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No significant fiscal implication to the State is anticipated.
HB 1897 would make procedural changes to dispute resolutions for individuals filing claims against FAIR. The bill outlines new requirements that include deadlines for filing claims, notice for new procedures for disputed claims, and limitations for the recovery of related disputes. According to the author, the changes in this bill are an attempt to end frivolous lawsuits and remove the financial burden that is being pushed down to consumer premiums by limiting the scope of filing deadlines for the recovery from related lawsuits.
Guidelines for the claim filing process include the following: claims must be filed within a year of the loss, FAIR would be required to respond to the claim within a certain period of time, and FAIR would be required to pay the claim within 10 days if coverage was approved. In addition to these new requirements, a claimant would also be allowed to split the cost of an appraisal, if approved.
HB 1897 would direct the Texas Department of Insurance (TDI) to select an appraisal mediator for processing related claims. If a claimant found intent to bring an action, the bill would require FAIR to go through a mediation process before actually filing a suit. Furthermore, the bill would prohibit actions that relates to statues in the Unfair Claim and Settlement Practices Act. (This act relates to a protection of the consumer against unjust behaviors from insurers). The bill states that HB 1897 would prevail over any other law.
Finally, the bill would establish an ombudsman program for
the purpose of providing educational matieral for individuals who are covered under FAIR.
Texas Action remains neutral on HB 1897 as it doesn't affect any of our liberty principles.