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ICT's Weekly Legislative Roundup

 The House Insurance Comittee met twice last week, hearing and voting out bills of interest to ICT 

On April 2, the committee heard several ICT priority bills, including House Bill 3689 by Rep. Hunter, which proposes a new catastrophe funding structure for TWIA. The bill is a refile of House Bill 1588 by Rep. Oliverson from the 88th Legislature. It eliminates the use of public securities and other debt instruments to fund TWIA losses and replaces them with a new structure. The bill authorizes TWIA to enter into catastrophe financing arrangements with the state through the comptroller, up to $500 million in pre-event funding and up to $1 billion in post-event funding. The commissioner, in consultation with the TWIA board, would have the authority to order a catastrophe surcharge to repay these financing arrangements. ICT testified in support of the bill. In addition to industry support, the bill also received backing from various coastal stakeholders, including Realtor associations and the Texas Association of Builders. It was voted out of the House Insurance Committee during its formal meeting on April 3.

House Bill 1576 by Rep. Oliverson, which would create a state grant program for hurricane and windstorm mitigation, was also heard and left pending. ICT testified in support.

ICT registered in support—but did not testify—on the following bills:

• HB 2517 (Barry) – Exempts TWIA and the FAIR Plan from premium and maintenance taxes (TWIA biennial recommendation)

• HB 2518 (Barry) – Prohibits TWIA’s premium financing arrangements (TWIA biennial recommendation)

• HB 2841 (Smithee) – Relates to FORTIFIED homes and TWIA underwriting statutes

• HB 3508 (Wharton) – Removes on-site audit requirement for TPAs
  
  

At its April 3 formal meeting, in addition to HB 3689, the committee also voted out:

• Committee Substitute for HB 2067 (Paul) – Companion to Senate Bill 1006 (Middleton), which has passed the Senate. The bill implements TDI’s biennial recommendation to require notice for nonrenewal, cancellation and declination. The House version differs from the Senate version by excluding workers’ compensation, requiring that notices be sent to the independent agent rather than the policyholder or applicant (if an agent is used), and removing ESG/DEI provisions added by a Senate floor amendment. ICT continues to work with bill authors to refine the language to align with member concerns.
  
  

• Committee Substitute for HB 2275 (Morgan) – Companion to Senate Bill 455 (Middleton), related to surplus lines arbitration. The Senate companion was voted out of the Senate Business and Commerce Committee on March 31. The substitute requires that surplus lines contracts for risks located entirely in Texas include arbitration provisions that: (1) mandate arbitration in Texas (unless both parties agree otherwise and the insurer provides a premium credit for venue-related costs), and (2) require Texas law to govern both arbitration and contract interpretation.

Senate Business & Commerce votes out bills of interest

The Senate Business & Commerce Committee met on April 1 and voted out the following bills of interest previously heard in committee:

• CSSB 458 (Schwertner) – The committee substitute to SB 458, which mandates appraisal provisions in specified policies, passed 10-0. CSSB 458 includes ICT’s suggested language to make appraisals binding except in cases of fraud, accident or material mistake, and grants TDI rulemaking authority over appraisal timelines, qualifications and procedures. It also protects existing policy forms with appraisal provisions from requiring refiling under the new law.
  
  

• SB 1238 (Kolkhorst) – SB 1238 prohibits insurers from discriminating against individuals based on their marital status after the death of a spouse. Specifically, insurers cannot deny coverage, limit benefits or charge different rates because an individual is widowed. The bill was voted out 9-0 and recommended for the Local and Uncontested Calendar.
  
  

• CSSB 1644 (Schwertner) – This is OPIC’s biennial recommendation that insurers using credit scores in underwriting or rating must use a credit report that is no more than 90 days old when issuing or renewing a policy, and must review and update the insured’s credit score at least every 36 months to adjust premiums accordingly. The committee substitute voted out includes language that adds notice of this statutory change to the adverse action notice portion of the statute. The bill was voted out 11-0 and recommended for the Local and Uncontested Calendar.
  
