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Statutes > Texas > Insurance-code > Title-10-property-and-casualty-insurance > Chapter-2211-fair-plan

INSURANCE CODE

TITLE 10. PROPERTY AND CASUALTY INSURANCE

SUBTITLE G. POOLS, GROUPS, PLANS, AND SELF-INSURANCE

CHAPTER 2211. FAIR PLAN

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 2211.001. DEFINITIONS. In this chapter:

(1) "Association" means the FAIR Plan Association established

under this chapter.

(2) "FAIR Plan" means a Fair Access to Insurance Requirements

Plan established under Section 2211.051.

(3) "Governing committee" means the governing committee of the

association.

(4) "Inspection bureau" means the organization or organizations

designated by the association under Section 2211.153.

(5) "Insurer" means an authorized insurer writing property

insurance in this state, including:

(A) a Lloyd's plan; and

(B) a reciprocal or interinsurance exchange.

(6) "Net direct premiums" means gross direct written premiums

less return premiums on canceled contracts, regardless of

reinsurance assumed or ceded, written on residential property

under this chapter.

(7) "Residential property insurance" means the coverage provided

by a homeowners insurance policy, residential fire and allied

lines insurance policy, or farm and ranch owners insurance policy

against loss incurred to real or tangible personal property at a

fixed location.

(8) "Underserved area" or "underserved areas" means an area or

areas designated as underserved by the commissioner by rule.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.002. IMMUNITY. Liability does not exist on the part

of, and a cause of action does not arise against, an insurer, the

inspection bureau, the association, the governing committee, the

commissioner, an authorized representative of the commissioner,

or an agent or employee of an insurer, the inspection bureau, the

association, or the governing committee for:

(1) an inspection required by this chapter;

(2) an act or omission in connection with an inspection; or

(3) a statement made:

(A) in a report and communication concerning the insurability of

property;

(B) in the determinations required by this subchapter or

Subchapter B, C, D, or F; or

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.003. APPEALS; JUDICIAL REVIEW. (a) An applicant or

affected insurer is entitled to appeal to the association. The

association's decision may be appealed to the commissioner not

later than the 30th day after the date of the decision.

(b) An order or decision made by the commissioner under this

chapter is subject to judicial review in accordance with

Subchapter D, Chapter 36.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

SUBCHAPTER B. ESTABLISHMENT AND ADMINISTRATION OF FAIR PLAN

Sec. 2211.051. ESTABLISHMENT OF FAIR PLAN. The commissioner may

establish a Fair Access to Insurance Requirements Plan to deliver

residential property insurance to residents of this state in

underserved areas if the commissioner determines, after a public

hearing, that:

(1) in all or any part of the state, residential property

insurance is not reasonably available in the voluntary market to

a substantial number of insurable risks; or

(2) at least 25 percent of the applicants to the residential

property market assistance program who are qualified under that

program's plan of operation have not been placed with an insurer

in the preceding six months.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.065(a), eff. September 1, 2007.

Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.065(a), eff. September 1, 2007.

Sec. 2211.052. ADMINISTRATION OF FAIR PLAN; COMPOSITION OF

GOVERNING COMMITTEE. (a) The governing committee shall

administer the FAIR Plan under a plan of operation.

(b) The governing committee is composed of 11 members appointed

by the commissioner as follows:

(1) five members who represent the interests of insurers;

(2) four public members who reside in this state; and

(3) two members who are general property and casualty agents.

by the commissioner serves as an ex officio member.

(d) Each member of the governing committee who represents the

interests of insurers must be a full-time employee of an insurer

that is a member of the association.

(e) The commissioner may remove a member of the governing

committee without cause and may replace the member in accordance

with Subsection (b).

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.065(b), eff. September 1, 2007.

Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.065(b), eff. September 1, 2007.

