CHAPTER 4055. SPECIALTY AGENTS
INSURANCE CODE
TITLE 13. REGULATION OF PROFESSIONALS
SUBTITLE B. AGENTS
CHAPTER 4055. SPECIALTY AGENTS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 4055.001. DEFINITION. In this chapter, "specialty license
holder" means a person who holds a license issued under this
chapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.002. APPLICABILITY OF CHAPTER TO CERTAIN AGENTS. (a)
A person who holds a general property and casualty license issued
under Chapter 4051 or a general life, accident, and health
license issued under Chapter 4054 or who holds a substantially
equivalent license under this code, as determined by the
commissioner, is not required to obtain a specialty license.
(b) A person described by Subsection (a) is subject to the other
requirements of this chapter in the solicitation, sale, or
delivery of an insurance product that is subject to this chapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.003. RULES. The commissioner may adopt rules
necessary to implement this chapter and to meet the minimum
requirements of federal law, including regulations.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.004. APPLICATION. To obtain a specialty license an
applicant must:
(1) submit to the commissioner:
(A) a written application:
(i) signed by the applicant;
(ii) on a form and supplements to the form prescribed by the
commissioner; and
(iii) containing the information prescribed by the commissioner;
(B) a certification by an insurer authorized to engage in
business in this state:
(i) signed and sworn to by an officer of the insurer;
(ii) stating that the insurer is satisfied that the applicant is
trustworthy and competent to act as the insurer's agent for a
limited purpose authorized by this chapter; and
(iii) stating that if the specialty license applied for is
issued by the department the insurer will appoint the applicant
to act as an agent for a kind of insurance that is subject to
this chapter; and
(C) a nonrefundable license fee set by the department in an
amount necessary to administer this chapter; and
(2) comply with the other requirements of this chapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.005. LICENSE ISSUANCE. The commissioner may issue a
specialty license to an applicant who complies with Section
4055.004 and the other requirements of this chapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.006. EXAMINATION AND CONTINUING EDUCATION NOT
REQUIRED. (a) An examination is not required for issuance of a
specialty license.
(b) A person is not required to comply with continuing education
requirements to hold a specialty license.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.007. APPOINTMENT AS AGENT BY INSURER. An insurer that
appoints an agent under this chapter shall:
(1) submit a certification of the appointment signed by an
officer of the insurer; and
(2) affirm that the insurer is satisfied that the specialty
license holder is trustworthy and competent to act as an agent on
behalf of the insurer.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.008. GENERAL POWERS AND DUTIES. (a) A specialty
license holder may act as an agent for the kinds of insurance
that are subject to this chapter for any insurer authorized to
engage in the business of those kinds of insurance in this state.
(b) Except as otherwise provided by this chapter, a specialty
license holder acting under this chapter shall comply with this
title.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.009. CERTAIN REPRESENTATIONS PROHIBITED. A specialty
license holder may not advertise, represent, or otherwise hold
out the license holder or an employee of the license holder as an
agent licensed under another chapter unless the entity or
individual holds the applicable license.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.010. TREATMENT OF CERTAIN PREMIUMS. Notwithstanding
any other provision of this title or any rule adopted by the
commissioner, a specialty license holder is not required to treat
as money received in a fiduciary capacity premiums collected from
a consumer who purchases insurance coverage when completing a
consumer transaction associated with the coverage if:
(1) the insurer represented by the license holder has consented
in writing, signed by an officer of the insurer, that premiums
are not required to be segregated from money received by the
license holder because of the consumer transaction associated
with the insurance coverage; and
(2) the charges for insurance coverage are itemized but not
billed to the consumer separately from the charges for the
associated consumer transaction.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.011. AUTHORITY OF EMPLOYEE OF SPECIALTY LICENSE
HOLDER. An employee of a specialty license holder may act as an
agent with respect to the kinds of insurance the license holder
is authorized to offer under this chapter only if the employee:
(1) is trained under Section 4055.012 to act individually on
behalf of the license holder;
(2) acts on behalf of and under the supervision of the license
holder; and
(3) is not compensated based primarily on the amount of
insurance sold by the employee under this chapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.012. TRAINING REQUIRED TO ACT ON BEHALF OF SPECIALTY
LICENSE HOLDER. (a) A specialty license holder may not allow an
individual to act on the license holder's behalf with respect to
a kind of insurance that the license holder is authorized to
offer unless the individual has completed an approved training
program.
(b) The materials for the training program must be provided to
the specialty license holder by an insurer that writes the kind
of insurance authorized under the specialty license.
(c) An insurer that provides training program materials under
Subsection (b) must submit the training program to the
commissioner for approval before the training program is used.
