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A BILL TO BE ENTITLED
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AN ACT
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relating to the definition of commercial property insurance for |
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purposes of certain provisions governing insurance rates and policy |
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forms. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 2251.002, Insurance Code, is amended by |
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amending Subdivision (1) and adding Subdivision (1-a) to read as |
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follows: |
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(1) "Commercial property insurance" means insurance |
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coverage against loss caused by or resulting from loss, damage, or |
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destruction of real or personal property provided through a |
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commercial property insurance policy. The term includes any |
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combination of: |
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(A) commercial fire or allied lines; |
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(B) commercial inland marine insurance; |
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(C) commercial crime coverage; |
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(D) boiler and machinery insurance other than |
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explosion; |
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(E) glass insurance provided as part of other |
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coverage; and |
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(F) as authorized by commissioner rule, |
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insurance covering other perils or providing other coverages or |
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other lines of first party property insurance. |
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(1-a) "Disallowed expenses" includes: |
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(A) administrative expenses, other than |
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acquisition, loss control, and safety engineering expenses, that |
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exceed 110 percent of the industry median for those expenses; |
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(B) lobbying expenses; |
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(C) advertising expenses, other than for |
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advertising: |
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(i) directly related to the services or |
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products provided by the insurer; or |
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(ii) designed and directed at loss |
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prevention; |
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(D) amounts paid by an insurer: |
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(i) as damages in an action brought against |
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the insurer for bad faith, fraud, or any matters other than payment |
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under the insurance contract; or |
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(ii) as fees, fines, penalties, or |
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exemplary damages for a civil or criminal violation of law; |
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(E) contributions to: |
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(i) social, religious, political, or |
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fraternal organizations; or |
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(ii) organizations engaged in legislative |
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advocacy; |
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(F) except as authorized by commissioner rule, |
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fees and assessments paid to advisory organizations; |
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(G) any amount determined by the commissioner to |
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be excess premiums charged by the insurer; and |
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(H) any unreasonably incurred expenses, as |
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determined by the commissioner after notice and hearing. |
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SECTION 2. Section 2301.002, Insurance Code, is amended by |
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amending Subdivision (1) and adding Subdivision (1-a) to read as |
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|
follows: |
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|
(1) "Commercial property insurance" means insurance |
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|
coverage against loss caused by or resulting from loss, damage, or |
|
|
destruction of real or personal property provided through a |
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|
commercial property insurance policy. The term includes any |
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|
combination of: |
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|
(A) commercial fire or allied lines; |
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|
(B) commercial inland marine insurance; |
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(C) commercial crime coverage; |
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(D) boiler and machinery insurance other than |
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explosion; |
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(E) glass insurance provided as part of other |
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coverage; and |
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(F) as authorized by commissioner rule, |
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insurance covering other perils or providing other coverages or |
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other lines of first party property insurance. |
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(1-a) "Form" means an insurance policy form or a |
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printed endorsement form. |
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SECTION 3. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2017. |