Sec. 2211.0521. MEETINGS OF GOVERNING BODY. (a)

Notwithstanding Chapter 551, Government Code, or any other law,

members of the governing committee may meet by telephone

conference call, video conference, or other similar

telecommunication method. The governing committee may use

telephone conference call, video conference, or other similar

telecommunication method for purposes of establishing a quorum or

voting or for any other meeting purpose in accordance with this

subsection and Subsection (b). This subsection applies without

regard to the subject matter discussed or considered by the

members of the governing committee at the meeting.

(b) A meeting held by telephone conference call, video

conference, or other similar telecommunication method:

(1) is subject to the notice requirements applicable to other

meetings of the governing committee;

(2) may not be held unless notice of the meeting specifies the

location of the meeting at which at least one member of the

governing committee is physically present;

(3) must be audible to the public at the location specified in

the notice under Subdivision (2); and

(4) must provide two-way audio communication between all members

of the governing committee attending the meeting during the

entire meeting, and if the two-way audio communication link with

members attending the meeting is disrupted so that a quorum of

the governing committee is no longer participating in the

meeting, the meeting may not continue until the two-way audio

communication link is reestablished.

Added by Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.065(c), eff. September 1, 2007.

Added by Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.065(c), eff. September 1, 2007.

Sec. 2211.053. AMENDMENTS TO PLAN OF OPERATION. (a) The

governing committee may, on the committee's own initiative or at

the commissioner's request, propose amendments to the plan of

operation.

(b) Amendments to the plan must be adopted by the commissioner

by rule.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.054. CONTENTS OF PLAN OF OPERATION. The plan of

operation must:

(1) provide for a nonprofit association to issue residential

property insurance under this chapter and distribute the losses

and expenses in writing that insurance in this state;

(2) provide that all insurers that write residential property

insurance shall participate in the association in accordance with

Sections 2211.101(b) and (c);

(3) provide that a participating insurer is entitled to receive

credit in accordance with Section 2211.101(d);

(4) provide for the immediate binding of eligible risks;

(5) provide for the use of premium installment payment plans,

adequate marketing, and service facilities;

(6) provide for the establishment of reasonable service

standards;

(7) provide procedures for efficient, economical, fair, and

nondiscriminatory administration of the association;

(8) provide procedures for determining the net level of

participation required for each insurer in the association;

(9) provide for the use of deductibles and other underwriting

devices;

(10) provide for assessment of all members in amounts sufficient

to operate the association;

(11) establish maximum limits of liability to be placed through

the program;

(12) establish commissions to be paid to the insurance agents

submitting applications;

(13) provide that the association issue policies in the

association's own name;

(14) provide reasonable underwriting standards for determining

insurability of a risk;

(15) provide procedures for the association to assume and cede

reinsurance; and

(16) provide any other procedure or operational matter the

governing committee or the commissioner considers necessary.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.055. ASSOCIATION DUTIES WITH RESPECT TO POLICIES. (a)

The association may, for FAIR Plan purposes only:

(1) issue insurance policies and endorsements to those policies

in the association's own name or a trade name adopted for that

purpose; and

(2) act on behalf of all participating insurers in connection

with those policies and act in any other manner necessary to

accomplish the purposes of this chapter, including:

(A) issuing insurance policies;

(B) collecting premiums;

(D) paying commissions, losses, judgments, and expenses.

(b) In connection with an insurance policy issued by the

association:

(1) service of a notice, proof of loss, legal process, or other

communication with regard to the policy must be made on the

association; and

(2) an action by the insured constituting a claim under the

policy may be brought only against the association, and the

association is the proper party for all purposes in an action

brought under or in connection with the policy.

insurance policy issued by the association.

(d) The form and content of an insurance policy issued by the

association are subject to the commissioner's approval.

(e) The association may assume and cede reinsurance as provided

by the plan of operation.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.056. FILING AND APPROVAL OF RATES. (a) The

association shall file with the commissioner for approval the

proposed rates and supplemental rate information to be used in

connection with the issuance of insurance policies or

endorsements.