(d) The training program must meet the following minimum
standards:
(1) each trainee must receive basic instruction about the kinds
of insurance the specialty license holder is authorized to offer
for purchase by prospective consumers;
(2) each trainee must be instructed to inform a prospective
consumer that, except as may be specifically provided by another
law of this state or the United States, the purchase of the kind
of insurance offered is not required to complete the associated
consumer transaction; and
(3) each trainee must be instructed with respect to the
disclosures required to be made to consumers.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.013. ASSIGNMENT AND TRANSFER OF COMPENSATION BY
CERTAIN AGENTS. A person who is licensed as a general life,
accident, and health agent, life insurance agent, general
property and casualty agent, or personal lines property and
casualty agent or who holds a substantially equivalent license
under this code, as determined by the commissioner, and who
enters into a contract with an insurer to act as the insurer's
agent in soliciting or writing policies or certificates of
insurance that are subject to this chapter may assign and
transfer to the agent's employer any commission, fee, or other
compensation to be paid to the agent under the agent's contract
with the insurer only if the sale of the insurance product occurs
within the scope of the agent's employment.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
548, Sec. 2.29, eff. September 1, 2007.
Sec. 4055.014. DISCLOSURES REQUIRED BEFORE ISSUANCE OF
INSURANCE. Except as provided by Section 4055.105, insurance
coverage may not be issued under this chapter unless:
(1) at each location at which sales of the coverage occur,
brochures or other written materials are prominently displayed
and readily available to a prospective consumer that:
(A) summarize, clearly and correctly, the material terms of the
coverage offered to consumers, including the identity of the
insurer;
(B) disclose that the coverage offered by the specialty license
holder may duplicate coverage already provided by a consumer's
personal auto insurance policy, homeowner's insurance policy,
personal liability insurance policy, or another source of
coverage;
(C) state that, except as specifically provided by another law
of this state or the United States, the purchase by the consumer
of the kind of insurance offered is not required to complete the
associated consumer transaction;
(D) describe the process for filing a claim for benefits; and
(E) contain any additional information required by the
commissioner by rule regarding the price, benefits, exclusions,
conditions, or other limitations of the coverage; and
(2) evidence of coverage is provided to each consumer who
purchases the coverage.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.015. VIOLATION BY SPECIALTY LICENSE HOLDER; PENALTIES.
If a specialty license holder violates this title, the
commissioner may:
(1) impose any disciplinary action authorized by Subchapter C,
Chapter 4005; or
(2) after notice and opportunity for hearing, impose other
penalties, including suspending the transaction of insurance at
specific locations where a violation of this title has occurred,
as the commissioner considers necessary or appropriate to
implement the purposes of this title.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
SUBCHAPTER B. RENTAL CAR COMPANY LICENSE
Sec. 4055.051. DEFINITIONS. In this subchapter:
(1) "Rental agreement" means a written agreement that states the
terms and conditions governing the use of a vehicle or vehicle
equipment provided by a rental car company.
(2) "Rental car company" means a person engaged in the business
of providing leased or rented vehicles or vehicle equipment to
the public.
(3) "Renter" means a person who obtains the use of a vehicle or
vehicle equipment from a rental car company under the terms of a
rental agreement.
(4) "Vehicle" means:
(A) a private passenger motor vehicle, including passenger vans
and minivans that are primarily intended for the transport of
persons;
(B) a motor home;
(C) a motorcycle;
(D) a trailer with a gross vehicle weight rating of 10,000
pounds or less; or
(E) a truck with a gross vehicle weight rating of 26,000 pounds
or less and the operation of which does not require a commercial
driver's license.
(5) "Vehicle equipment" means a cartop carrier, tow bar, or tow
dolly specifically designed for use with a vehicle.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.052. ISSUANCE OF LICENSE. Notwithstanding any other
provision of this chapter or this code, the commissioner shall
issue a specialty license to a rental car company, or to the
franchisee of a rental car company, that complies with this
subchapter. The specialty license may be issued only for the
limited purposes specified by this subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.053. AUTHORITY OF RENTAL CAR COMPANY OR FRANCHISEE.
(a) A rental car company or franchisee licensed under this
chapter may act as an agent for an authorized insurer only:
(1) in connection with the rental of vehicles or vehicle
equipment; and
(2) with respect to:
(A) excess liability insurance that provides coverage in excess
of the standard liability limits provided by the rental car
company in the rental agreement to the rental car company or
franchisee and to renters and other authorized drivers of rental
vehicles for liability arising from the negligent operation or
use of the rental vehicle or vehicle equipment;
(B) accident and health insurance that provides coverage to
renters and other rental vehicle occupants for accidental death
or dismemberment and for medical expenses resulting from an
accident involving the vehicle or vehicle equipment that occurs
during the rental period;
(C) personal effects insurance that provides coverage to renters
and other rental vehicle occupants for the loss of or damage to
personal effects or household belongings that occurs during the
rental period; or
(D) any other coverage the commissioner approves as meaningful
and appropriate in connection with the rental of vehicles or
vehicle equipment.
