CHAPTER 2301. POLICY FORMS
INSURANCE CODE
TITLE 10. PROPERTY AND CASUALTY INSURANCE
SUBTITLE I. POLICY FORMS IN GENERAL
CHAPTER 2301. POLICY FORMS
SUBCHAPTER A. POLICY FORMS GENERALLY
Sec. 2301.001. PURPOSE. The purposes of this subchapter are to:
(1) promote the availability of insurance;
(2) regulate the insurance forms used for lines of insurance to
which this subchapter applies to ensure that the forms are not
unjust, unfair, inequitable, misleading, or deceptive; and
(3) provide regulatory procedures for the maintenance of
appropriate information reporting systems.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.002. DEFINITIONS. In this subchapter:
(1) "Form" means an insurance policy form or a printed
endorsement form.
(2) "Residential property insurance" means insurance coverage
against loss to real or tangible personal property at a fixed
location that is provided through a homeowners insurance policy,
including a tenants insurance policy, a condominium owners
insurance policy, or a residential fire and allied lines
insurance policy.
(3) "Supporting information" means any information required by
the department to be filed.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.003. APPLICABILITY OF SUBCHAPTER. (a) This
subchapter applies to:
(1) an insurer to which Article 5.13 applies, other than the
Texas Windstorm Insurance Association, the FAIR Plan Association,
and the Texas Automobile Insurance Plan Association; and
(2) except as provided by Subsections (c) and (d), a Lloyd's
plan, reciprocal or interinsurance exchange, and county mutual
insurance company with respect to the lines of insurance
described by Subsection (b).
(b) This subchapter applies to all lines of the following kinds
of insurance written under an insurance policy or contract issued
by an insurer authorized to engage in the business of insurance
in this state:
(1) general liability insurance;
(2) residential and commercial property insurance, including
farm and ranch insurance and farm and ranch owners insurance;
(3) personal and commercial casualty insurance, except as
provided by Section 2301.005;
(4) medical professional liability insurance;
(5) fidelity, guaranty, and surety bonds other than criminal
court appearance bonds;
(6) personal umbrella insurance;
(7) personal liability insurance;
(8) guaranteed auto protection (GAP) insurance;
(9) involuntary unemployment insurance;
(10) financial guaranty insurance;
(11) inland marine insurance;
(12) rain insurance;
(13) hail insurance on farm crops;
(14) personal and commercial automobile insurance;
(15) multi-peril insurance; and
(16) identity theft insurance issued under Chapter 706.
(c) Section 2301.009 does not apply to a Lloyd's plan or a
reciprocal or interinsurance exchange with respect to commercial
property insurance.
(d) This subchapter does not apply to a Lloyd's plan or
reciprocal or interinsurance exchange with respect to inland
marine insurance, rain insurance, or hail insurance on farm
crops.
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.071(b), eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch.
921, Sec. 9.071(b), eff. September 1, 2007.
Sec. 2301.004. EXEMPTION FOR LARGE RISKS. Sections 2301.006,
2301.007(a) and (b), and 2301.008 do not apply to forms for use
with an insured that has:
(1) total insured property values of $5 million or more;
(2) total annual gross revenues of $10 million or more; or
(3) a total premium of $25,000 or more for property insurance,
$25,000 or more for general liability insurance, or $50,000 or
more for multiperil insurance.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.005. REGULATION OF INLAND MARINE FORMS. The
commissioner shall adopt rules governing the manner in which
forms for the various classifications of risks insured under
inland marine insurance, as determined by the commissioner, are
regulated.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.006. FILING AND APPROVAL OF FORMS. (a) Except as
provided by Section 2301.008, an insurer may not deliver or issue
for delivery in this state a form for use in writing insurance
described by Section 2301.003 unless the form has been filed with
and approved by the commissioner.
(b) An insurer must file the form not later than the 60th day
before the date an insurer uses the form or delivers the form for
use.
(c) A filed form is approved at the expiration of 60 days after
the date the form is filed unless the commissioner by order
approves or disapproves the form during the 60-day period. The
commissioner's approval of a filed form constitutes a waiver of
any unexpired portion of the 60-day period.
(d) The commissioner may extend by not more than 10 days the
60-day period described by Subsection (c) during which the
commissioner may approve or disapprove a form filed by an
insurer. The commissioner shall notify the insurer of the
extension before the expiration of the 60-day period.
(e) A filed form for which an extension has been granted under
Subsection (d) is considered approved at the expiration of the
extension period described by that subsection absent an earlier
approval or disapproval of the form.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.007. DISAPPROVAL OF FORMS; WITHDRAWAL OF APPROVAL.
