On behalf of all Texas Roofing Contractors, RCAT fights to defend your business from harmful legislation and to develop public policy solutions designed to safeguard and advance your business interests.
THE 86th TEXAS LEGISLATIVE SESSION HAS COME TO A CLOSE! TWO VERY IMPORTANT PIECES OF LEGISLATION WILL BECOME LAW ON SEPTEMBER 1, 2019:
HB2102 - Prohibition Against Waiving of Deductibles (available here) -- The waiving of deductibles has been improper in Texas since 1989. Unfortunately, due to a 1990 opinion by the Attorney General, many contractors ignored the prohibition and the waiving of deductibles has become common in Texas. Reputable contractors who refused to break the law could not compete with the “deductible eaters”. Homeowners were lured to sign contracts with shady contractors with promises of “A Free Roof!” And homeowners were duped into committing insurance fraud when they failed to advise the insurance company in submitting a request for replacement cost holdback that the deductible portion of the claim had not been incurred. HB2102 fixes all of these problems by making it crystal clear that deductibles must be paid. A contractor commits a violation of the new law if it pays, waives, absorbs, rebates, credits, or otherwise declines to charge or collect a deductible. Contracts must also contain a disclosure statement that insurance deductibles must be paid. An insurance company can request “reasonable proof” that the deductible has been paid before making a replacement cost holdback payment. This important legislation will both protect Texas consumers from illegal fraud schemes and ensure that reputable contractors who collect deductibles are on a level playing field in competing for business.
The legislation goes into effect September 1, 2019, so make sure you understand what is required, including new mandatory contract language, in a minimum 12-point bold font that says:
“Texas law requires a person insured under a property insurance policy to pay any deductible applicable to a claim made under the policy. It is a violation of Texas law for a seller of goods or services who reasonably expects to be paid wholly or partly from the proceeds of a property insurance claim to knowingly allow the insured person to fail to pay, or assist the insured person ’s failure to pay, the applicable insurance deductible.”
HB2103 – Prohibition Against UPPA (available here) -- Section 4102.163 of the Texas Insurance Code enacted in 2005 and edited in 2013 to prohibit the "unauthorized practice of public adjusting" (UPPA) by singling out roofing contractors only! That wrong has been righted in HB2103 which simply deletes the word “roofing” from the existing statute to broaden the scope of the UPPA prohibition to all contractors.