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You are here: Home . rules . 2006 . 0109-059

SUBCHAPTER E. TEXAS WINDSTORM INSURANCE ASSOCIATION Division 7. Inspections for Windstorm and Hail Insurance 28 TAC §5.4606

1. INTRODUCTION. The Commissioner of Insurance proposes new §5.4606, concerning the temporary appointment of qualified inspectors to conduct windstorm inspections in Jefferson and Chambers counties pursuant to Insurance Code Article 21.49 §6A. Temporary appointees will be authorized to perform inspections of residential structures that may be considered insurable property for windstorm and hail insurance, but will be limited to re-roof inspections of residential structures during the construction process. As a result of the destruction caused by Hurricane Rita along the Texas coast, certain counties, and in particular Jefferson and Chambers counties, are facing massive rebuilding and repair of residential and commercial structures. In the Beaumont area alone, approximately 90% of the residential structures are damaged, and the residents are suffering delays in repair of these structures because of the overwhelming demand for windstorm inspections and the lack of qualified inspectors to meet this demand. Inspectors employed by the department are receiving over 100 inspection applications per day. The department has temporarily reassigned its inspectors from other areas on the coast, including Corpus Christi, Angleton, and Bay City, to assist in meeting this demand, and the department's current appointees who perform inspections are responding primarily to the requests for inspections of commercial buildings. As a result, there are long delays for inspections of the vast majority of the residential structures in Jefferson and Chambers counties; these delays continue to adversely impact the ability of residents to rebuild and repair their damaged homes. The department has determined that this lack of availability of willing and qualified inspectors necessitates this proposal to enable the Commissioner to appoint persons with the experience and training that the department has determined is sufficient for qualified inspectors on a temporary basis to respond to residents in the two counties most affected and most in need. The proposed new rule specifies the experience and training of persons eligible to apply for a temporary appointment and outlines the requirements, financial interest prohibitions, and application process for a temporary appointment. The issuance of a temporary appointment to a qualified inspector will only authorize re-roof inspections of residential property in Jefferson and/or Chambers counties; such re-roof inspections must be conducted during the construction process and may not be conducted after completion of the re-roofing process. The proposed expiration date for a temporary appointment is December 31, 2006, unless extended by the department based on demonstrated need in Jefferson or Chambers counties. The temporary appointees will be subject to the provisions of the department's current rule §5.4604 relating to the appointment of engineers as qualified inspectors, including oversight by the department. The temporary appointees will also be subject to the emergency cease and desist provisions of the Insurance Code as provided in proposed subsection (m). This is necessary to ensure that improper inspections are halted as quickly as possible to prevent approval of faulty or inadequate re-roofing of residential structures, which could result in certification of structures that do not meet windstorm building code requirements and also additional harm to the damaged areas in Jefferson and Chambers counties.

The department will consider the adoption of proposed new §5.4606 in a public hearing under Docket Number 2634, scheduled for 10:30 o'clock, a.m. on February 15, 2006, in Room 102 of the William P. Hobby, Jr. State Office Building, 333 Guadalupe Street, Austin, Texas.

2. FISCAL NOTE. Alexis Dick, Deputy Commissioner for the Inspections Division, has determined that, for each year of the first five years the proposed new section is in effect, there will be no fiscal impact on state or local government as a result of enforcing or administering the section. Ms. Dick has also determined that there will be no measurable effect on local employment or the local economy.

3. PUBLIC BENEFIT/COST NOTE. Ms. Dick has further determined that for each year of the first five years the proposed new section is in effect, the public benefit anticipated as a result of administering and enforcing the section will be to ensure that qualified inspectors are available to respond to residents in hurricane damaged areas most affected and most in need of re-roofing during the period of rebuilding, namely Jefferson and Chambers counties. The department expects that these temporary appointments will result in the relatively prompt availability of persons who are willing and qualified to perform windstorm re-roof inspections on structures to be considered insurable property for windstorm and hail insurance. Texans benefit from a strong and prompt recovery from devastating natural events like Hurricane Rita. The department anticipates that the supply and demand for windstorm inspections in damaged areas will determine the market price of needed inspections; any consumer complaints or other information, however, concerning abusive pricing practices will be carefully reviewed and appropriate action will be taken if necessary. There are no persons who are required to comply with the proposed new section. The anticipated costs to persons who choose to apply for a temporary appointment will be the time to complete the application and obtain the required documents to submit with the application. It is difficult to estimate an exact cost for this time as it is uncertain as to which persons who are eligible will actually participate in this voluntary temporary appointment process. However, eligible persons who are interested in applying for a temporary inspector appointment will be able to estimate their individual costs. There are no application or other fees required under the proposed new section. The department expects no differential impact between small, large, and micro-businesses that decide to participate in this temporary appointment process. The cost per hour of labor for the application process should not vary between small, large, and micro-businesses of the same type. Further, it is neither legal nor feasible to exempt small or micro-businesses or to waive compliance considering the purpose of the statute, which requires windstorm inspections to be performed by a qualified inspector who must be approved and appointed or employed by the department to perform building inspections.

4. REQUEST FOR PUBLIC COMMENT. To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on February 20, 2006, to Gene C. Jarmon, General Counsel and Chief Clerk, Mail Code 113?2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714?9104. An additional copy of the comments must be submitted simultaneously to Alexis Dick, Deputy Commissioner, Inspections Division, Mail Code 103-1A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714?9104.

