CHAPTER 2210. TEXAS WINDSTORM INSURANCE ASSOCIATION
INSURANCE CODE
TITLE 10. PROPERTY AND CASUALTY INSURANCE
SUBTITLE G. POOLS, GROUPS, PLANS, AND SELF-INSURANCE
CHAPTER 2210. TEXAS WINDSTORM INSURANCE ASSOCIATION
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2210.001. PURPOSE. The primary purpose of the Texas
Windstorm Insurance Association is the provision of an adequate
market for windstorm and hail insurance in the seacoast territory
of this state. The legislature finds that the provision of
adequate windstorm and hail insurance is necessary to the
economic welfare of this state, and without that insurance, the
orderly growth and development of this state would be severely
impeded. This chapter provides a method by which adequate
windstorm and hail insurance may be obtained in certain
designated portions of the seacoast territory of this state. The
association is intended to serve as a residual insurer of last
resort for windstorm and hail insurance in the seacoast
territory. The association shall:
(1) function in such a manner as to not be a direct competitor
in the private market; and
(2) provide windstorm and hail insurance coverage to those who
are unable to obtain that coverage in the private market.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 5, eff. June 19, 2009.
Sec. 2210.002. SHORT TITLE; SUNSET PROVISION. (a) This chapter
may be cited as the Texas Windstorm Insurance Association Act.
(b) The association is subject to review under Chapter 325,
Government Code (Texas Sunset Act), but is not abolished under
that chapter. The association shall be reviewed during the
period in which state agencies abolished in 2015 are reviewed.
The association shall pay the costs incurred by the Sunset
Advisory Commission in performing the review of the association
under this subsection. The Sunset Advisory Commission shall
determine the costs of the review performed under this
subsection, and the association shall pay the amount of those
costs promptly on receipt of a statement from the Sunset Advisory
Commission regarding those costs. This subsection expires
September 1, 2015.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 6, eff. June 19, 2009.
Sec. 2210.0025. BIENNIAL REPORT TO LEGISLATURE. On or before
December 31 of each even-numbered year, the board of directors
shall submit to the commissioner, the appropriate committees of
each house of the legislature, and the Sunset Advisory Commission
a written report relating to the operations of the association
during the preceding biennium. The report must include:
(1) any proposed changes in the laws relating to regulation of
the association and a statement of the reasons for the changes;
and
(2) any information regarding association operations or
procedures that is requested by the department to be addressed in
the report.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 7, eff. June 19, 2009.
Sec. 2210.003. GENERAL DEFINITIONS. In this chapter, unless the
context clearly indicates otherwise:
(1) "Association" means the Texas Windstorm Insurance
Association.
(2) "Board of directors" means the board of directors of the
association.
(3) "Catastrophe area" means a municipality, a part of a
municipality, a county, or a part of a county designated by the
commissioner under Section 2210.005.
(3-a) "Catastrophe reserve trust fund" means the trust fund
established under Subchapter J.
(4) "First tier coastal county" means:
(A) Aransas County;
(B) Brazoria County;
(C) Calhoun County;
(D) Cameron County;
(E) Chambers County;
(F) Galveston County;
(G) Jefferson County;
(H) Kenedy County;
(I) Kleberg County;
(J) Matagorda County;
(K) Nueces County;
(L) Refugio County;
(M) San Patricio County; or
(N) Willacy County.
(5) Repealed by Acts 2009, 81st Leg., R.S., Ch. 1408, Sec.
44(1), eff. June 19, 2009.
(6) "Insurance" means Texas windstorm and hail insurance.
(7) "Net direct premium" means gross direct written premium less
return premium on each canceled contract, regardless of assumed
or ceded reinsurance, that is written on property in this state,
as defined by the board of directors.
(8) "New building code" means a building standard,
specification, or guideline adopted by the commissioner after May
1, 1997, that must be satisfied before new residential
construction qualifies for a certificate of compliance that
constitutes evidence of insurability of the structure by the
association.
(9) "Plan of operation" means the plan adopted under this
chapter for the operation of the association.
(10) "Seacoast territory" means the territory of this state
composed of the first tier coastal counties and the second tier
coastal counties.
(11) "Second tier coastal county" means:
(A) Bee County;
(B) Brooks County;
(C) Fort Bend County;
(D) Goliad County;
(E) Hardin County;
(F) Harris County;
(G) Hidalgo County;
(H) Jackson County;
(I) Jim Wells County;
(J) Liberty County;
(K) Live Oak County;
(L) Orange County;
(M) Victoria County; or
(N) Wharton County.
(12) Repealed by Acts 2009, 81st Leg., R.S., Ch. 1408, Sec.
44(1), eff. June 19, 2009.
(13) "Texas windstorm and hail insurance" means deductible
insurance against:
(A) direct loss to insurable property incurred as a result of
windstorm or hail, as those terms are defined and limited in
policies and forms approved by the department; and
(B) indirect losses resulting from the direct loss.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 8, eff. June 19, 2009.
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 44(1), eff. June 19, 2009.
Sec. 2210.004. DEFINITION OF INSURABLE PROPERTY. (a) Except as
provided by Subsection (h), for purposes of this chapter and
subject to this section, "insurable property" means immovable
property at a fixed location in a catastrophe area or corporeal
movable property located in that immovable property, as
designated in the plan of operation, that is determined by the
association according to the criteria specified in the plan of
operation to be in an insurable condition against windstorm and
hail, as determined by normal underwriting standards. The term
includes property described by Section 2210.209.
