Bill Text: TX SB1164 | 2015-2016 | 84th Legislature | Introduced
Bill Title: Relating to insurance agents' ownership and use of certain information related to general property and casualty insurance policies; authorizing administrative penalties; adding provisions that may be subject to a criminal penalty.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2015-03-18 - Co-author authorized [SB1164 Detail]
Download: Texas-2015-SB1164-Introduced.html
| 84R11363 PMO-F | ||
| By: Hancock | S.B. No. 1164 | |
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| relating to insurance agents' ownership and use of certain | ||
| information related to general property and casualty insurance | ||
| policies; authorizing administrative penalties; adding provisions | ||
| that may be subject to a criminal penalty. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Chapter 4051, Insurance Code, is amended by | ||
| adding Subchapter J to read as follows: | ||
| SUBCHAPTER J. AGENTS' OWNERSHIP INTERESTS | ||
| Sec. 4051.451. DEFINITIONS. In this subchapter: | ||
| (1) "Expiration" means policy information and records | ||
| related to a property and casualty insurance policy or an | ||
| application for a property and casualty insurance policy, | ||
| including: | ||
| (A) the name and address of the applicant or | ||
| insured; | ||
| (B) the location and description of any property | ||
| referenced in the application or covered by the policy; | ||
| (C) the value, inception date, renewal date, and | ||
| expiration date of the policy; | ||
| (D) the premium, policy limits, and description | ||
| of the terms and coverage of the policy; and | ||
| (E) information or records that may be: | ||
| (i) necessary for placing insurance | ||
| coverage, insurance products, or insurance services; or | ||
| (ii) used to solicit, sell, or negotiate | ||
| the renewal or sale of insurance coverage, insurance products, or | ||
| insurance services. | ||
| (2) "Person" means an individual, partnership, | ||
| corporation, limited liability company, or depository institution. | ||
| (3) "Record" has the meaning assigned by Section | ||
| 322.002, Business & Commerce Code. | ||
| Sec. 4051.452. APPLICABILITY OF SUBCHAPTER. (a) This | ||
| subchapter applies with respect to expirations concerning coverage | ||
| of a risk located in this state, or an application for such | ||
| coverage, issued by or placed with an insurer engaged in the | ||
| business of property and casualty insurance in this state, | ||
| including: | ||
| (1) a stock fire or casualty company; | ||
| (2) a mutual fire or casualty company; | ||
| (3) a Mexican casualty company; | ||
| (4) a Lloyd's plan; | ||
| (5) a reciprocal or interinsurance exchange; | ||
| (6) a county mutual insurance company; | ||
| (7) a farm mutual insurance company; | ||
| (8) a risk retention group; | ||
| (9) the Medical Liability Insurance Joint | ||
| Underwriting Association under Chapter 2203; | ||
| (10) the Texas Windstorm Insurance Association under | ||
| Chapter 2210; | ||
| (11) the Texas Automobile Insurance Plan Association | ||
| under Chapter 2151; and | ||
| (12) an eligible surplus lines insurer. | ||
| (b) This subchapter applies only to ownership and use of an | ||
| expiration by an agent who: | ||
| (1) holds a contract with the insurer to whom the | ||
| relevant application was submitted or that issued the relevant | ||
| insurance policy; or | ||
| (2) has the authority to contract with or submit an | ||
| application for coverage to that insurer. | ||
| Sec. 4051.453. EXCLUSIVE OWNERSHIP AND USE. (a) Except as | ||
| provided by Section 4051.454, an agent or surplus lines agent | ||
| exclusively owns and has exclusive use of an expiration directly | ||
| related to an insurance application submitted by or an insurance | ||
| policy written through the agent for the purpose of soliciting, | ||
| selling, or negotiating the renewal or sale of property and | ||
| casualty insurance coverage, a property and casualty insurance | ||
| product, or a property and casualty insurance service. | ||
| (b) Nothing in this subchapter may be construed to modify or | ||
| amend or require modification or amendment of a contract between an | ||
| insurer and an agent or the authority of the insurer or agent with | ||
| respect to each other. | ||
| Sec. 4051.454. EXCEPTIONS; INSURER OR MANAGING GENERAL | ||
| AGENT. Notwithstanding Section 4051.453, an insurer or the | ||
| insurer's managing general agent may use an expiration: | ||
| (1) to solicit, sell, or negotiate the sale or renewal | ||
| of property and casualty insurance coverage, a property and | ||
| casualty insurance product, or a property and casualty insurance | ||
| service with the written consent of the agent who owns the | ||
| expiration; | ||
| (2) in the normal course of business, including | ||
| underwriting, handling claims, and negotiating reinsurance; or | ||
| (3) if the insured or a property and casualty agent on | ||
| behalf of the insured requests that the insurer renew a policy or | ||
| issue other insurance coverage to the insured. | ||
| Sec. 4051.455. EXCEPTIONS; CERTAIN AGENTS. (a) This | ||
| subchapter does not apply to an expiration related to an insurance | ||
| policy placed or an application for an insurance policy received by | ||
| an agent who: | ||
| (1) has agreed by contract to act exclusively for one | ||
| insurer or group of affiliated insurance companies; | ||
| (2) has agreed in writing with an insurer that all | ||
| expirations, insurance policies, and insurance business is owned by | ||
| the insurer and not the agent; | ||
| (3) is in default for nonpayment of premium or other | ||
| money due under the agent's contract or other agreement with the | ||
| insurer or group of affiliated insurance companies unless a bona | ||
| fide, good faith dispute exists concerning the money due; | ||
| (4) has a suspended, revoked, surrendered, or | ||
| terminated license; or | ||
| (5) has misappropriated, converted to the agent's own | ||
| use, or illegally withheld money belonging to an insurer, an | ||
| insured, or an applicant for insurance. | ||
| (b) The rights of an agent described by Subsection (a)(1) | ||
| with respect to expirations are determined by the agent's contract | ||
| with the insurer or group of affiliated insurance companies. | ||
| Sec. 4051.456. PRIVACY RIGHT OF APPLICANT OR INSURED NOT | ||
| IMPAIRED. An applicant's or insured's right to privacy related to | ||
| an expiration is not impaired or affected by an agent's ownership of | ||
| the expiration. | ||
| Sec. 4051.457. COMPLAINT RESOLUTION PROGRAM. The | ||
| department shall establish a program to resolve complaints of | ||
| violations of this subchapter. | ||
| Sec. 4051.458. ENFORCEMENT; SANCTIONS AND PENALTIES | ||
| AUTHORIZED. (a) The commissioner may impose sanctions as provided | ||
| by Chapter 82 against a person who the commissioner finds violated | ||
| this subchapter. | ||
| (b) The commissioner may use the cease and desist procedures | ||
| authorized by Chapter 83 against a person who the commissioner | ||
| finds violated this subchapter. | ||
| (c) In addition to a sanction authorized by this subchapter, | ||
| the commissioner may impose an administrative penalty in accordance | ||
| with Chapter 84 against a person who the commissioner finds | ||
| violated this subchapter. | ||
| SECTION 2. This Act applies only to an expiration related to | ||
| an insurance policy placed or an application for an insurance | ||
| policy received by an agent on or after the effective date of this | ||
| Act. A policy placed or an application received before the | ||
| effective date of this Act is governed by the law as it existed | ||
| immediately before that date, and that law is continued in effect | ||
| for that purpose. | ||
| SECTION 3. This Act takes effect September 1, 2015. | ||
