Part 1.
TEXAS DEPARTMENT OF INSURANCE
Chapter 19.
AGENTS' LICENSING
The Texas Department of Insurance proposes amending §§19.603,
19.802, and 19.1002, and adopting new §§19.701-19.712 concerning
public insurance adjusters. The proposed amendments and new sections are necessary
to implement the public insurance adjuster license type added by the enactment
of Insurance Code Article 21.07-5 by Senate Bill 127, 78th Legislature. The
department has proposed for repeal existing §§19.701 - 19.709 elsewhere
in this issue of the Texas Register.
The proposed sections are necessary to implement Article 21.07-5 and provide
effective regulation of public insurance adjusters. Senate Bill 127 added,
for the first time, licensing requirements for public insurance adjusters
and a structure to regulate the activities of such adjusters, who are defined
in the law as those persons who, for direct, indirect or other compensation,
take certain actions, including negotiating or settling claims on behalf of
insureds for loss or damage under policies of insurance covering real or personal
property. The proposed sections provide further guidance to enhance the requirements
of Article 21.07-5, consistent with the new law's public protection goals,
by establishing requirements for: registering public insurance adjuster trainees
and licensing resident and nonresident corporations, partnerships, and individuals;
maintaining and demonstrating financial responsibility; setting license and
certificate fees; completing continuing education; reporting criminal history
and providing fingerprints; prescribing contract terms; and defining the term
"advertisement" as used in Article 21.07-5.
The proposed amendments to §19.603 remove an obsolete reference to
public insurance adjusters and update references to the department. Proposed §19.701
references definitions of terms used in the proposed new subchapter. Proposed §19.702
establishes the type of public insurance adjuster license. Proposed §19.703
establishes the criteria for registering and renewing temporary training certificates.
Proposed §19.704 references statutory licensing criteria for individuals
and establishes the criteria for licensing corporations and partnerships as
public insurance adjusters.
Proposed §19.705 establishes the financial responsibility requirement
for public insurance adjusters. The requirement is based on the perils that
the financial responsibility must cover under Article 21.07-5, other Insurance
Code financial responsibility requirements, and the type and amount of financial
responsibility required in other states that license public insurance adjusters.
Proposed §19.706 establishes financial responsibility reporting requirements
for public insurance adjusters. Proposed §19.707 establishes the acceptable
type of financial responsibility. These two proposed sections are based on
the department's current procedures and requirements for other license types
that maintain financial responsibility through surety bonds.
Proposed §19.708 establishes public insurance adjuster contract requirements.
Proposed §19.709 establishes criminal history filing requirements for
nonresident public insurance adjuster applicants and clarifies the timing
of the annual nonresident affidavit. Proposed §19.710 establishes criminal
history filing requirements for nonresident persons required to file biographical
information under §19.704. Proposed §19.711 establishes fingerprint
requirements for public insurance adjuster applicants. Proposed §19.712
defines the term "advertisement."
The proposed amendments to §19.802 (b)(20) and (21) establish licensing
and renewal fees for public insurance adjusters and temporary certificate
holders. The proposed amendment to §19.1002 (16) incorporates public
insurance adjusters into the department's existing licensee continuing education
program.
The department will consider the adoption of the proposed amendments to §§19.603,
19.802, 19.1002, and new 19.701-19.712 in a public hearing under Docket No.
2557 on September 18, 2003 at 10:30 a.m. in Room 100 of the William P. Hobby
Jr. State Office Building, 333 Guadalupe, Austin, Texas.
Matt Ray, deputy commissioner, licensing division, has determined that
for the first five years the proposed sections will be in effect, there will
be an increase in revenue to state government in the approximate amount of
$67,500 annually as a result of the enforcement and administration of these
rules due to the initial licensing and biennial license renewal of public
insurance adjusters. Based on an average of licensed adjusters to public insurance
adjusters in other states that have both license types, Mr. Ray anticipates
that approximately 1,250 biennial public insurance adjuster licenses will
be issued during each of the first two years this proposal is in effect with
an application fee of $50 generating $62,500 in annual revenue. During the
third through fifth year the license type is in effect, Mr. Ray anticipates
that the number of original licenses issued by the department will fall to
approximately 500 annually and that renewals will be approximately 750 annually.
