CHAPTER 2211. FAIR PLAN
INSURANCE CODE
TITLE 10. PROPERTY AND CASUALTY INSURANCE
SUBTITLE G. POOLS, GROUPS, PLANS, AND SELF-INSURANCE
CHAPTER 2211. FAIR PLAN
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2211.001. DEFINITIONS. In this chapter:
(1) "Association" means the FAIR Plan Association established
under this chapter.
(2) "FAIR Plan" means a Fair Access to Insurance Requirements
Plan established under Section 2211.051.
(3) "Governing committee" means the governing committee of the
association.
(4) "Inspection bureau" means the organization or organizations
designated by the association under Section 2211.153.
(5) "Insurer" means an authorized insurer writing property
insurance in this state, including:
(A) a Lloyd's plan; and
(B) a reciprocal or interinsurance exchange.
(6) "Net direct premiums" means gross direct written premiums
less return premiums on canceled contracts, regardless of
reinsurance assumed or ceded, written on residential property
under this chapter.
(7) "Residential property insurance" means the coverage provided
by a homeowners insurance policy, residential fire and allied
lines insurance policy, or farm and ranch owners insurance policy
against loss incurred to real or tangible personal property at a
fixed location.
(8) "Underserved area" or "underserved areas" means an area or
areas designated as underserved by the commissioner by rule.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.002. IMMUNITY. Liability does not exist on the part
of, and a cause of action does not arise against, an insurer, the
inspection bureau, the association, the governing committee, the
commissioner, an authorized representative of the commissioner,
or an agent or employee of an insurer, the inspection bureau, the
association, or the governing committee for:
(1) an inspection required by this chapter;
(2) an act or omission in connection with an inspection; or
(3) a statement made:
(A) in a report and communication concerning the insurability of
property;
(B) in the determinations required by this subchapter or
Subchapter B, C, D, or F; or
(C) at a hearing conducted in connection with an inspection.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.003. APPEALS; JUDICIAL REVIEW. (a) An applicant or
affected insurer is entitled to appeal to the association. The
association's decision may be appealed to the commissioner not
later than the 30th day after the date of the decision.
(b) An order or decision made by the commissioner under this
chapter is subject to judicial review in accordance with
Subchapter D, Chapter 36.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
SUBCHAPTER B. ESTABLISHMENT AND ADMINISTRATION OF FAIR PLAN
Sec. 2211.051. ESTABLISHMENT OF FAIR PLAN. The commissioner may
establish a Fair Access to Insurance Requirements Plan to deliver
residential property insurance to residents of this state in
underserved areas if the commissioner determines, after a public
hearing, that:
(1) in all or any part of the state, residential property
insurance is not reasonably available in the voluntary market to
a substantial number of insurable risks; or
(2) at least 25 percent of the applicants to the residential
property market assistance program who are qualified under that
program's plan of operation have not been placed with an insurer
in the preceding six months.
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.065(a), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.065(a), eff. September 1, 2007.
Sec. 2211.052. ADMINISTRATION OF FAIR PLAN; COMPOSITION OF
GOVERNING COMMITTEE. (a) The governing committee shall
administer the FAIR Plan under a plan of operation.
(b) The governing committee is composed of 11 members appointed
by the commissioner as follows:
(1) five members who represent the interests of insurers;
(2) four public members who reside in this state; and
(3) two members who are general property and casualty agents.
(c) The commissioner or an employee of the department designated
by the commissioner serves as an ex officio member.
(d) Each member of the governing committee who represents the
interests of insurers must be a full-time employee of an insurer
that is a member of the association.
(e) The commissioner may remove a member of the governing
committee without cause and may replace the member in accordance
with Subsection (b).
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.065(b), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.065(b), eff. September 1, 2007.
Sec. 2211.0521. MEETINGS OF GOVERNING BODY. (a)
Notwithstanding Chapter 551, Government Code, or any other law,
members of the governing committee may meet by telephone
conference call, video conference, or other similar
telecommunication method. The governing committee may use
telephone conference call, video conference, 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 governing committee at the meeting.
(b) A meeting held by telephone conference call, video
conference, or other similar telecommunication method:
(1) is subject to the notice requirements applicable to other
meetings of the governing committee;
(2) may not be held unless notice of the meeting specifies the
location of the meeting at which at least one member of the
governing committee is physically present;
(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 governing committee 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 governing committee is no longer participating in the
meeting, the meeting may not continue until the two-way audio
communication link is reestablished.
Added by Acts 2007, 80th Leg., R.S., Ch.
730, Sec. 3B.065(c), eff. September 1, 2007.
