Bill Text: TX HB2403 | 2019-2020 | 86th Legislature | Engrossed
Bill Title: Relating to the regulation of residential service companies and residential service contracts.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Engrossed - Dead) 2019-05-14 - Referred to Business & Commerce [HB2403 Detail]
Download: Texas-2019-HB2403-Engrossed.html
86R30521 GRM-F | ||
By: Goldman | H.B. No. 2403 |
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relating to the regulation of residential service companies and | ||
residential service contracts. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 1303.101(b), Occupations Code, is | ||
amended to read as follows: | ||
(b) Except for the license requirement in Subsection (a), a | ||
person who administers, issues, makes, provides, sells, markets, or | ||
offers to sell a residential service contract is exempt from any | ||
other licensing requirements of this state with respect to the | ||
administration, issuance, making, provision, sale, marketing, or | ||
offering for sale of [ |
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service contract [ |
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SECTION 2. Section 1303.152(a), Occupations Code, is | ||
amended to read as follows: | ||
(a) The amount of the reserve required by Section 1303.151 | ||
is based on the amount of liability remaining under outstanding | ||
residential service contracts written in this state by the | ||
residential service company, as determined by multiplying the total | ||
number of days [ |
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pro rata daily [ |
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SECTION 3. Section 1303.202(b), Occupations Code, is | ||
amended to read as follows: | ||
(b) The report must: | ||
(1) be on a form prescribed by the commission; | ||
(2) be verified by at least two of the residential | ||
service company's principal officers; and | ||
(3) include: | ||
(A) financial statements of the residential | ||
service company, including its balance sheet and receipts and | ||
disbursements for the preceding year, certified as accurate by: | ||
(i) an independent public accountant; or | ||
(ii) at least two of the residential | ||
service company's principal officers[ |
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(B) any material change to the information | ||
submitted under Section 1303.103, except an amendment to a | ||
residential service contract filed with the commission under | ||
Section 1303.251; | ||
(C) if the residential service company maintains | ||
a reserve required by Section 1303.151(a), the number of | ||
residential service contracts entered into during the year, the | ||
number of contract holders as of the end of the year, and the number | ||
of contracts terminating during the year; and | ||
(D) any other information that: | ||
(i) relates to the performance and solvency | ||
of the residential service company; and | ||
(ii) is necessary for the commission to | ||
perform its duties under this chapter. | ||
SECTION 4. Section 1303.253, Occupations Code, is amended | ||
by amending Subsections (c), (e), and (f) and adding Subsection (k) | ||
to read as follows: | ||
(c) A filing made under Subsection (a) by a residential | ||
service company that maintains a reserve required by Section | ||
1303.151(a) may [ |
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date: | ||
(1) the filing is made; or | ||
(2) the commission receives any associated filing fee | ||
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(e) If the commission determines that a filing made under | ||
Subsection (a) is not reasonably related to the amount, term, and | ||
conditions of the contract to which the filing applies [ |
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filing. If the commission disapproves the filing, the commission | ||
shall notify the company of the disapproval and shall specify in | ||
detail the reason for the disapproval. | ||
(f) For a filing made under Subsection (a) by a residential | ||
service company described by Subsection (c) after the residential | ||
service company is licensed, the commission shall have 30 days to | ||
disapprove [ |
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date that the commission receives any associated filing fee, | ||
whichever is later. On the 31st day after that date[ |
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is considered approved [ |
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(k) If a filing is disapproved under Subsection (f), the | ||
commission may order the residential service company to pay a | ||
refund as provided by Section 1101.659. | ||
SECTION 5. Section 1303.302(b), Occupations Code, is | ||
amended to read as follows: | ||
(b) A sales contract must state [ |
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(1) the purchase of a residential service contract is | ||
optional; and | ||
(2) the buyer and seller of a residential property may | ||
negotiate the amount paid toward, the coverage provided by, and the | ||
provider of a [ |
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residential service contract [ |
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SECTION 6. Section 1303.352(a), Occupations Code, is | ||
amended to read as follows: | ||
(a) The commission may discipline a residential service | ||
company under Section 1303.351 if the continued operation of the | ||
company would be hazardous to its contract holders or if the | ||
company: | ||
(1) operates in conflict with its basic organizational | ||
document or in a manner that is contrary to that described in and | ||
reasonably inferred from information submitted under Section | ||
1303.103, unless an amendment to the information has been filed | ||
with and approved by the commission; | ||
(2) issues a residential service contract that does | ||
not comply with Sections 1303.251 and 1303.252; | ||
(3) uses a schedule of charges that does not comply | ||
with Section 1303.253; | ||
(4) is not financially responsible and may be | ||
reasonably expected to be unable to meet the company's obligations | ||
to contract holders; | ||
(5) did not comply with Subchapter D; | ||
(6) advertised or marketed the company's services in a | ||
false, misrepresentative, misleading, deceptive, or unfair manner; | ||
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(7) fails to pay the fee for filing the report under | ||
Section 1303.202; | ||
(8) provides false or misleading information to the | ||
commission on a report required by Subchapter E or on a filing | ||
required by Subchapter F; | ||
(9) fails to provide, within a reasonable time, | ||
information requested by the commission that relates to a formal or | ||
informal complaint to the commission; or | ||
(10) otherwise did not substantially comply with this | ||
chapter or a rule adopted under this chapter. | ||
SECTION 7. Sections 1303.101(c) and 1303.253(d), | ||
Occupations Code, are repealed. | ||
SECTION 8. The changes in law made by this Act apply only to | ||
a residential service contract entered into or renewed on or after | ||
the effective date of this Act. A residential service contract | ||
entered into or renewed before that date is governed by the law as | ||
it existed immediately before the effective date of this Act, and | ||
that law is continued in effect for that purpose. | ||
SECTION 9. This Act takes effect September 1, 2019. |