Texas Register, Volume 28, Number 14, Pages 2821-2988, April 4, 2003 Page: 2,875
2821-2988 p. ; 28 cm.View a full description of this periodical.
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(1) The Governing Committee may undertake a public educa-
tion program to assure that the services of the Association receive ade-
quate public attention. The Governing Committee may adopt a written
program for decreasing the overall utilization of the Association as a
source of insurance. The Association may adopt depopulation plans to
reduce the number of risks insured by the Association.
(m) The Governing Committee shall exercise all of the Asso-
ciation's powers not delegated to others pursuant to this plan of opera-
tion.
(n) The Governing Committee may propose amendments to
the plan of operation to the Commissioner for approval.
5.9913. Authority of Agents and Commissions.
(a) Upon request, an agent, may assist any owner of residential
property in completion and submission of an application for insurance
on forms prescribed by the Association.
(b) No agent, even if licensed to represent one or more member
insurers of the Association with respect to policies not underwritten by
the Association, shall hold himself out as an agent of the Association.
(c) A commission shall be paid pursuant to a commission
schedule set by the Governing Committee and approved by the
Commissioner. The commission shall be based on paid gross written
premiums and subject to adjustment based on policy changes and
cancellations. The agent shall remit the gross premium collected on
an Association policy to the Association, and the Association will pay
the commission.
(d) The Association shall establish minimum requirements
and performance standards for agents who submit applications to the
Association or renew business in the Association. These requirements
and standards shall be designed to ensure the efficient transmission
of applications, forms, notices, and money from the agent to the
Association and visa versa, ensure the efficient operation of the Asso-
ciation, and the efficient and convenient servicing of applicants and
policyholders. The Association may require that agents demonstrate
and certify compliance with these requirements and standards. The
Association shall have the power to bar an agent from submitting new
applications to or renewing business in the Association if the agent
refuses to demonstrate and certify compliance with these requirements
and standards or the agent violates any of these requirements or
standards. Such minimum requirements and performance standards
shall be binding upon any agent as a condition of such agent's request
for an inspection, submission of an application, receipt of commissions
from the Association, or other act in connection with the Association.
The Association may contract with agents who meet the Association's
standards and may limit applications to the Association to those
agents. The Association shall not be required to appoint agents.
(e) The Association may limit communications with agents to
website communications only.
(f) An applicant may only apply to the Association through an
agent.
5.9914. Maximum Limits of Liability and Limitations.
(a) The maximum limits of liability for residential property
insurance per location through the Association shall be $1,000,000
dwelling - $500,000 contents. The Association is authorized to rein-
sure some or all risks that are within or at these maximum limits.
(b) The Association may not provide windstorm and hail in-
surance coverage for a risk eligible for that coverage under Insurance
Code Article 21.49.
(c) The Association may issue a policy that includes coverage
for an amount in excess of a liability limit set forth in subsection (a) ofthis section, if the Association first obtains, from a reinsurer approved
by the Commissioner, reinsurance for the full amount of policy expo-
sure above the limits for any given type of risk.
(d) The premium charged by the Association for the excess
coverage shall be equal to the amount of the reinsurance premium
charged to the Association by the reinsurer, plus any payment to the
Association that is approved by the Commissioner.
5.9915. Inspections.
(a) The underwriting rules shall determine the inspection cri-
teria for risks to be written by the Association. The Association may
issue a policy of residential property insurance on certain types of risks
without an inspection in accordance with the underwriting rules.
(b) An inspection shall be made only of property requiring an
inspection to determine eligibility for Association coverage in accor-
dance with the underwriting rules. The inspection shall be free of
charge to the applicant. An inspection request may be made by the
owner, his/her representative, or an agent.
(c) All inspection reports shall be in writing and shall contain
the information necessary to determine eligibility for coverage pursuant
to the Association's underwriting rules. After the inspection report has
been completed, a copy of the completed inspection report and any pho-
tograph indicating the pertinent features of the building construction,
maintenance, and occupancy shall be sent within ten days to the Asso-
ciation.
(d) The inspection report shall contain information describing:
(1) occupancy,
(2) information necessary for underwriting and rating,
(3) construction; and
(4) physical deficiencies.
(e) If an interior inspection is necessary to determine eligibility
of property described in an application submitted to the Association,
the inspector shall contact the applicant and arrange for the applicant
to be present during the inspection. The inspector shall not recommend
correction of physical deficiencies or advise the applicant whether the
Association will provide coverage.
(f) The Association shall, as soon as practical but not to exceed
thirty days after receipt of the inspection report, advise the applicant
and agent of the following:
(1) If the inspector finds that the residential property meets
the underwriting rules, the Association shall notify the applicant in
writing and issue a policy or binder.
(2) The Association shall indicate to the applicant any con-
dition charges that have been applied by the Association in accordance
with 5.9917(h) of this subchapter (relating to Application, Binder,
Policy Issuance, Renewal and Cancellation.)
(3) If the residential property is not insurable based on the
underwriting rules, the Association shall notify the applicant in writing
why the residential property is not insurable.
(g) If, at any time, the applicant makes improvements in the
residential property or its condition that the applicant believes are suf-
ficient to make the residential property insurable, an inspector shall
reinspect the residential property upon request. The applicant for res-
idential property insurance shall be eligible for one reinspection any
time within 60 days after the initial inspection. If upon reinspection
the residential property meets the Association's underwriting rules, the
Association shall notify the applicant in writing and issue a policy or
binder.PROPOSED RULES April 4, 2003 28 TexReg 2875
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Texas. Secretary of State. Texas Register, Volume 28, Number 14, Pages 2821-2988, April 4, 2003, periodical, April 4, 2003; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth101027/m1/54/: accessed June 6, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.