(b) A structure located in a catastrophe area, construction of
which began on or after the 30th day after the date of
publication of the plan of operation, that is not built in
compliance with building specifications set forth in the plan of
operation or continued in compliance with those specifications,
does not constitute an insurable risk for purposes of windstorm
and hail insurance except as otherwise provided by this chapter.
(c) A structure, or an addition to a structure, that is
constructed in conformity with plans and specifications that
comply with the specifications set forth in the plan of operation
at the time construction begins may not be declared ineligible
for windstorm and hail insurance as a result of subsequent
changes in the building specifications set forth in the plan of
operation.
(d) Except as otherwise provided by this section, if repair of
damage to a structure involves replacement of items covered in
the building specifications set forth in the plan of operation,
the repairs must be completed in a manner that complies with
those specifications for the structure to continue to be
insurable property for windstorm and hail insurance.
(e) If repair to a structure, other than a roof repair that
exceeds 100 square feet, is less than five percent of the total
amount of property coverage on the structure, the repairs may be
completed in a manner that returns the structure to the
structure's condition immediately before the loss without
affecting the eligibility of the structure to qualify as
insurable property.
(f) This chapter does not preclude special rating of individual
risks as may be provided in the plan of operation.
(g) For purposes of this chapter, a residential structure is
insurable property if:
(1) the residential structure is not:
(A) a condominium, apartment, duplex, or other multifamily
residence; or
(B) a hotel or resort facility;
(2) the residential structure is located within an area
designated as a unit under the Coastal Barrier Resources Act
(Pub. L. No. 97-348); and
(3) a building permit or plat for the residential structure was
filed with the municipality, the county, or the United States
Army Corps of Engineers before June 11, 2003.
(h) For purposes of this chapter, a structure is not insurable
property if the commissioner of the General Land Office notifies
the association of a determination that the structure is located
on the public beach under procedures established under Section
61.011, Natural Resources Code, and that the structure:
(1) constitutes an imminent hazard to safety, health, or public
welfare; or
(2) substantially interferes with the free and unrestricted
right of the public to enter or leave the public beach or
traverse any part of the public beach.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
730, Sec. 3B.061(a), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.061(a), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
1256, Sec. 21, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 9, eff. June 19, 2009.
Sec. 2210.005. DESIGNATION AS CATASTROPHE AREA; REVOCATION OF
DESIGNATION. (a) After at least 10 days' notice and a hearing,
the commissioner may designate an area of the seacoast territory
of this state as a catastrophe area if the commissioner
determines, unless such a determination results in an adverse
impact to the exposure of the association, that windstorm and
hail insurance is not reasonably available to a substantial
number of the owners of insurable property located in that
territory because the territory is subject to unusually frequent
and severe damage resulting from windstorms or hailstorms.
(b) The commissioner shall revoke a designation made under
Subsection (a) if the commissioner determines, after at least 10
days' notice and a hearing, that the applicable insurance
coverage is no longer reasonably unavailable to a substantial
number of owners of insurable property within the designated
territory.
(c) If the association determines that windstorm and hail
insurance is no longer reasonably unavailable to a substantial
number of owners of insurable property in a territory designated
as a catastrophe area, the association may request in writing
that the commissioner revoke the designation. After at least 10
days' notice and a hearing, but not later than the 30th day after
the date of the hearing, the commissioner shall:
(1) approve the request and revoke the designation; or
(2) reject the request.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 10, eff. June 19, 2009.
Sec. 2210.006. APPLICABILITY OF CHAPTER TO CERTAIN INSURERS.
(a) Except as provided by Subsection (b), this chapter applies
to each insurer authorized to engage in the business of property
insurance in this state, including a county mutual insurance
company, a Lloyd's plan, and a reciprocal or interinsurance
exchange.
(b) This chapter does not apply to:
(1) a farm mutual insurance company operating under Chapter 911;
(2) a nonaffiliated county mutual fire insurance company
described by Section 912.310 that is writing exclusively
industrial fire insurance policies as described by Section
912.310(a)(2); or
(3) a mutual insurance company or a statewide mutual assessment
company engaged in business under Chapter 12 or 13, Title 78,
Revised Statutes, respectively, before those chapters' repeal by
Section 18, Chapter 40, Acts of the 41st Legislature, 1st Called
Session, 1929, as amended by Section 1, Chapter 60, General Laws,
Acts of the 41st Legislature, 2nd Called Session, 1929, that
retains the rights and privileges under the repealed law to the
extent provided by those sections.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
730, Sec. 3B.063(a), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.063(a), eff. September 1, 2007.
Sec. 2210.007. IMMUNITY FROM LIABILITY IN GENERAL. (a) This
section applies to:
(1) the association and a director, agent, or association staff;
(2) the commissioner, the department, and department staff; and
(3) a participating insurer and the insurer's agents and staff.
(b) A person described by Subsection (a) is not liable, and a
cause of action does not arise against the person, for:
(1) an inspection made under the plan of operation; or
(2) any statement made in good faith by the person:
(A) in a report or communication concerning risks submitted to
the association; or
(B) at any administrative hearing conducted under this chapter
in connection with the inspection or statement.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.008. DEPARTMENT ORDERS; GENERAL RULEMAKING AUTHORITY.
(a) The commissioner may issue any orders that the commissioner
considers necessary to implement this chapter.
(b) The commissioner may adopt rules in the manner prescribed by
Subchapter A, Chapter 36, as reasonable and necessary to
implement this chapter.
(c) In rules adopted under this chapter, the commissioner shall
define the meaning of "alter" and "alteration" for purposes of
this chapter, specifically as used in Subchapters E and F.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 11, eff. June 19, 2009.