  

• CSSB 1791 (Middleton) – The substitute to SB 1791 mandates that personal auto policies include a provision requiring insurers to attempt communication with an insured at least five times, or until the insured responds, within 45 days following a third-party liability claim. If the insurer is unable to communicate with the insured, it is obligated to pay the claim and decline to renew the policy. The committee substitute was voted out 9-0 and recommended for the Local and Uncontested Calendar.
  
  

Notably, Chairman Schwertner’s SB 1642 (creating a three-member TDI commission) and SB 1643 (implementing prior approval) were not voted out of committee. ICT has met with every Business & Commerce Committee member to express its opposition and has joined with other trade groups in developing one-pagers outlining key concerns.

 Other committee hearings with key bills 

Several bills of interest moved through Senate committees this week. The Senate State Affairs Committee heard SB 30 (Hughes), the TLR-backed noneconomic damages bill. ICT registered in support, and the bill was left pending. SB 34 (Sparks), which proposes increasing the statutory cap on insurer assessments for volunteer fire departments (VFDs) from $30 million to $40 million, was considered by the Senate Water, Agriculture and Rural Affairs Committee and also left pending.

Meanwhile, SB 868 (Sparks) was heard in the Senate Finance Committee. As filed, the bill would have removed the assessment cap entirely, but the committee substitute narrowed the bill by removing the assessment portion and instead requiring that at least 10% of appropriated VFD funds go to departments in high-risk wildfire areas. The substitute was voted out of committee.

House committee advances AI regulation bill

Chairman Capriglione introduced a committee substitute to HB 149, the AI regulation bill, which was voted out of the House Committee on Government Efficiency and Reform. The substitute incorporates language submitted by ICT to clarify the distinct anti-discrimination standard under the Insurance Code and affirms the commissioner’s enforcement authority over insurance-regulated matters.

Committee hearings of interest this week

Several committees will hear bills of interest to ICT this week. On Tuesday, April 8, the Senate Business and Commerce Committee will consider two TWIA-related bills by Sen. Middleton:  SB 2530, a comprehensive omnibus bill addressing funding and probable maximum loss (PML) calculations, and SB 2571, which proposes to cap member assessments at 33% of the PML for a catastrophe year.

That same day, the House Licensing and Administrative Procedures Committee will hear HB 2983 (Cook), which would increase fees related to vehicle storage.

The commercial vehicle litigation cleanup bills will be heard in both chambers on Wednesday, April 9. The House Judiciary and Civil Jurisprudence Committee will hear HB 4688 (Leach), and the Senate Transportation Committee will hear SB 39 (Birdwell).

Also on Wednesday, the House Insurance Committee will take up eight ICT-priority bills, including measures related to oral release in auto claims, credit scoring bans and the widow penalty.

Early Bird Registration

2025 ICT Property & Casualty Insurance Symposium

When: September 17-18, 2025

Where: Renaissance Austin Hotel, Austin, TX

The ICT Property & Casualty Insurance Symposium is your must-attend event for the latest legislative updates, emerging trends, and networking opportunities. Early Bird Registration is open — secure your discounted tickets!

2025 ICT Workers' Compensation Conference

When: September 15-16, 2025

Where: Renaissance Austin Hotel, Austin, TX

Join us at the 2025 ICT Workers' Comp Conference for expert insights on mental health, AI in claims, fraud prevention, and more. Early Bird Registration is open—don’t miss your chance to save on your tickets!

 ICT in the News: 

The 5 Worst Hail Storms In North Texas History

Dallas Observer

 Industry News: 

Study: ‘Tort tax’ costs Texans an average of $1,725 per year

Southeast Texas Record

A new study reveals that excessive lawsuits and large court verdicts cost Texans an average of $1,725 per year, surpassing the national average. Texans Against Lawsuit Abuse (TALA) warns that these legal costs drive up prices on everyday necessities, from groceries to insurance. Lawmakers are considering reforms, including Senate Bill 30, to address so-called “nuclear verdicts” that have cost Texas billions.