(b) A rental car company or franchisee licensed under this
chapter may not issue insurance under this subchapter in
connection with a rental agreement if the rental period under the
agreement exceeds 30 consecutive days.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
SUBCHAPTER C. CREDIT INSURANCE LICENSE
Sec. 4055.101. GENERAL DEFINITIONS. In this subchapter:
(1) "Credit insurance" includes:
(A) credit life insurance;
(B) credit accident and health insurance;
(C) credit property insurance;
(D) credit involuntary unemployment insurance; and
(E) insurance that covers the difference between the actual cash
value of a motor vehicle used as security for a loan or lease and
the outstanding balance of that loan or lease if loss or damage
renders the vehicle an actual or constructive total loss while
the debt for which the vehicle serves as security exceeds the
actual cash value of the vehicle.
(2) "Credit insurance agent" means a person licensed under this
chapter to sell credit insurance as specifically provided by this
subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.102. DEFINITION OF CREDIT PROPERTY INSURANCE. (a) In
this subchapter, "credit property insurance" means insurance that
covers personal property:
(1) used as security for a personal or consumer loan; or
(2) under an installment sales agreement or through a consumer
credit transaction that is purchased in connection with or in
relation to the personal or consumer loan, installment sale, or
consumer credit transaction.
(b) "Credit property insurance" does not include insurance that:
(1) provides theft, collision, liability, property damage, or
comprehensive insurance coverage on an automobile, motorized
aircraft, motorcycle, truck, truck-tractor, traction engine, or
any other self-propelled vehicle or craft that is designed
primarily for operation in the air, or on highways, roadways,
waterways, or the sea, and the operating equipment of the
self-propelled vehicle or craft; or
(2) is necessary because of liability imposed by law for damages
arising out of the ownership, operation, maintenance, or use of a
vehicle or craft described by Subdivision (1), other than single
interest coverage on any vehicle or craft described by
Subdivision (1) that insures the interest of the creditor in the
same manner as security for a loan.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.103. ISSUANCE OF LICENSE. Notwithstanding any other
provision of this chapter or this code, the commissioner may
issue a specialty license to a retail distributor of goods, an
automobile dealer, a bank, a state or federal savings and loan, a
state or federal credit union, a finance company, a production
credit association, a manufactured home retailer, or a mobile
home retailer that complies with this subchapter. The specialty
license may be issued only for the limited purposes specified by
this subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.104. AUTHORITY OF CREDIT INSURANCE AGENT. A credit
insurance agent appointed by an insurer authorized to engage in
the business of insurance under this code may act as the agent
for the insurer in the sale of any kind of credit insurance in
the business of which the insurer is authorized to engage,
including individual or group credit insurance.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.105. EXEMPTION FROM CERTAIN DISCLOSURE REQUIREMENTS.
A specialty license holder and the license holder's
representative are not required to make the disclosures required
by Section 4055.014 as that section relates to the sale or
delivery of a credit insurance product that is subject to this
subchapter if the license holder or representative complies with
all disclosure requirements prescribed by another provision of
this code or another law of this state or the United States with
regard to the sale or delivery of that product.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
SUBCHAPTER D. TRAVEL INSURANCE LICENSE
Sec. 4055.151. DEFINITIONS. In this subchapter:
(1) "Planned trip" means any journey or travel arranged through
the services of a travel agency.
(2) "Travel agency" means an entity engaged in the business of
selling or arranging transportation or accommodations for the
public.
(3) "Traveler" means an individual who seeks the assistance of a
travel agency in connection with the planning and purchase of a
trip.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.152. ISSUANCE OF LICENSE. Notwithstanding any other
provision of this chapter or this code, the commissioner may
issue a specialty license to a travel agency, the franchisee of a
travel agency, or a public carrier that complies with this
subchapter. The specialty license may be issued only for the
limited purposes specified by this subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.153. AUTHORITY OF TRAVEL AGENCY OR FRANCHISEE. A
travel agency or franchisee licensed under this chapter may act
as an agent for an authorized insurer only:
(1) in connection with the sale or arrangement of transportation
or accommodations for travelers; and
(2) with respect to:
(A) accident and health insurance that provides coverage to a
traveler for accidental death or dismemberment and for medical
expenses resulting from an accident involving the traveler that
occurs during the planned trip;
(B) insurance that provides coverage to a traveler for expenses
incurred as a result of trip cancellation or interruption of a
planned trip;
(C) personal effects insurance that provides coverage to a
traveler for loss of or damage to personal effects during the
planned trip;
(D) life insurance not exceeding $150,000 on any one life
covering risks of travel during a planned trip; or
(E) any other coverage the commissioner approves as meaningful
and appropriate in connection with the transportation or
accommodations arranged through a travel agency.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
SUBCHAPTER E. SELF-SERVICE STORAGE FACILITY LICENSE
Sec. 4055.201. DEFINITIONS. In this subchapter:
(1) "Rental agreement" means a written agreement that states the
terms governing the use of storage space provided by a
self-service storage facility.
