Relating to an appraisal process for disputed losses under personal automobile or residential property insurance policies, the official text

S.B. No. 458

AN ACT

relating to an appraisal process for disputed losses under personal

automobile or residential property insurance policies.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subtitle A, Title 10, Insurance Code, is amended

by adding Chapter 1813 to read as follows:

CHAPTER 1813. APPRAISAL OF DISPUTED LOSSES

Sec. 1813.001. APPLICABILITY OF CHAPTER. (a) This chapter

applies only to a personal automobile or residential property

insurance policy delivered, issued for delivery, or renewed in this

state by an insurer, including:

(1) a capital stock insurance company;

(2) a mutual insurance company;

(3) a county mutual insurance company;

(4) a Lloyd's plan;

(5) a reciprocal or interinsurance exchange;

(6) a farm mutual insurance company;

(7) an eligible surplus lines insurer if this state is

the insured's home state as defined by Section 981.002; and

(8) the FAIR Plan Association.

(b) This chapter does not apply to:

(1) an insurance policy delivered, issued for

delivery, or renewed by the Texas Windstorm Insurance Association;

or

(2) a commercial insurance policy.

Sec. 1813.002. RULES. (a) The commissioner shall adopt

rules necessary to implement this chapter, including:

(1) rules establishing the period in which an

appraisal under a provision required by this chapter must be

completed; and

(2) rules mandating an appraisal for total loss and

damage of the property that is the subject of the appraisal.

(b) In adopting rules establishing the period described by

Subsection (a)(1), the commissioner must consider the

qualifications and selection of appraisers and umpires for the

appraisal.

Sec. 1813.003. REQUIRED POLICY PROVISION: APPRAISAL

PROCESS. (a) An insurance policy described by Section 1813.001(a)

must contain an appraisal provision that complies with this

chapter.

(b) The appraisal provision required by this chapter is

intended to provide a type of dispute resolution process solely to

determine the amount of loss when that amount is in dispute between

the policyholder and the insurer.

Sec. 1813.004. EFFECT OF APPRAISAL. (a) An appraisal under

the provision required by this chapter does not affect any

applicable policy terms, and an appraisal award must be made in

substantial compliance with the appraisal clause of the insurance

policy.

(b) Except for fraud, accident, or material mistake

relevant to the appraisal or an appraisal award made without

authority, the amount of loss determined by an appraisal under this

chapter is binding as to the policyholder and the insurer.

SECTION 2. (a) Chapter 1813, Insurance Code, as added by

this Act, applies only to an insurance policy delivered, issued for

delivery, or renewed on or after January 1, 2026.

(b) An insurance policy form required to be filed under

Chapter 2301, Insurance Code, providing for an appraisal process

that is in use on January 1, 2026, and otherwise compliant with

Chapter 1813, Insurance Code, as added by this Act, is not required

to be filed with the Texas Department of Insurance as a consequence

of this Act.

SECTION 3. This Act takes effect September 1, 2025.

______________________________
______________________________

President of the Senate
Speaker of the House

I hereby certify that S.B. No. 458 passed the Senate on

April 9, 2025, by the following vote: Yeas 29, Nays 0, one present

not voting; and that the Senate concurred in House amendment on

May 26, 2025, by the following vote: Yeas 30, Nays 0, one present

not voting.

______________________________

Secretary of the Senate

I hereby certify that S.B. No. 458 passed the House, with

amendment, on May 20, 2025, by the following vote: Yeas 143,

Nays 0, two present not voting.

______________________________

Chief Clerk of the House

Approved:

______________________________

Date

______________________________

Governor