S.B. No. 455 amends the Texas Insurance Code to establish specific requirements for arbitration provisions in surplus lines insurance contracts. The bill introduces new subsections (d) and (e) to Section 981.101, which stipulate that any surplus lines insurance contract for risks located entirely within Texas and containing an arbitration agreement must ensure that arbitration is conducted and governed by Texas laws. Additionally, the contract must be interpreted according to Texas laws unless the insurer and policyholder mutually agree to a different venue, with the insurer providing written notice and a premium credit to the policyholder for any costs incurred due to the venue change.

Furthermore, the bill allows for surplus lines insurance contracts valued over $2 million to have different arbitration venues and governance under another state's laws, provided there is mutual consent between the insurer and policyholder. The new provisions will apply only to contracts delivered, issued for delivery, or renewed on or after January 1, 2026, while contracts prior to this date will continue to be governed by the existing law. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Insurance Code 981.101 (Insurance Code 981)
Senate Committee Report: Insurance Code 981.101 (Insurance Code 981)
Engrossed: Insurance Code 981.101 (Insurance Code 981)
House Committee Report: Insurance Code 981.101 (Insurance Code 981)
Enrolled: Insurance Code 981.101 (Insurance Code 981)