This will result in an estimated 1,250 licenses being issued or renewed annually
and generating $62,500 in annual revenue. Mr. Ray further anticipates that
the department will annually issue and renew 100 temporary training certificates
during each year of the first five years this proposal is in effect with an
application and renewal fee of $50 generating $5,000 in annual revenue. As
required by the Texas OnLine Project, a $3 Texas OnLine subscription fee has
been included in the proposed renewal fee, which the department will transfer
to the Texas OnLine Authority for each license renewed. Mr. Ray has determined
that for each year of the first five years the proposed sections will be in
effect, there will be no fiscal impact to local governments as a result of
the enforcement or administration of these rules. There will be no measurable
effect on local employment or the local economy as a result of the proposal.
Mr. Ray has determined that for each year of the first five years the proposed
sections are in effect, the anticipated public benefit as a result of adopting
and administering the sections will be the effective regulation of public
insurance adjusters and protection of persons who contract with a public insurance
adjuster. The anticipated public benefit of the licensing fees assessed in
the proposed rule will be the sufficient coverage of department administration
costs, which include licensure, enforcement of statutory and rule requirements,
disciplinary actions, and market conduct examinations, among other regulatory
protections. The anticipated public benefit of the Texas Online Subscription
fees placed on each renewal will be increased access to state government over
the internet for the public and licensees. The anticipated public benefit
of maintaining financial responsibility is to provide consumers with a potential
source of recovery for a public insurance adjuster's malfeasance, error or
omission. The anticipated public benefit of requiring fingerprint and criminal
history information is that the department will be able to more effectively
evaluate a person's fitness for licensure or to be involved in the management
or control of a licensee.
The probable economic cost to persons required to comply with these sections
will be application and renewal fees for licenses and training certificates,
costs of maintaining and demonstrating financial responsibility, and costs
related to producing fingerprints and criminal history information.
The probable economic costs to comply with the proposed sections establishing
original application, registration, renewal, and examination fees result from
the legislative enactment of Insurance Code Article 21.07-5 and its requirement
that the department adopt fees sufficient to cover the cost of license administration.
Following adoption, the cost for each separate public insurance adjuster license
and each temporary training certificate would be $50 per original application
in each year of the first five years the sections are in effect. The cost
of renewing each public insurance adjuster license would be $50 per biennial
renewal. The cost of renewing each temporary training certificate would be
$50. A portion, $3, of the license renewal fee results from Government Code
Sec. 2054.252, concerning the Texas Online Project, and not the adoption,
enforcement, or administration of the proposed sections. The cost of each
department-administered public insurance adjuster examination or reexamination
would be $50, except where the department contracts with a designated testing
service to administer examinations, in which case the fee shall be the amount
authorized to be charged pursuant to the department's agreement with the testing
contractor.
The probable economic costs to comply with the proposed sections establishing
financial responsibility requirements result from the legislative requirements
of Insurance Code Article 21.07-5 that directs the department to determine
the amount and type of financial responsibility that will cover all of the
perils set forth in Article 21.07-5 §6. The department's bond section
estimates that the annual cost of a surety bond described in the proposal
is 2% of the total bond amount, which is $200 for a $10,000 surety bond. The
probable economic costs to comply with the proposed sections establishing
fingerprint and criminal history reporting requirements result from the legislative
requirements in Insurance Code Article 21.07-5 that require the department
to determine that the applicant is trustworthy and has not been convicted
of a felony. Fingerprint cards are available from the department at no charge.
The department estimates the fee for completion of the cards by a local law
enforcement agency to be $10. Further, the department's testing contractor
will make a set of fingerprints for an applicant at a testing center for the
sum of $17.50. The department estimates that a nonresident may obtain a copy
of his criminal history report for a fee less than $20.
There is no difference in the costs of compliance between a large and small
business as a result of the proposed sections as the costs set forth in these
proposed sections, with the exception of nonresident criminal history information,
apply equally to each licensee.