Sec. 2210.009. LIST OF PRIVATE INSURERS; INCENTIVE PLAN. (a)
The department shall maintain a list of all insurers that engage
in the business of property and casualty insurance in the
voluntary market in the seacoast territory.
(b) The department shall develop incentive programs in the
manner described by Section 2210.053(b) to encourage authorized
insurers to write insurance on a voluntary basis and to minimize
the use of the association as a means to obtain insurance.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 12, eff. June 19, 2009.
SUBCHAPTER B. ADMINISTRATION OF ASSOCIATION
Sec. 2210.051. COMPOSITION OF ASSOCIATION; REQUIRED MEMBERSHIP.
(a) The association is composed of all property insurers
authorized to engage in the business of property insurance in
this state, other than insurers prevented by law from writing on
a statewide basis coverages available through the association.
(b) As a condition of the insurer's authority to engage in the
business of insurance in this state, each insurer subject to
Subsection (a) must be a member of the association and must
remain a member for the duration of the association's existence.
An insurer that ceases to be a member of the association remains
liable on insurance contracts entered into during the insurer's
membership in the association to the same extent and effect as if
the insurer's membership in the association had not been
terminated.
(c) An insurer that becomes authorized to write and is engaged
in writing insurance that requires the insurer to be a member of
the association shall become a member of the association on the
January 1 following the effective date of that authorization.
The determination of the insurer's participation in the
association is made as of the date of the insurer's membership in
the manner used to determine participation for all other members
of the association.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.052. MEMBER PARTICIPATION IN ASSOCIATION. (a) Each
member of the association shall participate in insured losses and
operating expenses of the association, in excess of premium and
other revenue of the association, in the proportion that the net
direct premiums of that member during the preceding calendar year
bears to the aggregate net direct premiums by all members of the
association, as determined using the information provided under
Subsection (b).
(b) The department shall review annual statements, other
reports, and other statistics that the department considers
necessary to obtain the information required under Subsection (a)
and shall provide that information to the association. The
department is entitled to obtain the annual statements, other
reports, and other statistics from any member of the association.
(c) Each member's participation in the association shall be
determined annually in the manner provided by the plan of
operation. For purposes of determining participation in the
association, two or more members that are subject to common
ownership or that operate in this state under common management
or control shall be treated as a single member. The
determination shall also include the net direct premiums of an
affiliate that is under that common management or control,
including an affiliate that is not authorized to engage in the
business of property insurance in this state.
(d) Notwithstanding Subsection (a), a member, in accordance with
the plan of operation, is entitled to receive credit for similar
insurance voluntarily written in areas designated by the
commissioner. The member's participation in the insured losses
and operating expenses of the association in excess of premium
and other revenue of the association shall be reduced in
accordance with the plan of operation.
(e) Notwithstanding Subsections (a)-(d), an insurer that becomes
a member of the association and that has not previously been a
member of the association is not subject to participation in any
insured losses and operating expenses of the association in
excess of premium and other revenue of the association until the
second anniversary of the date on which the insurer first becomes
a member of the association.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 13, eff. June 19, 2009.
Sec. 2210.053. OPERATION OF ASSOCIATION. (a) In accordance
with this chapter and the plan of operation, and with respect to
insurance on insurable property, the association, on behalf of
the association's members, may:
(1) cause issuance of insurance policies to applicants for
insurance coverage;
(2) assume reinsurance from the members;
(3) cede reinsurance to the members; and
(4) purchase reinsurance on behalf of the members.
(b) The department may develop programs to improve the efficient
operation of the association, including a program designed to
create incentives for insurers to write windstorm and hail
insurance voluntarily to cover property located in a catastrophe
area, especially property located on the barrier islands of this
state.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.054. ANNUAL STATEMENT. (a) The association shall
file annually with the department a statement covering periods
designated by the department that summarizes the transactions,
conditions, operations, and affairs of the association during the
preceding year.
(b) The statement must:
(1) be filed at times designated by the department;
(2) contain the information prescribed by the department; and
(3) be in the form prescribed by the department.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.055. LEGAL COUNSEL. (a) The association shall
establish a plan in the plan of operation under which the
association's legal representation before the department and the
legislature is without conflict of interest or the appearance of
a conflict of interest as defined by the Texas Disciplinary Rules
of Professional Conduct.
(b) The association shall adopt separate and distinct procedures
for legal counsel in disputes involving policyholder claims
against the association.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.056. USE OF ASSOCIATION ASSETS. (a) The
association's net earnings may not inure, in whole or in part, to
the benefit of a private shareholder or individual.
(b) The association's assets may not be used for or diverted to
any purpose other than to:
(1) satisfy, in whole or in part, the liability of the
association on claims made on policies written by the
association;
(2) make investments authorized under applicable law;
(3) pay reasonable and necessary administrative expenses
incurred in connection with the operation of the association and
the processing of claims against the association;
(4) satisfy, in whole or in part, the obligations of the
association incurred in connection with Subchapters B-1, J, and
M, including reinsurance, public securities, and financial
instruments; or
(5) make remittance under the laws of this state to be used by
this state to:
(A) pay claims made on policies written by the association;
(B) purchase reinsurance covering losses under those policies;
or
(C) prepare for or mitigate the effects of catastrophic natural
events.
(c) On dissolution of the association, all assets of the
association revert to this state.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 14, eff. June 19, 2009.
Sec. 2210.057. EXAMINATION OF ASSOCIATION. (a) The association
is subject to Sections 401.051, 401.052, 401.054-401.062,
401.151, 401.152, 401.155, and 401.156 and Subchapter A, Chapter
86.
