Governor Greg Abbott has issued a disaster declaration in response to the COVID-19 pandemic. The premium for many commercial property and casualty policies are calculated using an auditable exposure such as payroll or sales. Because of the impact the COVID-19 outbreak has had on Texas businesses, the Texas Department of Insurance (TDI) expects insurers to work with commercial policyholders that have reduced operations due to the COVID-19 outbreak.
For policies calculated using an auditable exposure that may have changed as a result of the COVID-19 outbreak, TDI encourages insurers to:
- Conduct midterm premium audits if requested by policyholders. Many policies allow midterm audits and do not require an onsite audit.
- Allow policyholders to self-audit and report changes in the auditable exposure the company used to calculate the premium.
- Consider any reduced risk for businesses that change operations or elect to continue paying employees when they are not working.
- Make other adjustments to reduce the premium as appropriate.
A midterm audit, self-audit, or other premium adjustment does not replace a final audit permitted or required by the policy.
For questions about this bulletin, contact the Property and Casualty Division at PropertyCasualty@tdi.texas.gov.