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You are here: Home . bulletins . 2005 . b-0045-05
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COMMISSIONER'S BULLETIN # B-0045-05

September 14, 2005


To: ALL INSURANCE COMPANIES, CORPORATIONS, EXCHANGES, MUTUALS, RECIPROCALS, ASSOCIATIONS, LLOYDS, OR OTHER INSURERS WRITING PROPERTY AND CASUALTY INSURANCE IN THE STATE OF TEXAS AND TO AGENTS AND REPRESENTATIVES AND THE PUBLIC GENERALLY


Re: Hurricane Katrina - An Extraordinary Event; Rating or Underwriting actions for Property and Casualty coverages due solely to participation in relief efforts

On September 9, 2005, Commissioner's Bulletin B-0044-05, concerning changes in classification of Commercial Auto vehicles from local to intermediate or long haul, cancellation or nonrenewal of policies or refusal to provide coverage due solely to participation in the Hurricane Katrina relief effort was issued. That bulletin advised that efforts to assist Hurricane Katrina victims should not be the sole cause for rating changes.

It has come to the attention of the Texas Department of Insurance (TDI) that certain carriers may be contemplating changes in classification or rating, cancellation or nonrenewal of policies, or refusal to provide coverage due solely to participation in the Hurricane Katrina relief effort in other lines of Property and Casualty insurance. The TDI is of the opinion that in instances where insureds or potential insureds are temporary participants in the relief effort of Hurricane Katrina, it is inappropriate for insurers to re-rate, cancel, nonrenew, or refuse to provide coverage due solely to that participation.

On September 1, 2005, Governor Perry issued a proclamation certifying that Hurricane Katrina, a disaster in sister states, has created an emergency disaster and emergency conditions for the people in the State of Texas beginning September 1, 2005.

Insurance Code Article 1.02(b) requires that rates used under the Code be just, fair, and reasonable. Article 5.13-2 requires that rates not be unreasonable. In the current disaster circumstances, it is the TDI's opinion that it is not reasonable to change policyholders' rating classifications and increase their insurance rates solely because they are assisting in disaster relief.

Questions regarding this bulletin may be directed to the P&C Actuarial Division, at (512) 305-8125 or kathy.poppe@tdi.state.tx.us.

Mike Geeslin
Commissioner of Insurance



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Last updated: 09/16/2014

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