(b) The association shall set rates in an amount sufficient to:

(1) carry all claims to maturity; and

(2) meet the expenses incurred in the writing and servicing of

the business.

files the proposed rates, the commissioner shall enter an order

approving or disapproving, wholly or partly, the proposed rates.

The commissioner may, on notice to the association, extend the

period for entering an order under this section an additional 30

days.

(d) An order disapproving a rate must state:

(1) the grounds for the disapproval; and

(2) the findings in support of the disapproval.

(e) The association may not issue an insurance policy or

endorsement until the commissioner approves the rates to be

applied to the policy or endorsement.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.057. POWERS OF COMMISSIONER. The commissioner is

charged with the authority to supervise the association and the

inspection bureau. The commissioner also has the power to:

(1) examine the operation of the association and the inspection

bureau through free access to all the books, records, files,

papers, and documents relating to the operation of the

association and the inspection bureau;

(2) summon, qualify, and examine as a witness any person who has

knowledge of the operation of the association or the inspection

bureau, including a member of the governing committee or an

officer or employee of the association or the inspection bureau;

(3) take any action necessary to enable this state and the

association to fully participate in any federal reinsurance

program that is enacted for purposes similar to the purposes of

this chapter;

(4) require reports from the association concerning risks the

association insures under this chapter as the commissioner

considers necessary; and

(5) adopt policy forms and endorsements, promulgate rates, and

adopt rating and rule manuals for use by the association.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.058. ANNUAL OPERATING REPORT. (a) Not later than

March 31 of each year, the association shall compile and submit

to the commissioner an operating report covering the preceding

calendar year.

(b) The report is a public record.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.059. ASSETS OF ASSOCIATION. On dissolution of the

association, all assets of the association shall be deposited in

the general revenue fund.

Added by Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.067(a), eff. September 1, 2007.

Added by Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.067(a), eff. September 1, 2007.

SUBCHAPTER C. INSURER PARTICIPATION IN FAIR PLAN

Sec. 2211.101. COVERAGE PROVIDED TO INSUREDS IN UNDERSERVED

AREA. (a) In accordance with the plan of operation, the

association shall develop and administer a program for

participation by each insurer that writes residential property

insurance in this state.

(b) Except as provided by this subsection, each insurer, as a

condition of the insurer's authority to engage in the business of

residential property insurance in this state, shall participate

in the association in accordance with this chapter, including

participating in the association's assessments in the proportion

that the insurer's net direct premiums written in this state

during the preceding calendar year bear to the aggregate net

direct premiums written in this state by all participating

insurers. The Texas Windstorm Insurance Association established

by Chapter 2210 may not participate in the association for any

purpose.

association's assessments must be determined in accordance with

the residential property statistical plan adopted by the

commissioner.

(d) A participating insurer is entitled to receive credit for

similar insurance voluntarily written in an underserved area.

The participation of an insurer entitled to receive credit under

this subsection must be reduced in accordance with the plan of

operation.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.065(d), eff. September 1, 2007.

Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.065(d), eff. September 1, 2007.

Sec. 2211.102. LIABILITY OF INSURERS TO ASSOCIATION;

ASSESSMENTS. The participating insurers are liable to the

association as provided by this chapter and the plan of operation

for the expenses and liabilities incurred by the association as

provided by this chapter and the plan. The association shall

make assessments against the participating insurers as required

to meet those expenses and liabilities.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.103. RECOMPUTATION OF REIMBURSEMENT RATIOS. If a

participating insurer fails to pay an assessment because of the

insurer's insolvency, the association shall immediately recompute

the reimbursement ratios to exclude from the ratios the amount of

that assessment the commissioner determines is uncollectible, so

that the uncollectible amount is assumed by and redistributed

among the remaining participating insurers.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.104. ADDITIONAL ASSESSMENT IN EVENT OF DEFICIT;

PREMIUM SURCHARGE AUTHORIZED. (a) If the association incurs a

deficit, the association, at the commissioner's direction, shall:

(1) request the issuance of public securities as authorized by

Subchapter E; or

(2) assess participating insurers in accordance with this

section.

