IIAT's Legislative Results
Please read on to find a list of important insurance bills from the 2017 Texas Legislature. We have attempted to provide a concise overview of the bills of interest to IIAT members and to the insurance industry overall. Those listed below are just a small sampling of the over 1,200 bills passed during the 85th Legislative Session. All 6,600+ bills filed can be reviewed by visiting www.capitol.state.tx.us and entering the bill number or word phrase relating to the legislation.
As previously reported, IIAT's Governmental Affairs team had a successful session passing all four of our key legislative issues. For full details on our key legislation, click here.
Hail Litigation Reform
HB 1774 by Greg Bonnen is the Hail Litigation Reform bill that has been signed by Governor Abbott with an effective date of 9/1/17.
- Stops the mass tort litigation following natural catastrophes
- 60-day "pre-suit" notice is now required with dollar amount of loss disclosed
- Inflated, fraudulent claims can result in no legal fees to plaintiff attorney
- Insurer can assume the liability of agent to avoid venue shopping
Surplus Lines Freedom
HB 1559 by Frullo is the Surplus Lines Freedom bill that has been signed by Governor Abbott with an effective date of 9/1/17 for policies expiring 1/1/18.
- Eliminates "diligent effort" search, if certain conditions are met
- Allows agents to offer standard and surplus lines options to sophisticated commercial buyers
- Puts financial requirements in place – AM Best A- or better rated surplus lines companies only
Coverage Change Notification
SB 417 by Watson is our Change Notification bill which was signed into law by Governor Abbott with an effective date of 9/1/17 for policies expiring 1/1/18.
- Insurers must now advise agents and consumers of changes to a policy before renewal
- Notification must be in plain language
- Insurors no longer have to send "non-renewal" letters when a policy change is made
HB 3018 by Phelan is the TWIA Reciprocity bill which is on the Governor's desk awaiting his signature and will be effective on 9/1/17.
- Louisiana excluded Texas agent access to their wind pool so IIAT worked to pass HB 3018
- States that exclude Texas agents will now be excluded from TWIA
- Resulting in Louisiana now working to reinstate our access to their facility
Other Insurance Legislation of Interest
Texting While Driving
HB 62, a texting while driving bill, has finally passed thanks to the persistence of Rep. Craddick. Proponents say that this will definitely curb texting and talking usage and therefore reduce serious and often fatal accidents. Opponents say that the bill does not go far enough as it still allows the use of handheld devices for navigation, music, and other apps that are not specifically excluded. As passed, this would preempt local ordinances for texting only, and not for other uses of handheld devices. Signed by Governor Abbott.
SB 507 by Hancock further expands the mediation requirement for balanced billing. This redefines "facility based provider," further than previous, to include all health care practitioners and make them subject to mediation of balanced bills for out-of-network charges.
SB 1406 by Creighton and Campbell will allow Texas to file for a state innovation waiver for small group benefit plans with the Federal Government. If granted, this will allow some flexibility and plan options outside the bounds of the current ACA.
SB 718 by Creighton adds an exemption to the regulation of insurance adjusters handling first party claims of an amount of $500 or less or where coverage provided is $500 or less.
Agent Receivership or Conservatorship
HB 2542 by Rodney Anderson will require the TDI commissioner to send written notice to all insurers who are listed as holding an appointment with any agent that has been put into receivership or conservatorship by TDI, advising of such action. Currently, this is not allowed to be disclosed to the insurers contracted with these agents.
Transportation Network Companies
HB 100 by Paddie preempts all local ordinances for Transportation Network Companies (TNCs) and specifically allows for the regulation of TNCs by the state. This requires that all TNCs are required to obtain a permit to operate in the state and that they must meet the insurance requirements of Ins. Code 1954 which passed in the 2015 session.
Commissioner Authority and NAIC
SB 1450 by Larry Taylor prohibits the Commissioner of Insurance from adopting or enforcing a rule that implements an interstate, national, or international agreement that infringes on Texas' ability to regulate the business of insurance. Furthermore, the bill prohibits the commissioner from enforcing an NAIC rule or assuming that the department has rulemaking authority, unless it is specifically granted in statute. Technical or non-substantive issues regarding accreditation are authorized but must be reported to the legislature.
Straight Ticket Voting
HB 25 by Simmons made an important and surprising change that could significantly impact voting and future elections. Beginning with the 2020 elections, straight ticket voting will not be allowed in any Texas election. Democrats have already signaled that they may challenge the new law on the basis that it creates an impermissible burden on minority voting.