Certificates of Insurance a Priority Legislative Issue for Texas Agents
With a massive hole in the state’s budget and the duty to redistrict, insurance issues are likely to be low priority items for Texas 82nd Legislature, which began its session in January. But Texas agents are backing insurance-related measures they hope will garner strong support from lawmakers.
One of the major issues the Independent Insurance Agents of Texas would like to see legislators tackle during the 2011 session is the use of Certificates of Insurance.
Sen. John Corona of Dallas, the chair of the Senate Business & Commerce Committee, has introduced SB 425, relating to Certificates of Insurance, and the IIAT expects a companion bill to be filed by Rep. Kelly Hancock of Fort Worth, a member of the House Insurance Committee.
Corona’s bill would require that property/casualty certificate of insurance forms to be approved by the Texas Department of Insurance and provides penalties if unapproved forms are used. It also clarifies that a “certificate of insurance is not a policy of insurance and does not amend, extend, or alter the coverage afforded by the referenced insurance policy.”
The IIAT’s stance is that agents are often asked to provide certificates for commercial insurance customers that are not approved by TDI or are not standard industry forms. Such situations place agents in jeopardy of being asked to certify or interpret the availability of coverage that is uncertain, according to the agents’ association.
Under Corona’s bill, an agent or insurance company that attempts to alter or amend an approved certificate form could be subject to civil penalties. In addition, the insurance department could charge a filing fee of up to $100 when a form is filed for approval.
Other bills supported or proposed by IIAT include:
- HB 625, regarding staff leasing services loss information;
- Legislation that would reduce the business margins tax and retain the small-business tax exemption of $1 million;
- Measures that would increase agents’ involvement in the state’s health insurance exchange under the federal Patient Protection and Affordable Care act and allow agents to be justly compensated for their assistance and advice; and
- Legislation that would change certain licensing requirements for non-resident corporations and partnerships.