue while an action is abated under this section.
170	170	SECTION 5. Section 542A.007(d), Insurance Code, is amended
171	171	to read as follows:
172	172	(d) If a defendant in an action to which this chapter
173	173	applies pleads and proves that the defendant was entitled to but was
174	174	not given a presuit notice stating the specific amount alleged to be
175	175	owed by the insurer under Section 542A.003(b)(2) at least 61 days
176	176	before the date the action was filed by the claimant, the court may
177	177	not award [to the claimant] any attorney's fees to the claimant
178	178	under any law [incurred after the date the defendant files the
179	179	pleading with the court]. A pleading under this subsection must be
180	180	filed not later than the 30th day after the date the defendant files
181	181	an original answer in the court in which the action is pending.
182	182	SECTION 6. (a) Section 542.060(c), Insurance Code, as
183	183	amended by this Act, applies only to a claim, as defined by Section
184	184	542A.001, Insurance Code, made on or after the effective date of
185	185	this Act. A claim made before the effective date of this Act is
186	186	governed by the law as it existed immediately before the effective
187	187	date of this Act, and that law is continued in effect for that
188	188	purpose.
189	189	(b) Chapter 542A, Insurance Code, as amended by this Act,
190	190	applies only to an action that is filed on or after the effective
191	191	date of this Act. An action filed before the effective date of this
192	192	Act is governed by the law as it existed immediately before the
193	193	effective date of this Act, and that law is continued in effect for
194	194	that purpose.
195	195	SECTION 7. This Act takes effect immediately if it receives
196	196	a vote of two-thirds of all the members elected to each house, as
197	197	provided by Section 39, Article III, Texas Constitution. If this
198	198	Act does not receive the vote necessary for immediate effect, this
199	199	Act takes effect September 1, 2025.