CHAPTER 5, SUBCHAPTER L, ARTICLE 5.96
The Commissioner of Insurance (Commissioner) adopted amendments to the Texas Statistical Plan For Residential Risks (Stat Plan) as proposed by the staff of the Texas Department of Insurance (Staff).
The Commissioner has jurisdiction over this matter pursuant to Insurance Code, Article 5.96 and §§38.204 and 38.207. Article 5.96 authorizes the Commissioner to prescribe, promulgate, adopt, approve, amend, or repeal standard and uniform manual rules, rating plans, classification plans, statistical plans and policy and endorsement forms for fire and allied lines of insurance. Section 38.204 provides that a designated statistical agent shall collect data from reporting insurers under a statistical plan adopted by the Commissioner. Section 38.207 authorizes the Commissioner to adopt rules necessary to accomplish the purposes of the subchapter regarding statistical data collection.
The adopted amendments allow the reporting of experience relating to the use of recently approved residential policy forms. The adopted amendments add options to the Policy Forms field of the Stat Plan. The new options for this field are:
A FP-7955 TX (State Farm Homeowners Policy Form).
B FP-7954 TX (State Farm Renters Policy Form).
C FP-7956 TX (State Farm Condo Policy Form).
D HO-3RTX (USAA Homeowners policy Form).
E HO-6RTX (USAA Condo Policy Form).
F HO 00 02 (ISO Homeowners 2-Broad Form).
G HO 00 03 (ISO Homeowners 3-Special Form).
H HO 00 04 (ISO Homeowners 4-Contents Broad Form).
I HO 00 05 (ISO Homeowners 5-Comprehensive Form).
J HO 00 06 (ISO Homeowners 6-Unit Owners Form).
K HO 00 08 (ISO Homeowners 8-Modified Coverage Form).
As additional policy forms are approved, Staff will add options to this field for the reporting of experience related to the use of such policy forms.
The adopted amendments also add two new fields. One field is to report the actual dollar amount of the deductible associated with a particular policy and the other is to indicate whether wind coverage is included. These new fields are available for both the recently approved policy forms mentioned above as well as for existing policy forms. The current deductible field remains in place for companies that are not able to make system changes necessary to report the actual dollar amount of a deductible.
The adopted amendments also edit existing fields to allow for reporting buy-back endorsements pertaining to foundation, water, and other specified coverage and for reporting the amount of coverage purchased.
In addition, the adopted amendments make changes to the Stat Plan to eliminate the Protection Key Rate field, to delete invalid Deductible Type Codes, to correct Type of Loss Codes, and to expand the types of submission media to include electronic media types that are currently available.
Staff's petition (Ref. P-0702-30-I) proposing the amendments was filed with the Chief Clerk of the Texas Department of Insurance (Department) on July 31, 2002, and notice of the filing was published in the August 9, 2002 issue of the Texas Register (27 Tex Reg 7193).
The Department received comments from one commenter. The commenter asserted that because the new policy forms are not currently subject to a benchmark rate it is not possible for them to provide the required information for the flex fields. The commenter suggested adding specific instructions to the Stat Plan that code 100 be used in any applicable flex field where a benchmark rate has not been promulgated for a given policy form. Staff agrees with instructing the use of code 100, but disagrees with the commenter's suggested language which lists by policy number the policies that do not have a benchmark rate. Instead the Staff has amended the flex field instructions to include the following: "If there is not a promulgated benchmark rate, code 100".
The commenter also raised the concern that company-specific information provided under the Stat Plan be kept confidential. The department shares this concern and will comply with the provisions of the Public Information Act concerning the confidentiality of company-specific data.
The amendments as adopted by the Commissioner are filed with the Department's Chief Clerk under Ref. No. P-0702-30-I and are incorporated by reference by Commissioner's Order 02-0954.
Consistent with the Insurance Code, Article 5.96(h), prior to the effective date of this action, the Department will notify all insurers writing the affected lines of insurance in this state of this action.
This notification is made pursuant to the Insurance Code, Article 5.96, which exempts action taken under this article from the requirements of the Administrative Procedure Act (Government Code, Title 10, ch. 2001).
IT IS THEREFORE THE ORDER of the Commissioner of Insurance that the amendments to the Texas Statistical Plan for Residential Risks as described herein, be adopted to be effective for fourth quarter 2002 experience reporting for all affected insurers.