28 TAC §5.4606
The Commissioner of Insurance adopts §5.4606, concerning
the temporary appointment of qualified inspectors to conduct inspections of
residential structure re-roofing in Jefferson and Chambers counties, pursuant
to Insurance Code Article 21.49 §6A, for purposes of insurability for
windstorm and hail insurance from the Texas Windstorm Insurance Association
(TWIA). The new section is adopted without changes to the proposed text as
published in the January 20, 2006, issue of the
Texas Register
(31 TexReg 372). The new section was considered in a
public hearing on February 15, 2006 under Docket Number 2634.
The purpose of TWIA is to provide windstorm and hail insurance coverage
to residents and businesses in the designated catastrophe areas along the
Texas coast that are unable to obtain such coverage in the voluntary market.
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. Both
Jefferson and Chambers counties are first tier coastal counties for purposes
of Insurance Code Article 21.49, and are therefore subject to significant
windstorm and hail damage from any hurricane hitting in that area of the Texas
coast. In the Beaumont area alone (Jefferson County), approximately 90% of
the residential structures received some type of damage, and as a result of
the tremendous volume of repairs being performed on structures after the storm,
there is an overwhelming demand for windstorm inspections and certifications.
Under the Insurance Code Article 21.49 §6A, the inspections and certifications
are necessary for the structures to be considered insurable property for windstorm
and hail insurance from the TWIA. Repair work in these counties will be a
long-term process. To assist with the enormous workload of windstorm inspections,
the Texas Department of Insurance (Department) has temporarily reassigned
its inspectors from other areas on the coast, including Corpus Christi, Angleton,
and Bay City, and the TWIA is also providing additional inspection assistance
through independent contract inspectors. Even though the number of inspections
performed by engineers appointed as qualified inspectors has risen in comparison
to the first few months after the storm, and despite the re-assignment of
the Department's inspectors and the TWIA contract with independent inspectors,
additional qualified inspectors continue to be needed on a temporary basis
to meet the increasing demand of requests for inspections by contractors,
roofers and homeowners for certification of structures. New §5.4606 is
necessary to provide for the qualifications, requirements, and procedures
for the appointment of the needed additional qualified inspectors on a temporary
basis to conduct re-roof inspections of residential structures during the
construction process in Jefferson and Chambers counties, the two counties
most affected and most in need. Any inspectors appointed pursuant to new §5.4606
will be able to inspect residential re-roofing in these counties to confirm
compliance with windstorm building code standards which will aid in reducing
future damage and losses from wind and hail. This will benefit the homeowners,
TWIA, insurers, and the state of Texas. The inspection authority granted to
the temporary appointees will be limited to inspections of residential re-roofing
during the construction process. To ensure that the inspections are conducted
properly and in accordance with statutory and regulatory requirements, it
is necessary that the temporary appointees be subject to oversight by the
Department and the other provisions of the Department's current §5.4604,
relating to the appointment of engineers as qualified inspectors. In addition
to any other remedy available under the Insurance Code Article 21.49 §6A
and Chapters 82 and 84, the temporary appointees will also be subject to the
emergency cease and desist provisions of the Insurance Code Chapter 83. This
is necessary to ensure that improper inspections are halted as quickly as
possible to deter 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. This is also necessary to prevent
additional harm in the damaged areas in Jefferson and Chambers counties.
New §5.4606(a) specifies the qualifications, including necessary experience
and training, of persons eligible to apply for a temporary appointment. Subsection
(b) defines terms used throughout the section. Subsections (c) - (f) outline
the application process for a temporary appointment and specify the necessary
forms, affidavits, and other documents needed for application. Subsection
(g) specifies financial interest prohibitions for applicants and temporary
appointees. Subsection (h) requires that temporary appointees comply and utilize
certain specified windstorm inspection forms. Subsection (i) provides that
temporary appointees will be subject to the provisions of the Department's
current §5.4604, relating to the appointment of engineers as qualified
inspectors, including oversight by the Department. Subsection (j) prohibits
temporary appointees from delegating any duties that are part of the authorization
of their temporary appointment. Subsection (k) provides that the issuance
of a temporary appointment to a qualified inspector only authorizes re-roof
inspections of residential structures in Jefferson and/or Chambers counties
during the construction process and provides that no other types of inspections
by temporary appointees will be valid for purposes of windstorm and hail insurance
under the Insurance Code Article 21.49. Subsection (l) provides that the expiration
date for a temporary appointment is December 31, 2006, unless extended by
the Department based on demonstrated need in Jefferson or Chambers counties.
Subsection (m) provides that temporary appointees will be subject to the provisions
of the Department's current §5.4604, relating to the appointment of engineers
as qualified inspectors, including oversight by the Department, and will also
be subject to the emergency cease and desist provisions of the Insurance Code
Chapter 83. Subsection (n) contains a severability clause which provides for
the continuation of non-affected provisions of the rules if any provisions
are declared invalid.
Comment: One commenter stated support for the rule.
Agency Response: The Department appreciates the commenter's support for
the rule.
For: Office of Public Insurance Counsel.
The new section is adopted 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. (all now known as the International
Code Council) 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.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on March 1, 2006.
TRD-200601301
Gene C. Jarmon
General Counsel and Chief Clerk
Texas Department of Insurance
Effective date: March 21, 2006
Proposal publication date: January 20, 2006
For further information, please call: (512) 463-6327