Bill Text: TX HB2839 | 2011-2012 | 82nd Legislature | Introduced

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Bill Title: Relating to regulation of title insurance rates on a file and use basis.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2011-03-17 - Referred to Insurance [HB2839 Detail]

Download: Texas-2011-HB2839-Introduced.html

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82R10377 PMO-F
By: Smithee H.B. No. 2839

A BILL TO BE ENTITLED
AN ACT
relating to regulation of title insurance rates on a file and use
basis.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Section 2703.153, Insurance Code,
is amended to read as follows:
Sec. 2703.153. COLLECTION OF DATA FOR DETERMINING [FIXING]
PREMIUM RATES; ANNUAL STATISTICAL REPORT.
SECTION 2. Section 2703.153(a), Insurance Code, is amended
to read as follows:
(a) Each title insurance company and title insurance agent
engaged in the business of title insurance in this state shall
annually submit to the department, as required by the department to
collect data to use to determine [fix] premium rates, a statistical
report containing information relating to:
(1) loss experience;
(2) expense of operation; and
(3) other material matters.
SECTION 3. Subchapter D, Chapter 2703, Insurance Code, is
amended by adding Section 2703.154 to read as follows:
Sec. 2703.154. EXCEPTIONS. Notwithstanding this
subchapter, real property title insurance rates are determined
under Subchapter F.
SECTION 4. Subchapter E, Chapter 2703, Insurance Code, is
amended by adding Section 2703.209 to read as follows:
Sec. 2703.209. EXCEPTIONS. Notwithstanding this
subchapter, real property title insurance rates are determined
under Subchapter F.
SECTION 5. Chapter 2703, Insurance Code, is amended by
adding Subchapter F to read as follows:
SUBCHAPTER F. FILE AND USE PREMIUM RATES
Sec. 2703.251. RATE STANDARDS. (a) In setting rates, a
title insurance company shall consider:
(1) past and prospective loss experience and expense:
(A) inside this state; and
(B) outside this state if the data from this
state is not credible;
(2) the insurer's and agents' actuarially credible
historical premium, exposure, loss, and expense experience;
(3) operating expenses;
(4) investment income;
(5) a reasonable margin for profit; and
(6) any other factors derived from information or data
inside and outside this state:
(A) determined relevant by the insurer; and
(B) not disallowed by the commissioner.
(b) A rate may not be excessive, inadequate, unreasonable,
or unfairly discriminatory for the risks to which the rate applies.
(c) In setting rates that apply only to policyholders in
this state, an insurer shall use available premium, loss, expenses,
and exposure information from this state to the full extent of the
actuarial credibility of the information. The insurer may use
experience from outside this state to supplement information from
this state that is not actuarially credible.
Sec. 2703.252. RATE FILINGS AND SUPPORTING INFORMATION.
(a) For title insurance policies written in this state, each title
insurance company shall file with the commissioner all rates,
supporting information, supplementary rating information, and
additional information required by the commissioner.
(b) The commissioner by rule shall determine the
information required to be included in the filing, including:
(1) categories of supporting information and
supplementary rating information; and
(2) statistics or other information to support the
rates to be used by the insurer or agent.
Sec. 2703.253. DISAPPROVAL OF RATE IN RATE FILING; HEARING.
(a) The commissioner shall disapprove a rate if the commissioner
determines that the filing made under this chapter does not meet the
standards established under Section 2703.251.
(b) If the commissioner disapproves a filing, the
commissioner shall issue an order specifying in what respects the
filing fails to meet the requirements of this subchapter.
(c) The filer is entitled to a hearing on written request
made to the commissioner not later than the 30th day after the date
the order disapproving the filing takes effect.
Sec. 2703.254. DISAPPROVAL OF RATE IN EFFECT; HEARING. (a)
The commissioner may disapprove a rate that is in effect only after
a hearing. The commissioner shall provide the filer at least 20
days' written notice.
(b) The commissioner must issue an order disapproving a rate
under Subsection (a) not later than the 15th day after the close of
the hearing. The order must:
(1) specify in what respects the rate fails to meet the
requirements of this chapter; and
(2) state the date on which further use of the rate is
prohibited, which may not be earlier than the 45th day after the
close of the hearing under this section.
Sec. 2703.255. GRIEVANCE. (a) An insured, underwriter, or
agent who is aggrieved with respect to any filing under this chapter
that is in effect, or the public insurance counsel, may apply to the
commissioner in writing for a hearing on the filing. The
application must specify the grounds for the applicant's grievance.
(b) The commissioner shall hold a hearing on an application
filed under Subsection (a) not later than the 30th day after the
date the commissioner receives the application if the commissioner
determines that:
(1) the application is made in good faith;
(2) the applicant would be aggrieved as alleged if the
grounds specified in the application were established; and
(3) the grounds specified in the application otherwise
justify holding the hearing.
(c) The commissioner shall provide written notice of a
hearing under Subsection (b) to the applicant and each insurer that
made the filing not later than the 10th day before the date of the
hearing.
(d) If, after the hearing, the commissioner determines that
the filing does not meet the requirements of this chapter, the
commissioner shall issue an order:
(1) specifying in what respects the filing fails to
meet those requirements; and
(2) stating the date on which the filing is no longer
in effect, which must be within a reasonable period after the order
date.
(e) The commissioner shall send copies of the order issued
under Subsection (d) to the applicant and each affected insurer.
Sec. 2703.256. PUBLIC INFORMATION. Each filing made, and
any supporting information filed under this chapter as of the date
the filing is received by the department:
(1) is public information;
(2) is not subject to any exceptions to disclosure
under Chapter 552, Government Code; and
(3) cannot be withheld from disclosure under any other
law.
SECTION 6. Subchapter B, Chapter 2751, Insurance Code, is
amended by adding Section 2751.056 to read as follows:
Sec. 2751.056. EXCEPTIONS. Notwithstanding this
subchapter, personal property title insurance rates are determined
under Subchapter F, Chapter 2703.
SECTION 7. Section 2703.153(c), Insurance Code, is
repealed.
SECTION 8. The change in law made by this Act applies only
to a rate that first becomes effective on or after January 1, 2012.
A rate that first becomes effective before January 1, 2012, is
governed by the law in effect immediately before the effective date
of this Act, and that law is continued in effect for that purpose.
SECTION 9. This Act takes effect on September 1, 2011.