In addition, the cost of labor per hour is not affected by the proposed
sections and thus there is no disproportionate economic impact on small or
micro-businesses. Further, it is anticipated that substantially all, if not
all, persons affected by the probable economic costs of complying with this
rule will be small businesses or micro-businesses. It is neither legal nor
feasible to waive the requirements of the sections for small or micro-businesses
because doing so would eliminate substantially all of the public benefits
of licensing public insurance adjusters under Article 21.07-5.
To be considered, written comments on the proposal must be submitted no
later than 5 p.m. on September 22, 2003 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 simultaneously submitted to Matt Ray, Deputy Commissioner, Licensing Division,
Mail Code 107-1A, Texas Department of Insurance, P.O. Box 149104, Austin,
Texas 78714-9104.
Subchapter G. LICENSING OF INSURANCE ADJUSTERS
28 TAC §19.603
These sections are proposed under Insurance Code Articles
21.01, 21.01-1, 21.01-2, and 21.07-5, and §§36.001 and 801.056,
and Government Code §2054.252. Article 21.01 §3 provides that Insurance
Code Chapter 21, Subchapter A applies to the listed licensees and §4
authorizes the commissioner to adopt rules to implement the subchapter. Article
21.01-1 §1 authorizes the commissioner to require applicants to take
examinations through a department-designated vendor. Article 21.01-1 §3
authorizes the commissioner to develop a continuing education program for
licensees. Article 21.01-2 §3A authorizes the commissioner to refuse,
deny, revoke or suspend a license or license application. Article 21.07-5 §29
authorizes the department to adopt rules necessary to implement Article 21.07-5
and define the term advertisement. Insurance Code §801.056 authorizes
the commissioner to require applicants to submit a complete set of fingerprints
prior to licensure. Government Code §2054.252 (g) requires the department
to increase licensing fees in an amount sufficient to cover the Texas OnLine
Authority subscription fee cost. Insurance Code §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.
The following statutes are affected by the proposal: Rule No. Statute Insurance
Code Articles 21.07-5, 21.01, 21.01-1, 21.01-1 and 21.07-5 21.01, 21.01-1,
and 21.07-5 §19.803 Government Code §2054.252
§19.603.Interpretations of the Act.
(a)
(No change.)
[
(b)
[
(c)
[
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on August 11, 2003.
TRD-200304978
Gene C. Jarmon
General Counsel and Chief Clerk
Texas Department of Insurance
Earliest possible date of adoption: September 21, 2003
For further information, please call: (512) 463-6327
28 TAC §§19.701 - 19.712
These sections are proposed under Insurance Code Articles
21.01, 21.01-1, 21.01-2, and 21.07-5, and §§36.001 and 801.056,
and Government Code §2054.252. Article 21.01 §3 provides that Insurance
Code Chapter 21, Subchapter A applies to the listed licensees and §4
authorizes the commissioner to adopt rules to implement the subchapter. Article
21.01-1 §1 authorizes the commissioner to require applicants to take
examinations through a department-designated vendor. Article 21.01-1 §3
authorizes the commissioner to develop a continuing education program for
licensees. Article 21.01-2 §3A authorizes the commissioner to refuse,
deny, revoke or suspend a license or license application. Article 21.07-5 §29
authorizes the department to adopt rules necessary to implement Article 21.07-5
and define the term advertisement. Insurance Code §801.056 authorizes
the commissioner to require applicants to submit a complete set of fingerprints
prior to licensure. Government Code §2054.252 (g) requires the department
to increase licensing fees in an amount sufficient to cover the Texas OnLine
Authority subscription fee cost. Insurance Code §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.
The following statutes are affected by the proposal: Rule No. Statute Insurance
Code Articles 21.07-5, 21.01, 21.01-1, 21.01-1 and 21.07-5 21.01, 21.01-1,
and 21.07-5 §19.803 Government Code §2054.252
§19.701.Definitions.
(a)
Words and terms defined in Insurance Code Article 21.07 §1A
shall have the same meaning when used in this subchapter.
