HBA-NRS H.B. 1891 77(R)BILL ANALYSIS


Office of House Bill AnalysisH.B. 1891
By: Lewis, Glenn
Insurance
7/16/2001
Enrolled



BACKGROUND AND PURPOSE 

Prior to the 77th Legislature, state law allowed an insurance company to
reduce coverage on a personal lines property insurance policy with an
endorsement approved by the commissioner of insurance, but did not require
an insurance company to notify a policyholder of an endorsement to a policy
form. House Bill 1891 requires that a written explanation be provided to a
policyholder if an endorsement is used to reduce coverage under an
insurance policy.   

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 1891 amends the Insurance Code to prohibit an insurer from using
an endorsement to a policy form that reduces the amount of coverage, unless
requested by the insured, that would otherwise be provided under the policy
unless the insurer provides the policyholder with a written explanation of
the change made by the endorsement before the effective date of the change. 

EFFECTIVE DATE

September 1, 2001, and applies only to an endorsement used on or after
January 1, 2002.