(b) As reimbursement for assessments paid under this section or

service fees paid under Section 2211.209, each insurer may charge

a premium surcharge on every property insurance policy insuring

property in this state that the insurer issues, the effective

date of which is within the three-year period beginning on the

90th day after the date of the assessment or the 90th day after

the date the service fee under Section 2211.209 is paid, as

applicable.

Subsection (b) as a uniform percentage of the premium on each

policy described by Subsection (b). The percentage must be equal

to one-third of the ratio of the amount of the participating

insurer's assessment or service fee payment to the amount of the

insurer's direct earned premiums, as reported to the department

in the insurer's financial statement for the calendar year

preceding the year in which the assessment or service fee payment

is made so that, over the three-year period, the aggregate of all

surcharges by the insurer under this section is at least equal to

the amount of the assessment or service fee payment.

(d) The amount of any assessment paid and surcharged under this

section may be carried by the insurer as an admitted asset of the

insurer for all purposes, including exhibition in annual

statements under Section 862.001, until collected.

(e) The commissioner shall adopt rules and procedures as

necessary to implement this section.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.066(a), eff. September 1, 2007.

Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.066(a), eff. September 1, 2007.

Sec. 2211.105. RETENTION AND USE OF PROFITS BY ASSOCIATION. (a)

The association shall retain any profits of the association to

be used for the purposes of the association.

(b) The association:

(1) shall use the profits to mitigate losses, including

purchasing reinsurance and offsetting future assessments; and

(2) may not distribute the profits to insurers.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

SUBCHAPTER D. COVERAGE PROVIDED TO INSUREDS

Sec. 2211.151. MANDATORY COVERAGE PROVIDED TO CERTAIN INSUREDS.

The association shall make residential property insurance

available to each applicant in an underserved area whose property

is insurable in accordance with reasonable underwriting standards

but who, after diligent efforts, is unable to obtain residential

property insurance through the voluntary market, as evidenced by

two declinations from insurers authorized to engage in the

business of, and writing, residential property insurance in this

state.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.152. DESIGNATION OF AREA AS UNDERSERVED. The

commissioner by rule shall designate the areas determined to be

underserved. In determining which areas to designate as

underserved, the commissioner shall consider the factors

specified in Section 2004.002.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.153. INSPECTION BUREAU. The association, with the

approval of the commissioner, shall designate one or more

organizations as the inspection bureau. The inspection bureau

shall:

(1) make inspections to determine the condition of a property

for which residential property insurance is sought; and

(2) perform other duties authorized by the association or the

commissioner.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.154. PROPERTY INSPECTION. (a) A person who has an

insurable interest in real or tangible personal property at a

fixed location in an underserved area and who, after diligent

effort, is unable to obtain residential property insurance, as

evidenced by two current declinations from insurers authorized to

engage in the business of residential property insurance in this

state and actually writing residential property insurance in this

state, is entitled on application to the association to an

inspection and evaluation of the property by representatives of

the inspection bureau.

(b) A general property and casualty agent or personal lines

property and casualty agent may make an application on behalf of

the applicant. The applicant or agent must submit the

application on a form prescribed by the association.

bureau shall make an inspection and file an inspection report

with the association. The inspection report must be made

available to the applicant on request. The association shall

prescribe the manner and scope of the inspection and inspection

report for residential property in accordance with the plan of

operation.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

548, Sec. 2.17, eff. September 1, 2007.

Sec. 2211.155. INSPECTION RESULTS; REINSPECTION. (a) If, after

an inspection, the inspection bureau determines that residential

property meets the underwriting standards established in the plan

of operation, the applicant must be informed in writing of that

determination and the association shall issue a policy or binder.

If the residential property does not meet the underwriting

standards, the applicant must be informed in writing of the

reason for the failure of the residential property to meet the

standards.