Key Points:

• Lawsuit Costs: Texans pay an average of $1,725 annually due to lawsuits, with some regions seeing even higher costs.

• Economic Impact: Legal expenses contribute to $33.6 billion in direct costs and over 450,000 job losses in Texas.

• Nuclear Verdicts: Texas led the nation in court awards exceeding $10 million, totaling over $45 billion from 2009 to 2023.

• Legislative Action: Senate Bill 30, a priority for Lt. Gov. Dan Patrick, aims to curb excessive court awards.

• Call for Reform: Advocates argue for medical bill transparency and limits on non-economic damages to ensure fairness in the legal system.

 Industry News: 

What homeowners need to know
as insurance rates surge in Texas

KSAT - San Antonio

Homeowners across Texas are facing rising insurance costs, with some seeing annual increases of $1,000 or more. The Texas Department of Insurance reports that home insurance premiums jumped 21% in 2023, with rates continuing to rise due to severe weather, inflation, and increasing claims. Experts suggest several strategies for homeowners looking to lower their premiums.

Key Points:

• Rising Costs: Texas homeowners paid an average of $2,800 for home insurance in 2023, a 21% increase from the previous year.

• Severe Weather Impact: Billion-dollar storms, hail, windstorms, wildfires, and the 2021 winter freeze have driven up claims and costs.

• Inflation & Home Prices: Higher construction costs and property values have contributed to rising premiums.

• Ways to Save: Homeowners can lower premiums by increasing deductibles, upgrading home systems, or installing security features.

• Shopping for Better Rates: Comparing policies from different insurers or exploring coverage through the Texas FAIR Plan Association can help homeowners find lower rates.

 Industry News: 

Early look at hurricane season predicts over a dozen named storms. But El Niño could change things

CNN

Meteorologists are warning of an above-average hurricane season, with forecasts calling for 17 named storms, nine hurricanes, and four major hurricanes. Colorado State University (CSU) researchers say warm ocean temperatures and shifting climate patterns are key factors in the outlook. While forecasting this early comes with uncertainty, experts stress that conditions favor an active season.

Key Points:

• Above-Average Activity: CSU predicts 17 named storms, including nine hurricanes and four major hurricanes (Category 3 or stronger).

• Warm Oceans Fuel Storms: Record-high Atlantic temperatures create ideal conditions for hurricane formation and rapid intensification.

• ENSO Influence: The El Niño Southern Oscillation is expected to remain neutral, removing a potential factor that could suppress storms.

• Rapid Intensification Risks: Scientists warn that unusually warm waters could lead to storms strengthening rapidly, reducing preparation time.

• Increased Flooding Threat: Heavy rainfall, now the deadliest aspect of hurricanes, is expected to be a major concern this season.

 Industry News: 

Managing the Climate Change-Fueled
Property Insurance Crisis

Center for American Progress 

The United States has faced increasingly severe natural disasters, including devastating wildfires in Los Angeles and catastrophic flooding from Hurricane Helene in 2024. These climate-driven disasters have escalated financial risks, particularly in the insurance market, where rising costs and limited availability are leaving many unprotected. As insurers withdraw from high-risk areas, policymakers must address the growing crisis to ensure insurance remains accessible and affordable.

Key Points:

• In 2024, the U.S. endured 27 billion-dollar weather and climate disasters, causing $183 billion in damage.

• Insurance companies are responding to increased losses by raising premiums, reducing coverage, and exiting high-risk markets.

• Rising insurance costs disproportionately impact low-income communities and communities of color, who are more vulnerable to disasters.

• Government-backed programs, such as FAIR plans and the National Flood Insurance Program, help distribute financial risks but face sustainability challenges.

• Without intervention, worsening climate conditions and a declining insurance market could threaten homeownership, economic stability, and disaster recovery efforts.

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