(b)
The following words and terms, when used in this subchapter,
shall have the following meanings, unless the context clearly indicates otherwise.
(1)
Corporation--A legal entity that is organized under the
business corporations laws or limited liability company laws of this state,
another state, or a territory of the United States. The licensing and regulation
of a limited liability company is subject to all provisions of this subchapter
that apply to a corporation licensed under this subchapter.
(2)
Partnership--An association of two or more persons organized
under the partnership laws or limited liability partnership laws of this state,
another state, or a territory of the United States. The term includes a general
partnership, limited partnership, limited liability partnership, and limited
liability limited partnership.
(3)
Public Insurance Adjuster--A person licensed under Insurance
Code Article 21.07-5 §§5, 5A, 15 or 15A or §19.704 of this
subchapter (relating to Public Insurance Adjuster Licensing).
§19.702.Type of Public Insurance Adjuster Licenses.
The department shall issue a single public insurance adjuster license
pursuant to Insurance Code Article 21.07-5 and the provisions of this subchapter.
§19.703.Temporary Training Certificates.
(a)
A temporary training certificate applicant must file with
the department a fully completed application, on a form as required by the
commissioner, that is accompanied by the temporary certificate application
fee, proof of financial responsibility and any other information the commissioner
deems necessary.
(b)
An individual may not hold more than two 180-day temporary
training certificates, including renewals, during an 18 month period.
(c)
Except as prohibited in subsection (b) of this section,
an individual may renew a temporary training certificate by filing with the
department 30 days prior to the expiration of an existing temporary training
certificate a fully completed application, on a form as required by the commissioner,
that is accompanied by the temporary certificate renewal fee, proof of financial
responsibility and any other information the commissioner deems necessary.
§19.704.Public Insurance Adjuster Licensing.
(a)
Any individual that desires a public insurance adjuster
license must file with the department a fully completed license application,
on a form as required by the commissioner, and otherwise meet the licensing
qualification requirements of Insurance Code Article 21.07-5 §§5
or 15 and this subchapter.
(b)
Any corporation or partnership that desires a public insurance
adjuster license must file with the department a fully completed license application
on a form as required by the commissioner.
(c)
The department shall issue a license to a resident or nonresident
corporation or partnership if the department finds that:
(1)
the corporation or partnership is:
(A)
organized under the laws of this state or any other state
or territory of the United States;
(B)
admitted to conduct business in this state by the secretary
of state, if required; and
(C)
authorized by its articles of incorporation or its partnership
agreement to act as a public insurance adjuster;
(2)
the corporation or partnership meets the definition of
that entity adopted under Insurance Code Article 21.07 §1A;
(3)
at least one officer of the corporation or one active partner
of the partnership and all other persons performing any acts of a public insurance
adjuster on behalf of the corporation or partnership in this state are individually
licensed by the department separately from the corporation or partnership;
(4)
the corporation or partnership intends to be actively engaged
in the business of public insurance adjusting;
(5)
the corporation or partnership has filed a separate registration
with the department for each location from which it will conduct business
as a public insurance adjuster;
(6)
the corporation or partnership has submitted the application,
appropriate fees, proof of financial responsibility, and any other information
required by the department;
(7)
each officer, director, member, manager, partner, or any
other person who has the right or ability to control the license holder meets
the qualifications for licensure set forth in Insurance Code Article 21.07-5 §§5
and 15; and
(8)
no officer, director, member, manager, partner, or any
other person who has the right or ability to control the license holder has:
(A)
had a license suspended or revoked or been the subject
of any other disciplinary action by a financial or insurance regulator of
this state, another state, or the United States;
(B)
committed an act for which a license may be denied under
Insurance Code Article 21.01-2 or 21.07-5.
(d)
Nothing contained in this section shall be construed to
permit any unlicensed employee or representative of any corporation or partnership
to perform any act of a public insurance adjuster without obtaining a public
insurance adjuster license.