(2) "Renter" means a person who obtains the use of storage space
from a self-service storage facility under a rental agreement.
(3) "Self-service storage facility" means a person engaged in
the business of providing leased or rented storage space to the
public.
(4) "Storage space" means a room, unit, locker, or open space
offered for rental to the public for temporary storage of
personal belongings or light commercial goods.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.202. ISSUANCE OF LICENSE. Notwithstanding any other
provision of this chapter or this code, the commissioner may
issue a specialty license to a self-service storage facility or
to the franchisee of a self-service storage facility that
complies with this subchapter. The specialty license may be
issued only for the limited purposes specified by this
subchapter.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Sec. 4055.203. AUTHORITY OF SELF-SERVICE STORAGE FACILITY OR
FRANCHISEE. A self-service storage facility or franchisee
licensed under this chapter may act as an agent for any
authorized insurer only:
(1) in connection with the rental of storage space; and
(2) with respect to:
(A) hazard insurance coverage provided to a renter for loss of
or damage to tangible personal property in storage or in transit
during the rental period; or
(B) any other coverage the commissioner approves as meaningful
and appropriate in connection with the rental of storage space.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
SUBCHAPTER F. PORTABLE ELECTRONIC VENDOR LICENSE
Sec. 4055.251. DEFINITIONS. In this subchapter:
(1) "Customer" means a person who purchases a portable
electronic device or a related service.
(2) "Portable electronic devices" means personal,
self-contained, easily carried by an individual, battery-operated
electronic communication, viewing, listening, recording, gaming,
computing or global positioning devices, including cell or
satellite phones, pagers, personal global positioning satellite
units, portable computers, portable audio listening, video
viewing or recording devices, digital cameras, video camcorders,
portable gaming systems, docking stations, automatic answering
devices, and other similar devices and their accessories.
(3) "Vendor" means a person or entity engaged in the business of
leasing, selling, or providing portable electronic devices or
related services to customers.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
121, Sec. 1, eff. September 1, 2009.
Sec. 4055.252. ISSUANCE OF LICENSE; LICENSE FEE. (a)
Notwithstanding any other provision of this chapter or this code,
the commissioner may issue a specialty license to a vendor who
complies with this subchapter. The specialty license may be
issued only for the limited purposes specified by this
subchapter.
(b) A specialty license issued to a vendor under this subchapter
authorizes the vendor and any employee or authorized
representative of the vendor to offer the type of coverage
specified in this subchapter at each location at which the vendor
engages in business.
(c) The commissioner shall impose an annual license fee for a
specialty license issued under this subchapter. The commissioner
shall set the license fee in an amount reasonable and necessary
to cover the costs of administering this subchapter, not to
exceed $5,000.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
121, Sec. 1, eff. September 1, 2009.
Sec. 4055.253. AUTHORITY OF VENDOR OF PORTABLE ELECTRONIC
DEVICES. A vendor licensed under this subchapter and the
vendor's employee and authorized representative may act as an
agent for an authorized insurer in connection with the sale and
use of portable electronic devices and related services only
with respect to:
(1) insurance coverage provided to customers that covers
portable electronic devices against one or more of the following:
(A) loss;
(B) theft;
(C) mechanical failure;
(D) malfunction;
(E) damage; or
(F) other applicable perils; or
(2) the provision of any other coverage the commissioner
approves as meaningful and appropriate in connection with the use
of portable electronic devices or related services.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 7, eff. April 1,
2005.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
121, Sec. 1, eff. September 1, 2009.
Sec. 4055.254. INSURANCE POLICY; REQUIREMENTS. (a) Insurance
provided under this subchapter may be issued to a licensed vendor
under a master or group policy of personal or commercial inland
marine insurance. A customer may be designated as an additional
insured or certificate holder under the policy.
(b) A licensed vendor shall provide to each customer designated
as an additional insured or certificate holder a coverage form,
certificate, or other evidence of coverage in a brochure or
separate document.
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
121, Sec. 1, eff. September 1, 2009.
Sec. 4055.255. REQUIRED TRAINING. (a) Notwithstanding Section
4055.012, an agent who holds a license issued under Chapter 4051
or a substantially equivalent license issued under this code and
who is appointed by the insurer that insures a vendor may:
(1) provide the materials for the training program required
under Section 4055.012; and
(2) conduct the applicable training.
(b) An agent described by Subsection (a) shall submit the
training program materials for approval as required under Section
4055.012(c).
Amended by:
Acts 2009, 81st Leg., R.S., Ch.
121, Sec. 1, eff. September 1, 2009.