(b) A final examination report of the association resulting from
an examination as provided by this section is a public record and
is available to the public at the offices of the department in
accordance with Chapter 552, Government Code.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.060. INDEMNIFICATION BY ASSOCIATION. (a) Except as
provided by Subsection (b), the association shall indemnify each
director, officer, and employee of the association and each
member of the association against all costs and expenses actually
and necessarily incurred by the person or entity in connection
with the defense of an action or proceeding in which the person
or entity is made a party because of the person's status as a
director, officer, or employee of the association or the member's
status as a member of the association.
(b) Subsection (a) does not apply to a matter in which the
person or entity is determined in the action or proceeding to be
liable because of misconduct in the performance of duties as a
director, officer, or employee of the association or a member of
the association.
(c) Subsection (a) does not authorize the association to
indemnify a member of the association for participating in the
assessments made by the association in the manner provided by
this chapter.
(d) Indemnification under this section is not exclusive of other
rights to which the member or officer may be entitled as a matter
of law.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 15, eff. June 19, 2009.
SUBCHAPTER B-1. PAYMENT OF LOSSES
Sec. 2210.071. PAYMENT OF EXCESS LOSSES; PAYMENT FROM RESERVES
AND TRUST FUND. (a) If an occurrence or series of occurrences
in a catastrophe area results in insured losses and operating
expenses of the association in excess of premium and other
revenue of the association, the excess losses and operating
expenses shall be paid as provided by this subchapter.
(b) The association shall pay losses in excess of premium and
other revenue of the association from available reserves of the
association and available amounts in the catastrophe reserve
trust fund.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 16, eff. June 19, 2009.
Sec. 2210.072. PAYMENT FROM CLASS 1 PUBLIC SECURITIES; FINANCIAL
INSTRUMENTS. (a) Losses not paid under Section 2210.071 shall
be paid as provided by this section from the proceeds from Class
1 public securities authorized to be issued in accordance with
Subchapter M on or after the date of any occurrence or series of
occurrences that results in insured losses. Public securities
issued under this section must be repaid within a period not to
exceed 10 years, and may be repaid sooner if the board of
directors elects to do so and the commissioner approves.
(b) Public securities described by Subsection (a) shall be
issued as necessary in a principal amount not to exceed $1
billion per year.
(c) If the losses are paid with public securities described by
this section, the public securities shall be repaid in the manner
prescribed by Subchapter M from association premium revenue.
(d) The association may borrow from, or enter into other
financing arrangements with, any market source, under which the
market source makes interest-bearing loans or other financial
instruments to the association to enable the association to pay
losses under this section or to obtain public securities under
this section. For purposes of this subsection, financial
instruments includes commercial paper.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 16, eff. June 19, 2009.
Sec. 2210.073. PAYMENT FROM CLASS 2 PUBLIC SECURITIES. (a)
Losses not paid under Sections 2210.071 and 2210.072 shall be
paid as provided by this section from proceeds from Class 2
public securities authorized to be issued in accordance with
Subchapter M on or after the date of any occurrence that results
in insured losses under this subsection. Public securities
issued under this section must be repaid within a period not to
exceed 10 years, and may be repaid sooner if the board of
directors elects to do so and the commissioner approves.
(b) Public securities described by Subsection (a) may be issued
as necessary in a principal amount not to exceed $1 billion per
year. If the losses are paid with public securities described by
this section, the public securities shall be repaid in the manner
prescribed by Subchapter M.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 16, eff. June 19, 2009.
Sec. 2210.074. PAYMENT THROUGH CLASS 3 PUBLIC SECURITIES. (a)
Losses not paid under Sections 2210.071, 2210.072, and 2210.073
shall be paid as provided by this section from proceeds from
public securities authorized to be issued in accordance with
Subchapter M on or after the date of any occurrence that results
in insured losses under this subsection or through reinsurance as
described by Section 2210.075. Public securities issued under
this section must be repaid within a period not to exceed 10
years, and may be repaid sooner if the board of directors elects
to do so and the commissioner approves.
(b) Public securities described by Subsection (a) may be issued
as necessary in a principal amount not to exceed $500 million per
year. If the losses are paid with public securities described by
this section, the public securities shall be repaid in the manner
prescribed by Subchapter M through member assessments as provided
by this section. The association shall notify each member of the
association of the amount of the member's assessment under this
section. The proportion of the losses allocable to each insurer
under this section shall be determined in the manner used to
determine each insurer's participation in the association for the
year under Section 2210.052. A member of the association may not
recoup an assessment paid under this subsection through a premium
surcharge or tax credit.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 16, eff. June 19, 2009.
Sec. 2210.075. REINSURANCE. (a) Before any occurrence or
series of occurrences, an insurer may elect to purchase
reinsurance to cover an assessment for which the insurer would
otherwise be liable under Section 2210.074(b).
(b) An insurer must notify the board of directors, in the manner
prescribed by the association whether the insurer will be
purchasing reinsurance. If the insurer does not elect to
purchase reinsurance under this section, the insurer remains
liable for any assessment imposed under Section 2210.074(b).
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 16, eff. June 19, 2009.
SUBCHAPTER C. ASSOCIATION BOARD OF DIRECTORS; GENERAL
POWERS AND DUTIES OF BOARD OF DIRECTORS
Sec. 2210.101. ACCOUNTABLE TO COMMISSIONER. The board of
directors is responsible and accountable to the commissioner.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.102. COMPOSITION. (a) The board of directors is
composed of nine members appointed by the commissioner in
accordance with this section.
(b) Four members must be representatives of the insurance
industry.
(c) Four members must, as of the date of the appointment,
reside in the first tier coastal counties. At least one of the
members appointed under this subsection must be a property and
casualty agent who is licensed under this code and is not a
captive agent.