(e)
Each corporation or partnership applying for a public insurance
adjuster license shall file, under oath, on a form developed by the department,
biographical information for each of its executive officers and directors
or unlicensed partners who administer the entity's operations in this state,
and shareholders who are in control of the corporation, or any other partners
who have the right or ability to control the partnership. If any corporation
or partnership is owned, in whole or in part, by another entity, a biographical
form is required for each individual who is in control of the parent entity.
(f)
Each corporation or partnership shall notify the department
not later than the 30th day after the date of:
(1)
a felony conviction of a licensed public insurance adjuster
of the entity or any individual associated with the corporation or partnership
who is required to file biographical information with the department;
(2)
an event that would require notification under Insurance
Code §81.003; and
(3)
the addition or removal of an officer, director, partner,
member, or manager.
(g)
A person may not acquire in any manner any ownership interest
in an entity licensed as a public insurance adjuster under this subchapter
if the person is, or after the acquisition would be directly or indirectly
in control of the license holder, or otherwise acquire control of or exercise
any control over the license holder, unless the person has filed the following
information with the department under oath:
(1)
a biographical form for each person by whom or on whose
behalf the acquisition of control is to be effected;
(2)
a statement certifying that no person who is acquiring
an ownership interest in or control of the license holder has been the subject
of a disciplinary action taken by a financial or insurance regulator of this
state, another state, or the United States;
(3)
a statement certifying that, immediately on the change
of control, the license holder will be able to satisfy the requirements for
the issuance of the public insurance adjuster license; and
(4)
any additional information that the commissioner may prescribe
as necessary or appropriate to the protection of the insurance consumers of
this state or as in the public interest.
(h)
If a person required to file a statement under subsection
(g) of this section is a partnership, limited partnership, syndicate, or other
group, the commissioner may require that the information required by paragraphs
(1)-(4) of that subsection for an individual be provided regarding each partner
of the partnership or limited partnership, each member of the syndicate or
group, and each person who controls the partner or member. If the partner,
member, or person is a corporation or the person required to file the statement
under subsection (g) of this section is a corporation, the commissioner may
require that the information required by paragraphs (1)-(4) of that subsection
be provided regarding:
(1)
the corporation;
(2)
each individual who is an executive officer or director
of the corporation; and
(3)
each person who is directly or indirectly the beneficial
owner of more than 10 percent of the outstanding voting securities of the
corporation.
(i)
The department may disapprove an acquisition of control
if, after notice and opportunity for hearing, the commissioner determines
that:
(1)
immediately on the change of control the license holder
would not be able to satisfy the requirements for the public insurance adjuster
license;
(2)
the competence, trustworthiness, experience, and integrity
of the persons who would control the operation of the license holder are such
that it would not be in the interest of the insurance consumers of this state
to permit the acquisition of control; or
(3)
the acquisition of control would violate the Insurance
Code or another law of this state, another state, or the United States.
(j)
Notwithstanding subsection (h) of this section, a change
in control is considered approved if the department has not proposed to deny
the requested change before the 61st day after the date the department receives
all information required by this section.
(k)
The commissioner is the corporation's or partnership's
agent for service of process in the manner provided by Insurance Code Chapter
804 in a legal proceeding against the corporation or partnership if:
(1)
the corporation or partnership licensed to transact business
in this state fails to appoint or maintain an agent for service in this state;
(2)
an agent for service cannot with reasonable diligence be
found; or
(3)
the license of a corporation or partnership is revoked.
(l)
If a license holder does not maintain the qualifications
necessary to obtain the license, the department shall revoke or suspend the
license or deny the renewal of the license under Insurance Code Article 21.01-2
or 21.07-5.
(m)
Each public insurance adjuster shall maintain all insurance
records, including all records relating to customer complaints received from
customers and the department, separate from the records of any other business
in which the person may be engaged and in the manner specified in Insurance
Code Article 21.07-5.
(n)
The department may license a depository institution or
entity chartered by the federal Farm Credit Administration under the farm
credit system established under 12 U.S.C. Section 2001 et seq., as amended,
to act as a public insurance adjuster in the manner provided for the licensing
of a corporation under this section.
§19.705.Financial Responsibility Requirement.