Added by Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.065(c), eff. September 1, 2007.
Sec. 2211.053. AMENDMENTS TO PLAN OF OPERATION. (a) The
governing committee may, on the committee's own initiative or at
the commissioner's request, propose amendments to the plan of
operation.
(b) Amendments to the plan must be adopted by the commissioner
by rule.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.054. CONTENTS OF PLAN OF OPERATION. The plan of
operation must:
(1) provide for a nonprofit association to issue residential
property insurance under this chapter and distribute the losses
and expenses in writing that insurance in this state;
(2) provide that all insurers that write residential property
insurance shall participate in the association in accordance with
Sections 2211.101(b) and (c);
(3) provide that a participating insurer is entitled to receive
credit in accordance with Section 2211.101(d);
(4) provide for the immediate binding of eligible risks;
(5) provide for the use of premium installment payment plans,
adequate marketing, and service facilities;
(6) provide for the establishment of reasonable service
standards;
(7) provide procedures for efficient, economical, fair, and
nondiscriminatory administration of the association;
(8) provide procedures for determining the net level of
participation required for each insurer in the association;
(9) provide for the use of deductibles and other underwriting
devices;
(10) provide for assessment of all members in amounts sufficient
to operate the association;
(11) establish maximum limits of liability to be placed through
the program;
(12) establish commissions to be paid to the insurance agents
submitting applications;
(13) provide that the association issue policies in the
association's own name;
(14) provide reasonable underwriting standards for determining
insurability of a risk;
(15) provide procedures for the association to assume and cede
reinsurance; and
(16) provide any other procedure or operational matter the
governing committee or the commissioner considers necessary.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.055. ASSOCIATION DUTIES WITH RESPECT TO POLICIES. (a)
The association may, for FAIR Plan purposes only:
(1) issue insurance policies and endorsements to those policies
in the association's own name or a trade name adopted for that
purpose; and
(2) act on behalf of all participating insurers in connection
with those policies and act in any other manner necessary to
accomplish the purposes of this chapter, including:
(A) issuing insurance policies;
(B) collecting premiums;
(C) issuing cancellations; and
(D) paying commissions, losses, judgments, and expenses.
(b) In connection with an insurance policy issued by the
association:
(1) service of a notice, proof of loss, legal process, or other
communication with regard to the policy must be made on the
association; and
(2) an action by the insured constituting a claim under the
policy may be brought only against the association, and the
association is the proper party for all purposes in an action
brought under or in connection with the policy.
(c) The requirements of Subsection (b) must be stated in an
insurance policy issued by the association.
(d) The form and content of an insurance policy issued by the
association are subject to the commissioner's approval.
(e) The association may assume and cede reinsurance as provided
by the plan of operation.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.056. FILING AND APPROVAL OF RATES. (a) The
association shall file with the commissioner for approval the
proposed rates and supplemental rate information to be used in
connection with the issuance of insurance policies or
endorsements.
(b) The association shall set rates in an amount sufficient to:
(1) carry all claims to maturity; and
(2) meet the expenses incurred in the writing and servicing of
the business.
(c) Not later than the 60th day after the date the association
files the proposed rates, the commissioner shall enter an order
approving or disapproving, wholly or partly, the proposed rates.
The commissioner may, on notice to the association, extend the
period for entering an order under this section an additional 30
days.
(d) An order disapproving a rate must state:
(1) the grounds for the disapproval; and
(2) the findings in support of the disapproval.
(e) The association may not issue an insurance policy or
endorsement until the commissioner approves the rates to be
applied to the policy or endorsement.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.057. POWERS OF COMMISSIONER. The commissioner is
charged with the authority to supervise the association and the
inspection bureau. The commissioner also has the power to:
(1) examine the operation of the association and the inspection
bureau through free access to all the books, records, files,
papers, and documents relating to the operation of the
association and the inspection bureau;
(2) summon, qualify, and examine as a witness any person who has
knowledge of the operation of the association or the inspection
bureau, including a member of the governing committee or an
officer or employee of the association or the inspection bureau;
(3) take any action necessary to enable this state and the
association to fully participate in any federal reinsurance
program that is enacted for purposes similar to the purposes of
this chapter;
(4) require reports from the association concerning risks the
association insures under this chapter as the commissioner
considers necessary; and
(5) adopt policy forms and endorsements, promulgate rates, and
adopt rating and rule manuals for use by the association.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.058. ANNUAL OPERATING REPORT. (a) Not later than
March 31 of each year, the association shall compile and submit
to the commissioner an operating report covering the preceding
calendar year.
