2005 Texas Insurance Code CHAPTER 558. REFUND OF UNEARNED PREMIUM

INSURANCE CODE

CHAPTER 558. REFUND OF UNEARNED PREMIUM


	§ 558.001. DEFINITION.  In this chapter, "insurer" means 
an insurance company or other entity authorized to engage in the 
business of insurance in this state.  The term includes:
		(1)  a stock life, health, or accident insurance 
company;                   
		(2)  a mutual life, health, or accident insurance 
company;                  
		(3)  a stock fire or casualty insurance company;                              
		(4)  a mutual fire or casualty insurance company;                             
		(5)  a Mexican casualty insurance company;                                    
		(6)  a farm mutual insurance company;                                         
		(7)  a county mutual insurance company;                                       
		(8)  a Lloyd's plan;                                                          
		(9)  a reciprocal or insurance exchange;                                      
		(10)  a fraternal benefit society;                                            
		(11)  a stipulated premium company;                                           
		(12)  a nonprofit legal services corporation;                                 
		(13)  a statewide mutual assessment company;                                  
		(14)  a local mutual aid association;                                         
		(15)  a local mutual burial association;                                      
		(16)  an association exempt under Section 887.102;                            
		(17)  a nonprofit hospital, medical, or dental service 
corporation, including a corporation subject to Chapter 842;
		(18)  a risk retention group;                                                 
		(19)  a purchasing group;                                                     
		(20)  an eligible surplus lines insurer;  and                                 
		(21)  a guaranty association operating under Article 
21.28-C or 21.28-D.    

Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.          


	§ 558.002. APPLICABILITY OF CHAPTER;  REFUND OF UNEARNED 
PREMIUM.  (a) This chapter applies to an insurer that issues an 
insurance policy that requires the insurer to maintain an unearned 
premium reserve for the portion of the written policy premium 
applicable to the unexpired or unused part of the policy period for 
which the premium has been paid.
	(b)  An insurer shall promptly refund the appropriate 
portion of any unearned premium to the policyholder if the policy:
		(1)  has a remaining unearned premium reserve;  and                           
		(2)  is canceled or terminated by the insured or the 
insurer before the end of its term.
	(c)  A guaranty association shall promptly refund any 
unearned premium as described by Section 5(8), Article 21.28-C, or 
Sections 5(10) and 8(n), Article 21.28-D.

Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.          


	§ 558.003. RULES AND GUIDELINES.  The commissioner shall:                   
		(1)  adopt rules necessary to implement this chapter;  
and                  
		(2)  establish appropriate guidelines to determine the 
portion of an unearned premium that must be refunded to a 
policyholder under this chapter.

Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.          


	§ 558.004. EFFECT ON INSURANCE PREMIUM FINANCE 
COMPANY.  This chapter does not affect the obligation of an insurer 
to pay an unearned premium to an insurance premium finance company 
in accordance with Section 651.162.

Added by Acts 2003, 78th Leg., ch. 1274, § 2, eff. April 1, 2005.