Texas Developments

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The 88th Regular Session (2023) of the Texas Legislature voted to enact Senate Bill 833 (“SB 833”), ‎‎which aims to prohibit ‎insurers operating in Texas from using environmental, social, or governance ‎‎‎(“ESG”) models, ‎scores, factors, or standards to charge different rates to businesses or risks in the ‎‎same class ‎facing essentially the same hazards.‎ Because of the divergent approach states have ‎taken regarding ESG issues, SB 833 may present unique challenges for insurance companies ‎operating across ‎multiple jurisdictions. To navigate this complex landscape, insurance companies ‎need to develop ‎flexible strategies ‎that can accommodate the contrasting regulatory expectations in ‎the states coined ‎‎“anti-ESG” versus the “pro-ESG” states. This scenario not only involves ‎managing ‎legal and compliance ‎risks but also managing reputational risks.…

The Texas Department of Insurance (“TDI”) adopted a new group capital calculation filing requirement that is effective on November 7, 2022.  The new rule, found in 28 Texas Administrative Code   §7.215 (“Section 7.215”), is based on the National Association Insurance Commissioners (“NAIC”) model regulation that requires an insurer’s ultimate control person in an insurance holding company system to file a group capital calculation concurrently with the insurer’s annual registration (Form B).…

On June 17, 2022, the Texas Supreme Court released an opinion in Hegar v. Health Care Serv. Corp. (No. 21-0080) (Jun 17, 2022) regarding whether the Comptroller properly taxed an insurer based on premiums it received from sales of stop-loss insurance policies under Texas Insurance Code Chapters 222 and 257.…

The Texas Department of Insurance (“TDI”) adopted new administrative rules for reciprocal reinsurers that took effect on January 1, 2022. According to TDI, the goal of the new reinsurance regulations is to “ensure TDI retains its authority to regulate credit for reinsurance matters associated with covered agreements, align TDI’s rules with the current approach to regulate reserve financing arrangements for certain life insurance policies, and align TDI’s rules with updates to the National Association of Insurance Commissioners’ (NAIC) accreditation requirements.”…

A special data call for the top 10 auto insurance groups in Texas may be on the horizon. On June 26, 2020, the Texas Office of Public Insurance Counsel (OPIC) issued a letter to the Texas Department of Insurance (TDI) requesting a special data call due to the impact of the Coronavirus pandemic on auto insurance-related risks.…