(b) The report is a public record.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.059. ASSETS OF ASSOCIATION. On dissolution of the
association, all assets of the association shall be deposited in
the general revenue fund.
Added by Acts 2007, 80th Leg., R.S., Ch.
730, Sec. 3B.067(a), eff. September 1, 2007.
Added by Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.067(a), eff. September 1, 2007.
SUBCHAPTER C. INSURER PARTICIPATION IN FAIR PLAN
Sec. 2211.101. COVERAGE PROVIDED TO INSUREDS IN UNDERSERVED
AREA. (a) In accordance with the plan of operation, the
association shall develop and administer a program for
participation by each insurer that writes residential property
insurance in this state.
(b) Except as provided by this subsection, each insurer, as a
condition of the insurer's authority to engage in the business of
residential property insurance in this state, shall participate
in the association in accordance with this chapter, including
participating in the association's assessments in the proportion
that the insurer's net direct premiums written in this state
during the preceding calendar year bear to the aggregate net
direct premiums written in this state by all participating
insurers. The Texas Windstorm Insurance Association established
by Chapter 2210 may not participate in the association for any
purpose.
(c) An insurer's participation under Subsection (b) in the
association's assessments must be determined in accordance with
the residential property statistical plan adopted by the
commissioner.
(d) A participating insurer is entitled to receive credit for
similar insurance voluntarily written in an underserved area.
The participation of an insurer entitled to receive credit under
this subsection must be reduced in accordance with the plan of
operation.
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.065(d), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.065(d), eff. September 1, 2007.
Sec. 2211.102. LIABILITY OF INSURERS TO ASSOCIATION;
ASSESSMENTS. The participating insurers are liable to the
association as provided by this chapter and the plan of operation
for the expenses and liabilities incurred by the association as
provided by this chapter and the plan. The association shall
make assessments against the participating insurers as required
to meet those expenses and liabilities.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.103. RECOMPUTATION OF REIMBURSEMENT RATIOS. If a
participating insurer fails to pay an assessment because of the
insurer's insolvency, the association shall immediately recompute
the reimbursement ratios to exclude from the ratios the amount of
that assessment the commissioner determines is uncollectible, so
that the uncollectible amount is assumed by and redistributed
among the remaining participating insurers.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.104. ADDITIONAL ASSESSMENT IN EVENT OF DEFICIT;
PREMIUM SURCHARGE AUTHORIZED. (a) If the association incurs a
deficit, the association, at the commissioner's direction, shall:
(1) request the issuance of public securities as authorized by
Subchapter E; or
(2) assess participating insurers in accordance with this
section.
(b) As reimbursement for assessments paid under this section or
service fees paid under Section 2211.209, each insurer may charge
a premium surcharge on every property insurance policy insuring
property in this state that the insurer issues, the effective
date of which is within the three-year period beginning on the
90th day after the date of the assessment or the 90th day after
the date the service fee under Section 2211.209 is paid, as
applicable.
(c) The insurer shall compute the amount of the surcharge under
Subsection (b) as a uniform percentage of the premium on each
policy described by Subsection (b). The percentage must be equal
to one-third of the ratio of the amount of the participating
insurer's assessment or service fee payment to the amount of the
insurer's direct earned premiums, as reported to the department
in the insurer's financial statement for the calendar year
preceding the year in which the assessment or service fee payment
is made so that, over the three-year period, the aggregate of all
surcharges by the insurer under this section is at least equal to
the amount of the assessment or service fee payment.
(d) The amount of any assessment paid and surcharged under this
section may be carried by the insurer as an admitted asset of the
insurer for all purposes, including exhibition in annual
statements under Section 862.001, until collected.
(e) The commissioner shall adopt rules and procedures as
necessary to implement this section.
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.066(a), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.066(a), eff. September 1, 2007.
Sec. 2211.105. RETENTION AND USE OF PROFITS BY ASSOCIATION. (a)
The association shall retain any profits of the association to
be used for the purposes of the association.
(b) The association:
(1) shall use the profits to mitigate losses, including
purchasing reinsurance and offsetting future assessments; and
(2) may not distribute the profits to insurers.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
SUBCHAPTER D. COVERAGE PROVIDED TO INSUREDS
Sec. 2211.151. MANDATORY COVERAGE PROVIDED TO CERTAIN INSUREDS.