(d) One member must be a representative of an area of this state
that is not located in the seacoast territory with demonstrated
expertise in insurance and actuarial principles.
(e) All members must have demonstrated experience in insurance,
general business, or actuarial principles sufficient to make the
success of the association probable.
(f) Insurers who are members of the association shall nominate,
from among those members, persons to fill any vacancy in the four
board of director seats reserved for representatives of the
insurance industry. The board of directors shall solicit
nominations from the members and submit the nominations to the
commissioner. The nominee slate submitted to the commissioner
under this subsection must include at least three more names than
the number of vacancies. The commissioner shall appoint
replacement insurance industry representatives from the nominee
slate.
(g) The commissioner shall appoint one person to serve as a
nonvoting member of the board to advise the board regarding
issues relating to the inspection process. The commissioner may
give preference in an appointment under this subsection to a
person who is a qualified inspector under Section 2210.254. The
nonvoting member appointed under this section must:
(1) be an engineer licensed by, and in good standing with, the
Texas Board of Professional Engineers;
(2) reside in a first tier coastal county; and
(3) be knowledgeable of, and have professional expertise in,
wind-related design and construction practices in coastal areas
that are subject to high winds and hurricanes.
(h) The persons appointed under Subsection (c) must be from
different counties.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
548, Sec. 2.14, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 18, eff. June 19, 2009.
Sec. 2210.103. TERMS. (a) Members of the board of directors
serve three-year staggered terms, with the terms of three members
expiring on the third Tuesday of March of each year.
(b) A person may serve on the board of directors for not more
than three consecutive full terms, not to exceed nine years.
(c) A member of the board of directors may be removed by the
commissioner with cause stated in writing and posted on the
association's website. The commissioner shall appoint a
replacement in the manner provided by Section 2210.102 for a
member who leaves or is removed from the board of directors.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 19, eff. June 19, 2009.
Sec. 2210.104. OFFICERS. The board of directors shall elect
from the board's membership an executive committee consisting of
a presiding officer, assistant presiding officer, and
secretary-treasurer.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 20, eff. June 19, 2009.
Sec. 2210.105. MEETINGS. (a) Except for an emergency meeting,
the association shall notify the department not later than the
11th day before the date of a meeting of the board of directors
or of the members of the association.
(b) Except for a closed meeting authorized by Subchapter D,
Chapter 551, Government Code, a meeting of the board of directors
or of the members of the association is open to:
(1) the commissioner or the commissioner's designated
representative; and
(2) the public.
(c) Notice of a meeting of the board of directors or the
association must be given as provided by Chapter 551, Government
Code.
(d) Except for an emergency meeting, a meeting of the board of
directors shall be held at a location as determined by the board
of directors.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 21, eff. June 19, 2009.
Sec. 2210.1051. MEETINGS OF BOARD OF DIRECTORS. (a)
Notwithstanding Chapter 551, Government Code, or any other law,
members of the board of directors may meet by telephone
conference call, videoconference, or other similar
telecommunication method. The board may use telephone conference
call, videoconference, or other similar telecommunication method
for purposes of establishing a quorum or voting or for any other
meeting purpose in accordance with this subsection and Subsection
(b). This subsection applies without regard to the subject
matter discussed or considered by the members of the board at the
meeting.
(b) A meeting held by telephone conference call,
videoconference, or other similar telecommunication method:
(1) is subject to the notice requirements applicable to other
meetings of the board of directors;
(2) may not be held unless notice of the meeting specifies the
location of the meeting and a recording of the meeting is posted
on the association's website;
(3) must be audible to the public at the location specified in
the notice under Subdivision (2); and
(4) must provide two-way audio communication between all members
of the board attending the meeting during the entire meeting, and
if the two-way audio communication link with members attending
the meeting is disrupted so that a quorum of the board is no
longer participating in the meeting, the meeting may not continue
until the two-way audio communication link is reestablished.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 22, eff. June 19, 2009.
Sec. 2210.106. IMMUNITY OF DIRECTOR OR OFFICER FROM LIABILITY.
(a) A director or officer of the association is not individually
liable for an act or failure to act in the performance of
official duties in connection with the association.
(b) Subsection (a) does not apply to:
(1) an act or failure to act of the association or an employee
of the association;
(2) an act or omission involving a motor vehicle; or
(3) an act or failure to act that constitutes bad faith,
intentional misconduct, or gross negligence.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.107. PRIMARY BOARD OBJECTIVES. The primary objectives
of the board of directors are to ensure that the association:
(1) operates in accordance with this chapter and commissioner
rules;
(2) complies with sound insurance principles; and
(3) meets all standards imposed under this chapter.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 23, eff. June 19, 2009.
SUBCHAPTER D. PLAN OF OPERATION
Sec. 2210.151. ADOPTION OF PLAN OF OPERATION. With the advice
of the board of directors, the commissioner by rule shall adopt
the plan of operation to provide Texas windstorm and hail
insurance in a catastrophe area.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 24, eff. June 19, 2009.
Sec. 2210.152. CONTENTS OF PLAN OF OPERATION. (a) The plan of
operation must:
(1) provide for the efficient, economical, fair, and
nondiscriminatory administration of the association; and
(2) include:
(A) a plan for the equitable assessment of the members of the
association to defray losses and expenses;
(B) underwriting standards;
(C) procedures for accepting and ceding reinsurance;
(D) procedures for obtaining and repaying amounts under any
financial instruments authorized under this chapter;
(E) procedures for determining the amount of insurance to be
provided to specific risks;
(F) time limits and procedures for processing applications for
insurance; and
(G) other provisions as considered necessary by the department
to implement the purposes of this chapter.