(a) The commissioner may disapprove a form filed under Section
2301.006 or withdraw approval of a form if the form:
(1) violates any law, including a rule adopted under this code;
or
(2) contains a provision or has a title or heading that is
unjust or deceptive, encourages misrepresentation, or violates
public policy.
(b) For good cause shown, the commissioner may withdraw approval
of a form after notice and hearing.
(c) An order issued by the commissioner disapproving a form, or
a notice of the commissioner's intention to withdraw approval of
a form, must state the grounds for the disapproval or withdrawal
of approval in sufficient detail to reasonably inform the insurer
of those grounds.
(d) An order of withdrawal of approval of a form takes effect on
the date prescribed by the commissioner in the order. The
commissioner may not prescribe a date earlier than the 30th day
after the effective date of the order, as prescribed by the
commissioner.
(e) An insurer may not use a form in this state after the
commissioner disapproves the form or withdraws approval of the
form.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.008. ADOPTION AND USE OF STANDARD FORMS. The
commissioner may adopt standard insurance policy forms, printed
endorsement forms, and related forms other than insurance policy
forms and printed endorsement forms, that an insurer may use
instead of the insurer's own forms in writing insurance subject
to this subchapter.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.009. PUBLIC INSPECTION OF INFORMATION. Each filing
made, and any supporting information filed, under this subchapter
is open to public inspection as of the date of the filing.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
SUBCHAPTER B. POLICY FORMS FOR PERSONAL AUTOMOBILE
INSURANCE COVERAGE AND RESIDENTIAL PROPERTY INSURANCE COVERAGE
Sec. 2301.051. DEFINITIONS. In this subchapter:
(1) "Insurer" means an insurance company, reciprocal or
interinsurance exchange, mutual insurance company, capital stock
insurance company, county mutual insurance company, Lloyd's plan,
or other legal entity authorized to write personal automobile
insurance or residential property insurance in this state. The
term includes an affiliate, as described by this code, that is
authorized to write and is writing personal automobile insurance
or residential property insurance in this state. The term does
not include:
(A) the Texas Windstorm Insurance Association;
(B) the FAIR Plan Association; or
(C) the Texas Automobile Insurance Plan Association.
(2) "Personal automobile insurance" means automobile insurance
coverage for the ownership, maintenance, or use of a private
passenger, utility, or miscellaneous type motor vehicle,
including a motor home, trailer, or recreational vehicle, that
is:
(A) owned or leased by one or more individuals; and
(B) not primarily used for the delivery of goods, materials, or
services, other than for use in farm or ranch operations.
(3) "Residential property insurance" means insurance coverage
against loss to tangible personal property or to residential real
property at a fixed location that is provided through a
homeowners insurance policy, including a tenants insurance
policy, a condominium owners insurance policy, or a residential
fire and allied lines insurance policy.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.052. REGULATION OF POLICY FORMS AND ENDORSEMENTS. (a)
Notwithstanding any other provision of this code and except as
provided by this section, Subchapter A applies to an insurer with
respect to insurance policy forms and endorsements for personal
automobile insurance and residential property insurance.
(b) An insurer may continue to use an insurance policy form or
endorsement promulgated, approved, or adopted under Article 5.06
or 5.35 before June 11, 2003, on written notification to the
commissioner that the insurer will continue to use the form or
endorsement.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.053. REQUIREMENTS FOR FORMS; PLAIN-LANGUAGE
REQUIREMENT. (a) Each form filed in accordance with this
subchapter must comply with applicable state and federal law.
(b) Each form for a personal automobile insurance policy must
provide the coverages mandated under Subchapters C and D, Chapter
1952, unless the coverages are rejected by the named insured in
the manner provided by those subchapters.
(c) A form may not be used unless the form is written in plain
language. For purposes of this section, a form is written in
plain language if:
(1) the form achieves the minimum score established by the
commissioner on the Flesch reading ease test or an equivalent
test selected by the commissioner; or
(2) at the commissioner's option, the form conforms to the
language requirements in a National Association of Insurance
Commissioners model act relating to plain language.
(d) Subsection (c) does not apply to policy language that is
mandated by state or federal law.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.054. CERTAIN CONTRACTS OR AGREEMENTS PROHIBITED;
REVOCATION OF CERTIFICATE OF AUTHORITY. (a) A contract or
agreement that is not written into an application for personal
automobile insurance coverage and the personal automobile
insurance policy is void and violates this code.
(b) A contract or agreement described by Subsection (a)
constitutes grounds for the revocation of an insurer's
certificate of authority to write personal automobile insurance
in this state.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.
Sec. 2301.055. RULES. The commissioner may adopt reasonable and
necessary rules to implement this subchapter.
Added by Acts 2005, 79th Leg., Ch.
727, Sec. 2, eff. April 1, 2007.