The association shall make residential property insurance
available to each applicant in an underserved area whose property
is insurable in accordance with reasonable underwriting standards
but who, after diligent efforts, is unable to obtain residential
property insurance through the voluntary market, as evidenced by
two declinations from insurers authorized to engage in the
business of, and writing, residential property insurance in this
state.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.152. DESIGNATION OF AREA AS UNDERSERVED. The
commissioner by rule shall designate the areas determined to be
underserved. In determining which areas to designate as
underserved, the commissioner shall consider the factors
specified in Section 2004.002.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.153. INSPECTION BUREAU. The association, with the
approval of the commissioner, shall designate one or more
organizations as the inspection bureau. The inspection bureau
shall:
(1) make inspections to determine the condition of a property
for which residential property insurance is sought; and
(2) perform other duties authorized by the association or the
commissioner.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.154. PROPERTY INSPECTION. (a) A person who has an
insurable interest in real or tangible personal property at a
fixed location in an underserved area and who, after diligent
effort, is unable to obtain residential property insurance, as
evidenced by two current declinations from insurers authorized to
engage in the business of residential property insurance in this
state and actually writing residential property insurance in this
state, is entitled on application to the association to an
inspection and evaluation of the property by representatives of
the inspection bureau.
(b) A general property and casualty agent or personal lines
property and casualty agent may make an application on behalf of
the applicant. The applicant or agent must submit the
application on a form prescribed by the association.
(c) Promptly after the application is received, the inspection
bureau shall make an inspection and file an inspection report
with the association. The inspection report must be made
available to the applicant on request. The association shall
prescribe the manner and scope of the inspection and inspection
report for residential property in accordance with the plan of
operation.
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. 2.17, eff. September 1, 2007.
Sec. 2211.155. INSPECTION RESULTS; REINSPECTION. (a) If, after
an inspection, the inspection bureau determines that residential
property meets the underwriting standards established in the plan
of operation, the applicant must be informed in writing of that
determination and the association shall issue a policy or binder.
If the residential property does not meet the underwriting
standards, the applicant must be informed in writing of the
reason for the failure of the residential property to meet the
standards.
(b) If, at any time, an applicant whose residential property did
not meet the underwriting standards makes improvements to the
property or the property's condition that the applicant believes
are sufficient to make the property meet the standards, an
inspection bureau representative shall reinspect the property on
request. In any case, the applicant is eligible for one
reinspection on or before the 60th day after the date of the
initial inspection.
(c) If, on reinspection, the residential property meets the
underwriting standards, the applicant must be informed in writing
of that fact and the association shall issue a policy or binder.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.156. CERTAIN COVERAGE EXCLUDED. The FAIR Plan may not
provide windstorm and hail insurance coverage for a risk eligible
for that coverage under Chapter 2210.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.157. COVERAGE FOR CERTAIN WINDSTORM AND HAIL DAMAGE;
COVERAGE FOR CERTAIN PROPERTY LOCATED OVER WATER. (a) A policy
issued by the association may include coverage against loss or
damage by windstorm or hail for:
(1) a building or other structure 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 governing committee of the association shall submit any
proposed changes to the plan of operation necessary to implement
Subsections (a) and (b) to the commissioner for the approval of
the commissioner in the manner provided by Section 2211.053.
(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 Subsections (a) and (b).
Added by Acts 2007, 80th Leg., R.S., Ch.
730, Sec. 3B.068(a), eff. September 1, 2007.
Added by Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.068(a), eff. September 1, 2007.
SUBCHAPTER E. REVENUE BOND PROGRAM
Sec. 2211.201. PURPOSE. The legislature finds that issuing
public securities to provide a method to raise funds to provide
residential property insurance in this state through the
association is to benefit the public and to further a public
purpose.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.202. DEFINITIONS. In this subchapter:
(1) "Board" means the board of directors of the Texas Public
Finance Authority.
(2) "Bond" means a debt instrument or other public security
issued by the Texas Public Finance Authority.
(3) "Public security resolution" means the resolution or order
authorizing public securities to be issued under this subchapter.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.203. APPLICABILITY OF OTHER LAWS. The following laws
apply to public securities issued under this subchapter to the
extent consistent with this subchapter:
(1) Chapters 1201, 1202, 1204, 1205, 1231, 1232, and 1371,
Government Code; and
(2) Subchapter A, Chapter 1206, Government Code.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.204. ISSUANCE OF PUBLIC SECURITIES AUTHORIZED. At the
request of the association and subject to Section 2211.205, the
Texas Public Finance Authority shall issue public securities to:
(1) fund the association, including to:
(A) establish and maintain reserves to pay claims;
(B) pay operating expenses; and
(C) purchase reinsurance;
(2) pay costs related to issuing the public securities; and
(3) pay other costs related to the public securities as
determined by the board.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.205. LIMITATION ON AMOUNT OF PUBLIC SECURITIES. The
Texas Public Finance Authority may issue on behalf of the
association public securities in a total amount not to exceed $75
million.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.206. TERMS OF ISSUANCE. (a) Public securities issued
under this subchapter may be issued at a public or private sale.