(b) The plan of operation may provide for liability limits for
an insured structure and for the corporeal movable property
located in the structure.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 25, eff. June 19, 2009.
Sec. 2210.153. AMENDMENTS TO PLAN OF OPERATION. (a) The
association may present a recommendation for a change in the plan
of operation to the department at:
(1) periodic hearings conducted by the department for that
purpose; or
(2) hearings relating to property and casualty insurance rates.
(b) The association must present a proposed change to the
department in writing in the manner prescribed by the
commissioner. A proposed change does not take effect unless
adopted by the commissioner by rule.
(c) An interested person may, in accordance with Chapter 2001,
Government Code, petition the commissioner to modify the plan of
operation.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
SUBCHAPTER E. INSURANCE COVERAGE
Sec. 2210.201. DEFINITION OF INSURABLE INTEREST. In this
subchapter, "insurable interest" includes any lawful and
substantial economic interest in the safety or preservation of
property from loss, destruction, or pecuniary damage.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.202. APPLICATION FOR COVERAGE. (a) A person who has
an insurable interest in insurable property may apply to the
association for insurance coverage provided under the plan of
operation and an inspection of the property, subject to any rules
established by the board of directors and approved by the
commissioner. The association shall make insurance available to
each applicant in the catastrophe area whose property is
insurable property but who, after diligent efforts, is unable to
obtain property insurance through the voluntary market, as
evidenced by one declination from an insurer authorized to engage
in the business of, and writing, property insurance providing
windstorm and hail coverage in the first tier coastal counties.
For purposes of this section, "declination" has the meaning
assigned by the plan of operation and shall include a refusal to
offer coverage for the perils of windstorm and hail and the
inability to obtain substantially equivalent insurance coverage
for the perils of windstorm and hail. Notwithstanding Section
2210.203(c), evidence of one declination is also required with an
application for renewal of an association policy.
(b) A property and casualty agent must submit an application for
the insurance coverage on behalf of the applicant on forms
prescribed by the association. The application must contain a
statement as to whether the applicant has submitted or will
submit the premium in full from personal funds or, if not, to
whom a balance is or will be due. Each application for initial
or renewal coverage must also contain a statement that the agent
possesses proof of the declination described by Subsection (a)
and proof of flood insurance coverage or unavailability of that
coverage as described by Section 2210.203(a-1).
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
548, Sec. 2.15, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 26, eff. June 19, 2009.
Sec. 2210.203. ISSUANCE OF COVERAGE; TERM; RENEWAL. (a) If the
association determines that the property for which an application
for insurance coverage is made is insurable property, the
association, on payment of the premium, shall direct the issuance
of an insurance policy as provided by the plan of operation.
(a-1) This subsection applies only to a structure constructed,
altered, remodeled, or enlarged on or after September 1, 2009,
and only for insurable property located in areas designated by
the commissioner. Notwithstanding Subsection (a), if all or any
part of the property to which this subsection applies is located
in Zone V or another similar zone with an additional hazard
associated with storm waves, as defined by the National Flood
Insurance Program, and if flood insurance under that federal
program is available, the association may not issue an insurance
policy for initial or renewal coverage unless evidence that the
property is covered by a flood insurance policy is submitted to
the association. An agent offering or selling a Texas windstorm
and hail insurance policy in any area designated by the
commissioner under this subsection shall offer flood insurance
coverage to the prospective insured, if that coverage is
available.
(b) A policy issued under this section is for a one-year term.
(c) A policy may be renewed annually on application for renewal
as long as the property continues to be insurable property.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 27, eff. June 19, 2009.
Sec. 2210.204. CANCELLATION OF CERTAIN COVERAGE. (a)
Subsections (b) and (c) apply if:
(1) an agent or another person, firm, or corporation finances
the payment of all or a portion of the premium for insurance
coverage;
(2) there is an outstanding balance for the financing of the
premium; and
(3) that balance, or an installment of that balance, is not paid
before the expiration of the 10th day after the due date.
(b) The agent or other person, firm, or corporation to whom the
balance described by Subsection (a) is due may request
cancellation of the insurance coverage by:
(1) returning the policy, with proof that the insured was
notified of the return; or
(2) requesting the association to cancel the insurance coverage
by a notice mailed to the insured and to any others shown in the
policy as having an insurable interest in the property.
(c) On completion of cancellation under Subsection (b), the
association shall refund the unearned premium, less any minimum
retained premium set forth in the plan of operation, to the
person, firm, or corporation to whom the unpaid balance is due.
(d) If an insured requests cancellation of the insurance
coverage, the association shall refund the unearned premium, less
any minimum retained premium set forth in the plan of operation,
payable to the insured and the holder of an unpaid balance. The
property and casualty agent who submitted the application shall
refund the agent's commission on any unearned premium in the same
manner.
(e) For cancellation of insurance coverage under this section,
the minimum retained premium in the plan of operation must be for
a period of not less than 180 days, except for events specified
in the plan of operation that reflect a significant change in the
exposure or the policyholder concerning the insured property,
including:
(1) the purchase of similar coverage in the voluntary market;
(2) sale of the property to an unrelated party;
(3) death of the policyholder; or
(4) total loss of the property.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
548, Sec. 2.16, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 28, eff. June 19, 2009.
Sec. 2210.2041. NONREFUNDABLE SURCHARGE. A nonrefundable
surcharge established under this chapter is not refundable under
this code for any reason or purpose.
Added by Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 29, eff. June 19, 2009.