5. STATUTORY AUTHORITY. The new section is proposed pursuant to the Insurance Code Article 21.49 §6A and §36.001. Article 21.49 §6A provides that a windstorm inspection may only be performed by a qualified inspector who must be approved and appointed or employed by the department to perform building inspections. Section 6A also provides that a qualified inspector includes a person determined by the department to be qualified to perform building inspections because of training or experience and an inspector who is certified by the International Code Council, the Building Officials and Code Administrators International, Inc., the International Conference of Building Officials, or the Southern Building Code Congress International, Inc. who has certifications as a buildings inspector and coastal construction inspector and who also complies with other requirements specified by rule by the commissioner. Section 36.001 provides that the Commissioner of Insurance may adopt any rules necessary and appropriate to implement the powers and duties of the Texas Department of Insurance under the Insurance Code and other laws of this state.

6. CROSS REFERENCE TO STATUTE. The following statute is affected by this proposal:

Rule Number Statute

§5.4606 Insurance Code Article 21.49

7. TEXT.

§5.4606. Requirements for Temporary Appointment of Qualified Inspectors.

(a) The purpose of this section is to specify qualifications, requirements, and procedures pursuant to the Insurance Code Article 21.49 §6A(d) for the appointment for a temporary period of persons to perform windstorm re-roof inspections of residential structures in Jefferson and/or Chambers counties of Texas. Persons appointed under this section must meet the qualifications for appointment under this section and shall perform inspections in accordance with the provisions of this section, §§5.4001 - 5.4010 of this title relating to the Texas Windstorm Insurance Association plan of operation, §§5.4601 - 5.4605 of this title relating to inspections for windstorm and hail insurance, and the Insurance Code Article 21.49 §6A. The following persons are eligible to apply for a Temporary Appointment as a Qualified Inspector:

(1) A person who is certified as a coastal construction inspector by the International Code Council and who has at least two years of construction, design or inspection experience on buildings or structures located in high wind areas; this may include a person employed full-time by a municipality of this state who meets the qualifications as stated in this paragraph; or

(2) A Texas registered architect with construction, design or inspection experience on buildings or structures located in high wind areas; or

(3) Any person with experience, education, or training in programs at an accredited university which shall include at a minimum successful completion of at least two years of technical or university training in the field of civil or architectural engineering, the field of architecture, or the field of construction technology or construction science and at least two years of construction, design or inspection experience on buildings or structures located in high wind areas.

(b) For the purposes of this section, the following words and terms shall have the following meanings:

(1) Commissioner - Commissioner of Insurance of the State of Texas .

(2) Department - Texas Department of Insurance.

(3) Person - An individual and includes a resident or non-resident of this state.

(4) Re-roof - The process of recovering or replacing an existing roof covering and includes the following terms:

(A) Roof covering - The covering applied to a roof deck for weather resistance, fire classification or appearance.

(B) Roof deck - The flat or sloped surface not including its supporting members or vertical supports.

(C) Roof recover - The process of installing an additional roof covering over a prepared roof covering without removing the existing roof covering.

(D) Roof replacement - The process of removing the existing roof covering, repairing any damaged substrate and installing a new roof covering.

(5) Temporary appointee - A person who has been issued a Temporary Appointment as a Qualified Inspector under this section.

(c) A person applying for a temporary appointment under this section must complete and file an application for Temporary Appointment as a Qualified Inspector on a form prepared, maintained, and obtainable from the department.

(d) Persons applying under the requirements of paragraph (1) of subsection (a) of this section shall also affirm to the Commissioner through a sworn statement the current, active, and good-standing status of their certification and/or shall also provide a Certification of Employment affidavit from the municipality as applicable.

(e) Persons applying under the requirements of paragraph (2) of subsection (a) of this section shall also affirm to the Commissioner through a sworn statement the current, active, and good-standing status of the architect's registration through the Texas Board of Architectural Examiners.

(f) Persons applying under the requirements of paragraph (3) of subsection (a) of this section shall also provide a certified copy of a completed degree, if any, certificate, or transcript.

(g) A temporary appointee shall not have a financial interest either directly or indirectly in or be employed by a business that is financially interested either directly or indirectly in the furnishing of labor, material, or appliances for the construction, alteration, or maintenance of any building, nor have current employment or accept compensation or accept other employment or compensation during the period of appointment which could reasonably be expected to impair the temporary appointee's independence of judgment in the performance of inspections pursuant to this section.

(h) A temporary appointee shall comply with and utilize all windstorm inspection forms required by §5.4604 of this title relating to appointment of engineers as qualified inspectors, with such forms modified to substitute "qualified inspector" for "engineer" as applicable.

(i) Except as otherwise provided in this section, a temporary appointee shall be subject to all provisions of §5.4604 of this title including oversight by the department as specified in subsection (h) of §5.4604. If there is a conflict between the provisions of this section and the provisions of §5.4604 of this title, this section shall control.

(j) A temporary appointee is prohibited from delegating the duties under this section to any other person. The delegation/assistance provision of subsection (g)(5) of §5.4604 of this title shall not apply to a temporary appointee,

(k) A temporary appointee is only authorized to perform in Jefferson and Chambers counties re-roof inspections of residential structures during the construction process on risks that could be considered insurable property for windstorm and hail insurance. No other types of inspections by temporary appointees will be considered valid for purposes of the Insurance Code Article 21.49.

(l) A Temporary Appointment as a Qualified Inspector issued under this section shall be valid until December 31, 2006 , unless extended by the department based on demonstrated need in Jefferson or Chambers counties.

(m) In addition to any other remedy available under Insurance Code Article 21.49 §6A, and Chapters 82 and 84, and §5.4604 of this title relating to appointment of engineers as qualified inspectors, the department may issue an emergency cease and desist order pursuant to Insurance Code Chapter 83 to any person who violates any provision of this subchapter or any other rule or statute relating to inspections of structures to be considered insurable property for windstorm and hail insurance.

(n) If a court of competent jurisdiction holds that any provision of this section is inconsistent with any statutes of this state, is unconstitutional, or is invalid for any reason, the remaining provisions of this section shall remain in effect.



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