(b) Public securities must:
(1) be issued in the name of the association; and
(2) mature not more than 10 years after the date issued.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.207. CONTENTS OF PUBLIC SECURITY RESOLUTION;
ADMINISTRATION OF ACCOUNTS. (a) In a public security
resolution, the board may:
(1) provide for the flow of funds and the establishment,
maintenance, and investment of funds and special accounts with
regard to the public securities, including an interest and
sinking fund account, a reserve account, and other accounts; and
(2) make additional covenants with regard to the public
securities and the designated income and receipts of the
association pledged to the payment of the public securities.
(b) The association shall administer the accounts in accordance
with this chapter.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.208. SOURCE OF PAYMENT. (a) Public securities issued
under this subchapter are payable only from:
(1) the service fee established under Section 2211.209; or
(2) other amounts the association is authorized to levy, charge,
and collect.
(b) The public securities are obligations solely of the
association and do not create a pledge, gift, or loan of the
faith, credit, or taxing authority of this state.
(c) Each public security must:
(1) include a statement that the state is not obligated to pay
any amount on the security and that the faith, credit, and taxing
authority of this state are not pledged, given, or loaned to
those payments; and
(2) state on the security's face that the security:
(A) is payable solely from the revenue pledged for that purpose;
and
(B) is not a legal or moral obligation of the state.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.209. SERVICE FEE. (a) A service fee may be assessed
against:
(1) each participating insurer; and
(2) the association.
(b) The commissioner shall set the service fee in an amount
sufficient to pay all debt service on the public securities
issued under this subchapter. Each participating insurer and the
association shall pay the service fee as required by the
commissioner by rule.
(c) The comptroller shall collect the service fee and the
department shall reimburse the comptroller in the manner
described by Section 201.052.
(d) The commissioner, in consultation with the comptroller, may
coordinate payment and collection of the service fee with other
payments made by participating insurers and collected by the
comptroller.
(e) As a condition of engaging in the business of insurance in
this state, a participating insurer agrees that, if the insurer
leaves the property insurance market in this state, the insurer
remains obligated to pay the insurer's share of the service fee
assessed under this section until the public securities are
retired. The amount assessed against an insurer under this
subsection must be:
(1) proportionate to the insurer's share of the property
insurance market, including residential property insurance, in
this state as of the last complete reporting period before the
date the insurer ceases to engage in the property insurance
business in this state; and
(2) based on the insurer's gross premiums for property
insurance, including residential property insurance, for the
insurer's last reporting period.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.210. EXEMPTION FROM TAXATION. Public securities
issued under this subchapter, any interest from the public
securities, and all assets pledged to secure the payment of the
public securities are exempt from taxation by the state or a
political subdivision of this state.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.211. AUTHORIZED INVESTMENTS. Public securities issued
under this subchapter are authorized investments under Subchapter
B, Chapter 424, and Subchapters C and D, Chapter 425.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.212. STATE PLEDGE REGARDING PUBLIC SECURITY OWNER
RIGHTS AND REMEDIES. (a) The state pledges to and agrees with
the owners of public securities issued in accordance with this
subchapter that the state will not limit or alter the rights
vested in the association to fulfill the terms of agreements made
with the owners or impair the rights and remedies of the owners
until the following obligations are fully discharged:
(1) the public securities;
(2) any bond premium;
(3) interest; and
(4) all costs and expenses related to an action or proceeding by
or on behalf of the owners.
(b) The association may include the state's pledge and agreement
under Subsection (a) in an agreement with the owners of the
public securities.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.213. PAYMENT ENFORCEABLE BY MANDAMUS. A writ of
mandamus and any other legal or equitable remedy are available to
a party in interest to require the association or another party
to fulfill an agreement or perform a function or duty under:
(1) this subchapter;
(2) the Texas Constitution; or
(3) a public security resolution.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
SUBCHAPTER F. PENALTIES
Sec. 2211.251. SANCTIONS AND ADMINISTRATIVE PENALTIES. If the
association, the inspection bureau, or a participating insurer is
found to be in violation of or to have failed to comply with this
chapter, that entity is subject to:
(1) the sanctions authorized by Chapter 82; and
(2) administrative penalties authorized by Chapter 84.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2211.252. ADDITIONAL DISCIPLINARY PROCEDURES. In addition
to the remedies provided by Section 2211.251, the commissioner
may use any other disciplinary procedures authorized by this
code, including the cease and desist procedures authorized by
Chapter 83.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.