(a)
Each public insurance adjuster, as a condition for being
licensed, and each trainee as a condition for receiving a temporary training
certificate and as a condition for continuing the license or training certificate
in force, must maintain proof of financial responsibility by obtaining a surety
bond in the principal sum of not less than $10,000 that covers all the required
perils and losses set forth under Insurance Code Article 21.07-5 §6.
(b)
Each public insurance adjuster and trainee must obtain
separate proof of financial responsibility and may not rely on the bond of
any other public insurance adjuster or trainee to demonstrate proof of financial
responsibility.
§19.706.Demonstrating Financial Responsibility.
The public insurance adjuster applicant, licensee, or trainee shall
demonstrate proof of financial responsibility by providing to the department
the original surety bond upon application, renewal, or replacement of the
bond.
§19.707.Type of Financial Responsibility.
A surety bond used to maintain and demonstrate proof of financial responsibility
under §§19.705 and 19.706 of this subchapter (relating to Financial
Responsibility Requirement and Demonstrating Financial Responsibility) must:
(1)
be in the form specified by the department;
(2)
be executed by the public insurance adjuster as principal
and a surety company authorized to do business in this state as surety;
(3)
be payable to the Texas Department of Insurance for the
use and benefit of an insured, conditioned that the public insurance adjuster
shall pay any final judgment recovered against it by an insured;
(4)
provide that the surety will give no less than 30 days
written notice of bond termination to the licensee and the department;
(5)
be separate from any other financial responsibility obligation;
and
(6)
not be used to demonstrate professional responsibility
for any other license, certification, or person.
§19.708.Public Insurance Adjuster Contracts.
(a)
A public insurance adjuster may not, directly or indirectly,
act within this state as a public insurance adjuster without having first
entered into a written contract executed in duplicate by the licensee and
the insured or the insured's duly authorized representative.
(b)
A public insurance adjuster's written contract with an
insured must contain:
(1)
the name, address, and license number of the public insurance
adjuster negotiating the contract and, if applicable, the name, address, and
license number of the public insurance adjuster's employing public insurance
adjuster;
(2)
the public insurance adjuster's telephone and fax number,
including area code;
(3)
the mailing and physical addresses to which notice of cancellation
and all communications to the public insurance adjuster may be delivered;
(4)
if any part of the contract or solicitation is made via
the internet, the e-mail and website address to which notice of contract cancellation
and all communications to the public insurance adjuster may be delivered;
(5)
the date and time the contract was signed;
(6)
for each nonresident public insurance adjuster named in
the contract, the name and address of the nonresident public insurance adjuster's
agent for service of process;
(7)
the following separate statements in 12 point bold faced
type on the signature page of the contract:
(A)
"NOTICE: THE INSURED MAY CANCEL THIS CONTRACT WITHIN 72
HOURS OF SIGNATURE FOR ANY REASON.";
(B)
"WE REPRESENT THE INSURED ONLY." and;
(C)
"YOU ARE ENTERING INTO A SERVICE CONTRACT. YOU ARE BEING
CHARGED A FEE FOR THIS SERVICE. YOU DO NOT HAVE TO ENTER INTO THIS CONTRACT
TO MAKE A CLAIM FOR LOSS OR DAMAGE ON A POLICY OF INSURANCE.";
(8)
the statement: "If the insurance carrier pays or commits
in writing to pay to the insured the policy limits of the insurance policy
in accordance with Insurance Code Article 6.13 or §862.053 within 72
hours of the loss being reported to the insurer, the public insurance adjuster
is not entitled to compensation based on a percentage of the insurance settlement,
but is entitled to reasonable compensation for the public insurance adjuster's
time and expenses provided to the insured before the claim was paid or the
written commitment to pay was received.";
(9)
the statement: "NOTICE: A public insurance adjuster may
not participate directly or indirectly in the reconstruction, repair, or restoration
of damaged property that is the subject of a claim adjusted by the public
insurance adjuster or engage in any other activities that may reasonably be
construed as presenting a conflict of interest, including soliciting or accepting
any remuneration from, or having a financial interest in, any salvage firm,
repair firm, or other firm that obtains business in connection with any claim
the public insurance adjuster has a contract or agreement to adjust.";
(10)
on the first or second page of the contract, the following
English and Spanish notices in 10 point bold faced type:
(A)
"IMPORTANT NOTICE: You may contact the Texas Department
of Insurance to obtain information on public insurance adjusters, your rights
and complaints at: 1-800-252-3439 or you may write the Texas Department of
Insurance at P. O. Box 149104, Austin, Texas 78714-9104, Fax # (512) 475-1771.";
(B)
"ADVISO IMPORTANTE: Puede comunicarse con el Departamento
de Seguros de Texas para obtener informacion acera ajustores publicos de seguros,
o sus derechos o quejas al: 1-800-252-3439 o puede escribir al Departamento
de Seguros de Texas P. O. Box 149104, Austin, Texas 78714-9104, Fax # (512)
475-1771."; and
(11)
a clear statement of the public insurance adjuster's commission
including:
(A)
the method of calculating compensation for the public insurance
adjuster, either hourly, flat fee, or percentage of settlement; and
(B)
a statement that under any method of compensation the total
commission payable to the public insurance adjuster may not exceed 10% of
the amount of the insurance settlement.