Sec. 2210.207. WINDSTORM AND HAIL INSURANCE: REPLACEMENT COST
COVERAGE. (a) In this section, "roof covering" means:
(1) the roofing material exposed to the weather;
(2) the underlayments applied for moisture protection; and
(3) all flashings required in the replacement of a roof
covering.
(b) Subject to any applicable deductibles and the limits for the
coverage purchased by the insured, a windstorm and hail insurance
policy issued by the association may include replacement cost
coverage for one- and two-family dwellings, including
outbuildings, as provided under the dwelling extension coverage
in the policy.
(c) If, at the time of loss, the total amount of insurance
applicable to a dwelling is equal to 80 percent or more of the
full replacement cost of the dwelling or equal to the maximum
amount of insurance otherwise available through the association,
coverage applicable to the dwelling under the policy is extended
to include the full cost of repair or replacement, without a
deduction for depreciation.
(d) If, at the time of loss, the total amount of insurance
applicable to a dwelling is equal to less than 80 percent of the
full replacement cost of the dwelling and less than the maximum
amount of insurance available through the association, liability
for loss under the policy may not exceed the replacement cost of
the part of the dwelling that is damaged or destroyed, less
depreciation.
(e) Notwithstanding this chapter or any other law, the
commissioner, after notice and hearing, may adopt rules to:
(1) authorize the association to provide actual cash value
coverage instead of replacement cost coverage on the roof
covering of a building insured by the association; and
(2) establish:
(A) the conditions under which the association may provide that
actual cash value coverage;
(B) the appropriate premium reductions when coverage for the
roof covering is provided on an actual cash value basis; and
(C) the disclosure that must be provided to the policyholder,
prominently displayed on the face of the windstorm and hail
insurance policy.
(f) Notwithstanding Chapter 40, a hearing under Subsection (e)
shall be held before the commissioner or the commissioner's
designee.
(g) The commissioner may adopt rules as necessary to implement
this section.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.208. WINDSTORM AND HAIL INSURANCE: COVERAGE FOR
CERTAIN INDIRECT LOSSES. (a) Except as provided by Subsections
(e) and (f), a windstorm and hail insurance policy issued by the
association for a dwelling, as that term is defined by the
department or a successor to the department, must include
coverage for:
(1) wind-driven rain damage, regardless of whether an opening is
made by the wind;
(2) loss of use; and
(3) consequential losses.
(b) A windstorm and hail insurance policy issued by the
association for tenant contents of a dwelling or other
residential building must include coverage for loss of use and
consequential losses.
(c) The coverage required under Subsection (a) or (b) must be
made:
(1) according to forms approved by the commissioner; and
(2) for a premium paid by the insured based on rates established
by commissioner rule.
(d) The association shall provide coverage under this section as
directed by commissioner rule.
(e) The association is not required to offer coverage for
indirect losses as provided by Subsection (a) or (b) unless that
coverage was excluded from a companion policy in the voluntary
market.
(f) The association is not required to provide coverage for:
(1) loss of use, if the loss is loss of rent or loss of rental
value; or
(2) additional living expenses, if the insured property is a
secondary or a nonprimary residence.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.209. WINDSTORM AND HAIL INSURANCE: COVERAGE FOR
CERTAIN PROPERTY LOCATED OVER WATER. (a) A windstorm and hail
insurance policy issued by the association may include coverage
for:
(1) a building or other structure located in the seacoast
territory that is built wholly or partially over water; and
(2) the corporeal movable property contained in a building or
structure described by Subdivision (1).
(b) The association may impose appropriate limits of coverage
and deductibles for coverage described by Subsection (a).
(c) The board of directors of the association shall submit any
proposed changes to the plan of operation necessary to implement
Subsections (a) and (b) to the commissioner in the manner
provided by Section 2210.153.
(d) The commissioner shall adopt rules as necessary to implement
this section, including any rules necessary to implement changes
in the plan of operation proposed under Subsection (c).
Added by Acts 2007, 80th Leg., R.S., Ch.
730, Sec. 3B.062(a), eff. September 1, 2007.
Added by Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.062(a), eff. September 1, 2007.
SUBCHAPTER F. PROPERTY INSPECTIONS FOR WINDSTORM AND HAIL
INSURANCE
Sec. 2210.251. INSPECTION REQUIREMENTS. (a) Except as provided
by this section, to be considered insurable property eligible for
windstorm and hail insurance coverage from the association, a
structure that is constructed, altered, remodeled, enlarged, or
repaired or to which additions are made on or after January 1,
1988, must be inspected or approved by the department for
compliance with the plan of operation.
(b) After January 1, 2004, for geographic areas specified by the
commissioner, the commissioner by rule shall adopt the 2003
International Residential Code for one- and two-family dwellings
published by the International Code Council. For those
geographic areas, the commissioner by rule may adopt a subsequent
edition of that code and may adopt any supplements published by
the International Code Council and amendments to that code.
(c) After January 1, 2004, a person must submit a notice of a
windstorm inspection to the unit responsible for certification of
windstorm inspections at the department before beginning to
construct, alter, remodel, enlarge, or repair a structure.
(d) A structure constructed, altered, remodeled, enlarged, or
repaired or to which additions were made before January 1, 1988,
that is located in an area that was governed at the time of the
construction, alteration, remodeling, enlargement, repair, or
addition by a building code recognized by the association is
insurable property eligible for windstorm and hail insurance
coverage from the association without compliance with the
inspection or approval requirements of this section or the plan
of operation.
