Commissioner’s Bulletin # B-0013-98

ATTENTION: State Filings Department

The Texas Department of Insurance has revised the second edition of the "Property and Casualty Filings Made Easy" Manual to incorporate changes in filing requirements resulting from recent legislation. Senate Bill 1499 enacted by the 75 ^th Texas Legislature amended Article 5.13-2, Texas Insurance Code, to include farm and ranch owners and farm and ranch insurance as commercial property for the regulation of rates and policy forms. This change requires amendments to the current edition of the filing manual used by insurers in the preparation and submission of property and casualty form, rate and rule filings. In addition to these changes, some requirements have been revised to clarify and streamline the filing process.

Companies may access and print the third edition of the manual from the Texas Department of Insurance web site as follows:

1. www.tdi.state.tx.us.
2. Find "Quick Access to:" and click on the "Company" link.
3. Scroll to "Property and Casualty" and click on the "Filings Made Easy" link.
4. Scroll to "Download the Filings Made Easy Manual" link. (pcfilman.zip) Once downloaded and unzipped, the file will expand with a complete list of files. The files are numbered for construction purposes.

An "on-line viewing" manual is also available by following the instructions outlined above.

If you don't have access to the Internet, you may request a copy of the manual from the Texas Department of Insurance, Publications Distribution MC 9999, P. O. Box 149104, Austin, Texas 78714 or by phone at 512-322-4283.

Please note the following significant changes in the manual:

INTRODUCTION

• Page INTRO-4 and INTRO-5 - Governing Statutes is amended to reflect that farm and ranch and farm and ranchowners insurance is now governed under Article 5.13-2, Texas Insurance Code.
• Page INTRO-4 and INTRO-5 - Governing Statutes is amended to include GAP insurance. (GAP insurance provides coverage to a lender or a borrower and lender for the difference between actual cash value and the amount of the loan balance in the event of a total loss or theft of a vehicle.)
• Page INTRO-6 - The Summary of Statutory Requirements is amended for farm and ranch insurance and also amended to include requirements for GAP insurance.

FILING TRANSMITTAL

• Page FT-4 - The requirement to submit a signed and notarized affidavit with all filings is replaced by a requirement to submit a certification signed by an officer or designee of the filing company.
• Page FT-5 - FT-7 - A listing of "Frequently Asked Questions" and "Do´s and Don'ts" is included.

SECTION I - FORM AND RULE FILINGS

• For all lines of insurance subject to Article 5.13-2, notations indicating such lines were subject to Subchapter M. Filing Requirements 28 TAC §5.9302 (Equivalent Coverage Rule) are deleted.
• Disclosure form requirements for all lines subject to Article 5.13-2 are deleted.
• Pages FORMS-6, FORMS-7, FORMS-8, and FORMS-9 now include reference to GAP insurance.
• Page FORMS-24 - Regulatory requirement 28 TAC §5.1501 is added for medical professional liability. Reference to Subchapter B. Health Care Rescue Act 28 TAC §5.1309 is deleted.
• Page FORMS-30 - Reference to farm and ranch and farm and ranchowners insurance is deleted since these coverages are now classified as commercial property and subject to Article 5.13-2.
• Page FORMS-34 - Language regarding the effective date for endorsements and premium rating plan rules has been clarified.

SECTION II - RATE FILINGS

• Page RATES-1 - Lists specific changes that require a rate filing to be submitted to TDI.
• Page RATES-2 - Lists required documentation for a complete Worker´s Compensation filing.
• Pages RATES-7, RATES-8, and RATES-9 - New Optional Discount Exhibits for Homeowners (Exh. B1), Dwelling (Exh. B2), and All Other Flex Filings (Exh. B3) are included. The specific optional discounts for HO & Dwelling filings are now listed on Exhibits B1 and B2 making accurate completion of these more complex exhibits easier for insurers.
• Page RATES-16 - Revised 110% of Industry Median data for 1995 and 1996 now provided.
• Page RATES-31 - Added New Profit Provision Information Exhibit (Exh. L) with instructions which include space for insurers to discuss their Rate-of-Return methodology (Page RATES-32).
• Page RATES-34 - Added New Workers' Compensation Deviation Percentage Exhibit (Exh. WC). Inclusion of this new exhibit clarifies for insurers the process of submitting deviation information to TDI.
• Page RATES-35 - Specific information is provided about the kind of information required in the Filing Memorandum portion of each filing.

SECTION III - TORT REFORM

• This new section is provided for all tort reform information previously sent to companies.

APPENDIX

• 28 TAC §5.1301 - §5.1309 (Health Care Rescue Act) is deleted.
• Page APP-8 - 28 TAC §§1.1001 (Disclosure of Guaranty Fund Nonparticipation) is added.
• Page APP-10 - 28 TAC §5.1201 (Regulation of Excess Liability Insurance) is added.
• Page APP-16 - 28 TAC §5.1501-5.1503 (Procedures for Reconsideration of Rates or Premiums Charged a Physician or Health Care Provider for Medical Professional Liability Insurance ) is added.
• 28 TAC §5.9302 (Filing Requirements) is deleted.

The Texas Department of Insurance continues to be committed to assisting you in the preparation and submission of property and casualty rule, rate and form filings. Staff will make every effort to be responsive to your company´s specific questions and concerns. We encourage your comments and suggestions regarding the filing manual and the filing process. Please direct your comments regarding form and rule filings to:

Any questions or comments regarding rate filings may be directed to:

Sincerely,

Marilyn Hamilton, Manager
Commercial Lines
Property and Casualty Insurance Lines

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