H.B. No. 3689 seeks to enhance the financial framework of the Texas Windstorm Insurance Association (TWIA) by establishing a new Subchapter B-2 within Chapter 2210 of the Insurance Code. This new subchapter introduces provisions for managing excess losses and operating expenses incurred after December 31, 2025, allowing for financing arrangements with the state that can provide up to $1 billion in funding following catastrophic events. The bill emphasizes that public securities are not a sustainable long-term funding solution, advocating instead for the use of state funds and catastrophe surcharges to ensure TWIA's financial stability and its ability to offer insurance coverage in coastal regions.

Key amendments include the introduction of definitions for various financial terms related to financing arrangements, as well as stipulations regarding the management of excess losses and operating expenses. The bill mandates the commissioner to provide an annual financial report on the catastrophe reserve trust fund and outlines conditions for imposing catastrophe surcharges, which will be treated as separate charges not subject to premium tax or commissions. Additionally, the bill limits personal liability for stakeholders involved in surcharge collection and repeals certain existing provisions of the Insurance Code effective September 1, 2027. Overall, the legislation aims to create a structured approach to managing financial obligations arising from catastrophic events while safeguarding state resources.

Statutes affected:
Introduced: Insurance Code 2210.071, Insurance Code 2210.0715, Insurance Code 2210.075, Insurance Code 2210.452, Insurance Code 2210.4521, Insurance Code 2210.453, Insurance Code 2210.601, Insurance Code 2210.0081, Insurance Code 2210.056, Insurance Code 2210.1052, Insurance Code 2210.355, Insurance Code 2210.363 (Insurance Code 2210)
House Committee Report: Insurance Code 2210.071, Insurance Code 2210.0715, Insurance Code 2210.075, Insurance Code 2210.452, Insurance Code 2210.4521, Insurance Code 2210.453, Insurance Code 2210.601, Insurance Code 2210.0081, Insurance Code 2210.056, Insurance Code 2210.1052, Insurance Code 2210.355, Insurance Code 2210.363 (Insurance Code 2210)
Engrossed: Insurance Code 2210.071, Insurance Code 2210.0715, Insurance Code 2210.075, Insurance Code 2210.452, Insurance Code 2210.4521, Insurance Code 2210.453, Insurance Code 2210.601, Insurance Code 2210.0081, Insurance Code 2210.056, Insurance Code 2210.1052, Insurance Code 2210.355, Insurance Code 2210.363 (Insurance Code 2210)
Senate Committee Report: Insurance Code 2210.003, Insurance Code 2210.071, Insurance Code 2210.0715, Insurance Code 2210.075, Insurance Code 2210.452, Insurance Code 2210.4521, Insurance Code 2210.453, Insurance Code 2210.601, Insurance Code 2210.0081, Insurance Code 2210.056, Insurance Code 2210.1052, Insurance Code 2210.355, Insurance Code 2210.363 (Insurance Code 2210)
Enrolled: Insurance Code 2210.003, Insurance Code 2210.071, Insurance Code 2210.0715, Insurance Code 2210.075, Insurance Code 2210.452, Insurance Code 2210.4521, Insurance Code 2210.453, Insurance Code 2210.601, Insurance Code 2210.0081, Insurance Code 2210.056, Insurance Code 2210.1052, Insurance Code 2210.355, Insurance Code 2210.363 (Insurance Code 2210)