(b) If, at any time, an applicant whose residential property did

not meet the underwriting standards makes improvements to the

property or the property's condition that the applicant believes

are sufficient to make the property meet the standards, an

inspection bureau representative shall reinspect the property on

request. In any case, the applicant is eligible for one

reinspection on or before the 60th day after the date of the

initial inspection.

underwriting standards, the applicant must be informed in writing

of that fact and the association shall issue a policy or binder.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.156. CERTAIN COVERAGE EXCLUDED. The FAIR Plan may not

provide windstorm and hail insurance coverage for a risk eligible

for that coverage under Chapter 2210.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.157. COVERAGE FOR CERTAIN WINDSTORM AND HAIL DAMAGE;

COVERAGE FOR CERTAIN PROPERTY LOCATED OVER WATER. (a) A policy

issued by the association may include coverage against loss or

damage by windstorm or hail for:

(1) a building or other structure that is built wholly or

partially over water; and

(2) the corporeal movable property contained in a building or

structure described by Subdivision (1).

(b) The association may impose appropriate limits of coverage

and deductibles for coverage described by Subsection (a).

proposed changes to the plan of operation necessary to implement

Subsections (a) and (b) to the commissioner for the approval of

the commissioner in the manner provided by Section 2211.053.

(d) The commissioner shall adopt rules as necessary to implement

this section, including any rules necessary to implement changes

in the plan of operation proposed under Subsections (a) and (b).

Added by Acts 2007, 80th Leg., R.S., Ch.

730, Sec. 3B.068(a), eff. September 1, 2007.

Added by Acts 2007, 80th Leg., R.S., Ch.

921, Sec. 9.068(a), eff. September 1, 2007.

SUBCHAPTER E. REVENUE BOND PROGRAM

Sec. 2211.201. PURPOSE. The legislature finds that issuing

public securities to provide a method to raise funds to provide

residential property insurance in this state through the

association is to benefit the public and to further a public

purpose.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.202. DEFINITIONS. In this subchapter:

(1) "Board" means the board of directors of the Texas Public

Finance Authority.

(2) "Bond" means a debt instrument or other public security

issued by the Texas Public Finance Authority.

(3) "Public security resolution" means the resolution or order

authorizing public securities to be issued under this subchapter.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.203. APPLICABILITY OF OTHER LAWS. The following laws

apply to public securities issued under this subchapter to the

extent consistent with this subchapter:

(1) Chapters 1201, 1202, 1204, 1205, 1231, 1232, and 1371,

Government Code; and

(2) Subchapter A, Chapter 1206, Government Code.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.204. ISSUANCE OF PUBLIC SECURITIES AUTHORIZED. At the

request of the association and subject to Section 2211.205, the

Texas Public Finance Authority shall issue public securities to:

(1) fund the association, including to:

(A) establish and maintain reserves to pay claims;

(B) pay operating expenses; and

(2) pay costs related to issuing the public securities; and

(3) pay other costs related to the public securities as

determined by the board.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.205. LIMITATION ON AMOUNT OF PUBLIC SECURITIES. The

Texas Public Finance Authority may issue on behalf of the

association public securities in a total amount not to exceed $75

million.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.206. TERMS OF ISSUANCE. (a) Public securities issued

under this subchapter may be issued at a public or private sale.

(b) Public securities must:

(1) be issued in the name of the association; and

(2) mature not more than 10 years after the date issued.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.207. CONTENTS OF PUBLIC SECURITY RESOLUTION;

ADMINISTRATION OF ACCOUNTS. (a) In a public security

resolution, the board may:

(1) provide for the flow of funds and the establishment,

maintenance, and investment of funds and special accounts with

regard to the public securities, including an interest and

sinking fund account, a reserve account, and other accounts; and

(2) make additional covenants with regard to the public

securities and the designated income and receipts of the

association pledged to the payment of the public securities.