(c)
The contract may not contain any terms or conditions which
have the effect of limiting or nullifying any requirements of the Insurance
Code, this subchapter, or other rules of the department.
§19.709.Nonresident Applicants and License Holders.
(a)
An applicant for a nonresident public insurance adjuster
license or temporary certificate must, through the law enforcement agency
of the applicant's state of residence, submit a copy of the applicant's criminal
history records to the department. The department shall use the criminal history
records to determine eligibility for issuance of a license in accordance with
this subchapter and other laws of this state.
(b)
The annual nonresident affidavit required by Insurance
Code Article 21.07-5 §15(d) shall be made on a form available from the
department and filed one year after the date the license was issued and annually
thereafter.
§19.710.Nonresidents Required to File Biographical Information.
A nonresident who is required to file biographical information under §19.704
of this subchapter (relating to Public Insurance Adjuster Licensing) shall,
through the law enforcement agency of the person's state of residence, submit
a copy of the applicant's criminal history records to the department. The
department shall use the criminal history records to determine eligibility
for issuance of a license in accordance with this subchapter and other laws
of this state.
§19.711.Fingerprint Requirement.
(a)
Any individual who submits to the department a new application
to be licensed or registered under Insurance Code Article 21.07-5 and any
individual from whom biographical information is required under §19.704
of this subchapter (relating to Public Insurance Adjuster Licensing) shall
attach to the application or biographical information a completed, legible
fingerprint card.
(b)
Fingerprints obtained under this section shall be handled
in the manner set forth in §19.1807 of this chapter (relating to Confidentiality
and Custody of Fingerprint Cards).
§19.712.Advertisement.
(a)
As used in Insurance Code Article 21.07-5, "advertisement"
includes:
(1)
printed and published material, audio visual material and
descriptive literature of a public insurance adjuster used in direct mail,
newspapers, magazines, radio, telephone and television scripts, internet web
sites, billboards, and similar displays;
(2)
descriptive literature and promotional aids of all kinds
issued by a public insurance adjuster for presentation to members of the public,
including circulars, leaflets, booklets, depictions, illustrations, and form
letters;
(3)
prepared promotional talks, presentations and materials
for use by a public insurance adjuster, and those representations made on
a recurring basis by a public insurance adjuster to members of the public;
(4)
material used to:
(A)
solicit contracts from insureds; or
(B)
modify existing contracts;
(5)
material included with a contract when the contract is
delivered and materials used in the solicitation of contract renewals, extensions
or reinstatements, except those extensions or reinstatements provided for
in the contract;
(6)
lead card solicitations, defined as communications distributed
to the public which, regardless of form, content, or stated purpose, are intended
to result in the compilation or qualification of a list containing names or
other personal information regarding insureds who have expressed a specific
interest in obtaining assistance with having their claims settled, and which
are intended to be used to solicit residents of this state for the execution
of a contract for a public insurance adjuster's services; and
(7)
any other communication directly or indirectly related
to a public insurance adjuster contract, and intended to result in the eventual
execution of such a contract.