(e) A structure constructed, altered, remodeled, enlarged, or
repaired or to which additions were made before January 1, 1988,
that is located in an area not governed by a building code
recognized by the association is insurable property eligible for
windstorm and hail insurance coverage from the association
without compliance with the inspection or approval requirements
of this section or the plan of operation if the structure was
previously insured by an insurer authorized to engage in the
business of insurance in this state and the structure is in
essentially the same condition as when previously insured, except
for normal wear and tear, and is without any structural change
other than a change made according to code. For purposes of this
subsection, evidence of previous insurance coverage must reflect
coverage for the perils of windstorm and hail for the property
within the 12-month period immediately preceding the date of the
application for coverage through the association and includes:
(1) a copy of a previous insurance policy;
(2) copies of canceled checks or agent's records that show
payments for previous policies; and
(3) a copy of the title to the structure or mortgage company
records that show previous policies.
(f) Notwithstanding any other provision of this section, a
residential structure insured by the association as of September
1, 2009, may continue coverage through the association subject to
the inspection requirements imposed under Section 2210.258.
(g) The department shall issue a certificate of compliance for
each structure that qualifies for coverage. The certificate is
evidence of insurability of the structure by the association.
(h) The department may enter into agreements and contracts as
necessary to implement this section.
(i) The department may charge a reasonable fee to cover the
cost of making building requirements and inspection standards
available to the public.
(j) The department shall charge a reasonable fee for each
inspection of each structure in an amount set by the
commissioner.
(k) Without limitation of the department's authority to
otherwise enforce this chapter, the department shall monitor the
association's compliance with this subchapter.
(l) Except as otherwise provided by this subchapter, the
department may not consider any request that a structure be
certified as insurable property if, within six months after the
final inspection of a structure, the department has not received:
(1) fully completed documentation verifying that the structure
has been constructed, altered, remodeled, enlarged, or repaired,
or any addition to the structure has been made, in compliance
with the plan of operation; and
(2) full payment of all inspection fees owed to the department,
including any fees related to prior department inspections.
(m) If a structure is rejected for coverage under Subsection
(l), a person may make a new request for certification and the
structure may be reinspected for compliance with the plan of
operation. A request for certification brought under this
subsection must meet the requirements of Subsection (l).
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
1408, Sec. 30, eff. September 1, 2009.
Sec. 2210.252. INTERNATIONAL RESIDENTIAL CODE BUILDING
SPECIFICATIONS. (a) After January 1, 2004, for geographic areas
specified by the commissioner, the commissioner by rule may
supplement the plan of operation building specifications with the
structural provisions of the International Residential Code for
one- and two-family dwellings, as published by the International
Code Council or an analogous entity recognized by the department.
(b) For a geographic area specified under Subsection (a), the
commissioner by rule may adopt a subsequent edition of the
International Residential Code for one- and two-family dwellings
and may adopt a supplement published by the International Code
Council or an amendment to that code.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.253. INSURER ASSESSMENT: FIRST TIER COASTAL COUNTY.
(a) In this section, "property insurance" means a commercial or
residential insurance policy prescribed or approved by the
department that provides coverage for windstorm and hail damage,
including a Texas windstorm and hail insurance policy.
(b) The department shall assess each insurer that provides
property insurance in a first tier coastal county in accordance
with this section.
(c) The total assessment under this section in a state fiscal
year must be in the amount estimated by the department as
necessary to cover the administrative costs of the windstorm
inspection program under Section 2210.251 to be incurred in the
first tier coastal counties in that fiscal year.
(d) The assessment must be based on each insurer's proportionate
share of the total extended coverage and other allied lines
premium received by all insurers for property insurance in the
first tier coastal counties in the calendar year preceding the
year in which the assessment is made.
(e) The commissioner shall adopt rules to implement the
assessment of insurers under this section.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.254. QUALIFIED INSPECTORS. (a) For purposes of this
chapter, a "qualified inspector" includes:
(1) a person determined by the department to be qualified
because of training or experience to perform building
inspections;
(2) a licensed professional engineer who meets the requirements
specified by commissioner rule for appointment to conduct
windstorm inspections; and
(3) an inspector who:
(A) is certified by the International Code Council, the Building
Officials and Code Administrators International, Inc., the
International Conference of Building Officials, or the Southern
Building Code Congress International, Inc.;
(B) has certifications as a buildings inspector and coastal
construction inspector; and
(C) complies with other requirements specified by commissioner
rule.
(b) A windstorm inspection may be performed only by a qualified
inspector.
(c) Before performing building inspections, a qualified
inspector must be approved and appointed or employed by the
department.
(d) The department may charge a reasonable fee for the filing of
applications by and determining the qualifications of persons for
appointment as qualified inspectors.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.255. APPOINTMENT OF LICENSED ENGINEER AS INSPECTOR.
(a) On request of an engineer licensed by the Texas Board of
Professional Engineers, the commissioner shall appoint the
engineer as an inspector under this subchapter not later than the
10th day after the date the engineer delivers to the commissioner
information demonstrating that the engineer is qualified to
perform windstorm inspections under this subchapter.
(b) The commissioner shall adopt rules establishing the
information to be considered in appointing engineers under this
section.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2210.256. DISCIPLINARY PROCEEDINGS REGARDING APPOINTED
INSPECTORS. (a) After notice and hearing, the department may
revoke an appointment made under Section 2210.254 if the
appointee is found to be in violation of this subchapter or a
rule of the commissioner adopted under this subchapter.
(b) The commissioner, instead of revocation, may impose one or
more of the following sanctions if the commissioner determines
from the facts that the sanction would be fair, reasonable, or
equitable:
(1) suspension of the appointment for a specific period, not to
exceed one year;
(2) issuance of an order directing the appointee to cease and
desist from the specified activity or