(b) The association shall administer the accounts in accordance

with this chapter.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.208. SOURCE OF PAYMENT. (a) Public securities issued

under this subchapter are payable only from:

(1) the service fee established under Section 2211.209; or

(2) other amounts the association is authorized to levy, charge,

and collect.

(b) The public securities are obligations solely of the

association and do not create a pledge, gift, or loan of the

faith, credit, or taxing authority of this state.

(1) include a statement that the state is not obligated to pay

any amount on the security and that the faith, credit, and taxing

authority of this state are not pledged, given, or loaned to

those payments; and

(2) state on the security's face that the security:

(A) is payable solely from the revenue pledged for that purpose;

and

(B) is not a legal or moral obligation of the state.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.209. SERVICE FEE. (a) A service fee may be assessed

against:

(1) each participating insurer; and

(2) the association.

(b) The commissioner shall set the service fee in an amount

sufficient to pay all debt service on the public securities

issued under this subchapter. Each participating insurer and the

association shall pay the service fee as required by the

commissioner by rule.

department shall reimburse the comptroller in the manner

described by Section 201.052.

(d) The commissioner, in consultation with the comptroller, may

coordinate payment and collection of the service fee with other

payments made by participating insurers and collected by the

comptroller.

(e) As a condition of engaging in the business of insurance in

this state, a participating insurer agrees that, if the insurer

leaves the property insurance market in this state, the insurer

remains obligated to pay the insurer's share of the service fee

assessed under this section until the public securities are

retired. The amount assessed against an insurer under this

subsection must be:

(1) proportionate to the insurer's share of the property

insurance market, including residential property insurance, in

this state as of the last complete reporting period before the

date the insurer ceases to engage in the property insurance

business in this state; and

(2) based on the insurer's gross premiums for property

insurance, including residential property insurance, for the

insurer's last reporting period.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.210. EXEMPTION FROM TAXATION. Public securities

issued under this subchapter, any interest from the public

securities, and all assets pledged to secure the payment of the

public securities are exempt from taxation by the state or a

political subdivision of this state.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.211. AUTHORIZED INVESTMENTS. Public securities issued

under this subchapter are authorized investments under Subchapter

B, Chapter 424, and Subchapters C and D, Chapter 425.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.212. STATE PLEDGE REGARDING PUBLIC SECURITY OWNER

RIGHTS AND REMEDIES. (a) The state pledges to and agrees with

the owners of public securities issued in accordance with this

subchapter that the state will not limit or alter the rights

vested in the association to fulfill the terms of agreements made

with the owners or impair the rights and remedies of the owners

until the following obligations are fully discharged:

(1) the public securities;

(2) any bond premium;

(3) interest; and

(4) all costs and expenses related to an action or proceeding by

or on behalf of the owners.

(b) The association may include the state's pledge and agreement

under Subsection (a) in an agreement with the owners of the

public securities.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.213. PAYMENT ENFORCEABLE BY MANDAMUS. A writ of

mandamus and any other legal or equitable remedy are available to

a party in interest to require the association or another party

to fulfill an agreement or perform a function or duty under:

(1) this subchapter;

(2) the Texas Constitution; or

(3) a public security resolution.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

SUBCHAPTER F. PENALTIES

Sec. 2211.251. SANCTIONS AND ADMINISTRATIVE PENALTIES. If the

association, the inspection bureau, or a participating insurer is

found to be in violation of or to have failed to comply with this

chapter, that entity is subject to:

(1) the sanctions authorized by Chapter 82; and

(2) administrative penalties authorized by Chapter 84.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.

Sec. 2211.252. ADDITIONAL DISCIPLINARY PROCEDURES. In addition

to the remedies provided by Section 2211.251, the commissioner

may use any other disciplinary procedures authorized by this

code, including the cease and desist procedures authorized by

Chapter 83.

Added by Acts 2005, 79th Leg., Ch.

727, Sec. 2, eff. April 1, 2007.