Funding of excess losses and operating expenses of the Texas Windstorm Insurance Association; authorizing an assessment; authorizing a surcharge.

The bill amends the Insurance Code to change the funding mechanism for the Texas Windstorm Insurance Association. It allows the association to enter into financing arrangements with the state to provide up to $500 million before a catastrophic event and up to $1 billion after a catastrophic event. The proceeds of these financing arrangements must be secured and repaid by catastrophe surcharges. The bill also authorizes the commissioner to set a catastrophe surcharge on certain insurance policies. The surcharge is not refundable if the policy is canceled or terminated.

Funding of excess losses and operating expenses of the Texas Windstorm Insurance Association; authorizing an assessment; authorizing a surcharge.

The bill amends the Insurance Code to change the funding mechanism for the Texas Windstorm Insurance Association. It allows the association to enter into financing arrangements with the state to provide up to $500 million before a catastrophic event and up to $1 billion after a catastrophic event. The proceeds of these financing arrangements must be secured and repaid by catastrophe surcharges. The bill also authorizes the commissioner to set a catastrophe surcharge on certain insurance policies. The surcharge is not refundable if the policy is canceled or terminated.