(b)
"Advertisement" does not include:
(1)
communications or materials used within a public insurance
adjuster's own organization, not used as promotional aids and not disseminated
to the public;
(2)
communications with insureds other than materials soliciting
insureds to enter, renew, extend or reinstate a contract for a public insurance
adjuster's services; and
(3)
material used solely for the recruitment, training, and
education of a public insurance adjuster's personnel and subcontractors, provided
it is not also used to induce the public to enter, renew, extend or reinstate
a contract for a public insurance adjuster's services.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed
with the Office of the Secretary of State on August 11, 2003.
TRD-200304979
Gene C. Jarmon
General Counsel and Chief Clerk
Texas Department of Insurance
Earliest possible date of adoption: September 21, 2003
For further information, please call: (512) 463-6327
28 TAC §19.802
These sections are proposed under Insurance Code Articles
21.01, 21.01-1, 21.01-2, and 21.07-5, and §§36.001 and 801.056,
and Government Code §2054.252. Article 21.01 §3 provides that Insurance
Code Chapter 21, Subchapter A applies to the listed licensees and §4
authorizes the commissioner to adopt rules to implement the subchapter. Article
21.01-1 §1 authorizes the commissioner to require applicants to take
examinations through a department-designated vendor. Article 21.01-1 §3
authorizes the commissioner to develop a continuing education program for
licensees. Article 21.01-2 §3A authorizes the commissioner to refuse,
deny, revoke or suspend a license or license application. Article 21.07-5 §29
authorizes the department to adopt rules necessary to implement Article 21.07-5
and define the term advertisement. Insurance Code §801.056 authorizes
the commissioner to require applicants to submit a complete set of fingerprints
prior to licensure. Government Code §2054.252 (g) requires the department
to increase licensing fees in an amount sufficient to cover the Texas OnLine
Authority subscription fee cost. Insurance Code §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.
The following statutes are affected by the proposal: Rule No. Statute Insurance
Code Articles 21.07-5, 21.01, 21.01-1, 21.01-1 and 21.07-5 21.01, 21.01-1,
and 21.07-5 §19.803 Government Code §2054.252
§19.802.Amount of Fees.
(a)
(No change.)
(b)
The amounts of fees are as follows:
(1)-(19)
(No change.)
(20)
Public insurance adjuster:
(A)
original application -- $50;
(B)
renewal -- $50;
(C)
qualifying examination $50.
(21)
Public insurance adjuster temporary training
certificate:
(A)
training certificate -- $50;
(B)
renewal -- $50.
(c)-(e)
(No change.)
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed
with the Office of the Secretary of State on August 11, 2003.
TRD-200304980
Gene C. Jarmon
General Counsel and Chief Clerk
Texas Department of Insurance
Earliest possible date of adoption: September 21, 2003
For further information, please call: (512) 463-6327
(b)
Public adjusters are not subject to licensing
under the Act, as they do not regularly investigate, adjust, or supervise
losses on behalf of an insurer or a self-insured.
]
(c)
] Marine surveyors, as usually
and customarily defined, are not subject to licensing under the Act, unless
they regularly investigate, adjust, or supervise losses on behalf of an insurer
or self-insured.
(d)
] The
department
[
State Board of Insurance
] recognizes that certain risks are commonly
referred to as "self-insured" or "self-handlers" in reference to insurance
claims and losses. For the purposes of administration of the Act and in reference
to those entities operating as such, the
department
[
State
Board of Insurance
] interprets that any individual specifically employed
for the purpose of supervision, investigation, or adjusting of losses is subject
to the provisions of the Act, and the individual or individuals who have the
primary responsibility for the supervision, investigation, or adjustment of
losses is subject to the provisions of the Act.
Subchapter H. LICENSING OF PUBLIC INSURANCE ADJUSTERS
Subchapter I. LICENSING FEES
Subchapter K CONTINUING EDUCATION AND ADJUSTER PRELICENSING EDUCATION PROGRAMS