Unfair Claims Settlement Practices

What this document is

28 Tex. Admin. Code ch. 21, subch. C - Unfair Claims Settlement Practices (ss. 21.201-21.205) is a regulation published by Cornell Legal Information Institute (law.cornell.edu), publication of the Texas Administrative Code. It is one of the Texas documents that insurance license exam questions are written from, including texas personal lines, texas claims adjuster practice questions. This page summarizes it and points to the official version, which is the text to rely on.

Sections cited in practice questions

Each practice answer shows the exact passage it comes from. These are sections of this document that questions cite, with a short excerpt from the source text.

• 28 Tex. Admin. Code s. 21.203(2) (Unfair Claim Settlement Practices)

  “(2) failing to acknowledge with reasonable promptness pertinent communications with respect to claims arising under its policies, provided that "pertinent communications" will exclude written communications that are direct responses to specific inquiries made by the insurer after initial report of...”

• 28 Tex. Admin. Code s. 21.203(19) (Unfair Claim Settlement Practices)

  “(19) requiring a claimant, as a condition of settling a claim, to produce the claimant's federal income tax returns for examination or investigation by the insurer unless the claimant is ordered to produce those tax returns by a court of competent jurisdiction, the claim involves a fire loss, or...”

• 28 Tex. Admin. Code § 21.203(2) (Unfair Claim Settlement Practices)

  “provided that "pertinent communications" will exclude written communications that are direct responses to specific inquiries made by the insurer after initial report of a claim”

• 28 Tex. Admin. Code § 21.203(17) (Unfair Claim Settlement Practices)

  “(17) with respect to the Texas personal auto policy, delaying or refusing settlement of a claim solely because there is other insurance of a different type available to satisfy partially or entirely the loss forming the basis of that claim. The claimant who has a right to recover from either or...”

• 28 Tex. Admin. Code § 21.203(12) (Unfair Claim Settlement Practices)

  “(12) attempting to settle a claim for less than the amount to which a reasonable person would have believed she/he was entitled by reference to an advertisement, as described in § 21.102 of this title (relating to Scope), made by an insurer or person acting on behalf of an insurer;”

• 28 Tex. Admin. Code § 21.203(14) (Unfair Claim Settlement Practices)

  “(14) failing to establish a policy and proper controls to make certain that agents calculate and deliver to policyholders or their assignees funds due under policy provisions relative to cancellation of coverage within a reasonable time after such coverages are terminated;”

• 28 Tex. Admin. Code § 21.202(4) (Definitions)

  “For purposes of this subchapter, any written communication to an insurer by the same person which relates to the same claim, issue or question and requests or demands the same kind of relief and which arises out of the same transaction or transactions is considered to be part of the same complaint.”

• 28 Tex. Admin. Code § 21.203(6) (Unfair Claim Settlement Practices)

  “which it has received during the preceding three years or since the date of its most recent financial examination by the Commissioner of Insurance, whichever time is shorter. For purposes of this section, "substantial compliance" has the meaning set out in § 21.2503 of this title (relating to...”

• 28 Tex. Admin. Code § 21.203(9) (Unfair Claim Settlement Practices)

  “(9) failing to promptly provide to a policyholder a reasonable explanation of the basis in the insurance policy in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement;”

• 28 Tex. Admin. Code § 21.203(8) (Unfair Claim Settlement Practices)

  “(8) not attempting in good faith to promptly settle claims where liability has become reasonably clear under one portion of the policy in order to influence settlement under other portions of the policy coverage. (This provision does not apply to those situations where payment under one portion of...”

• 28 Tex. Admin. Code § 21.203(18) (Unfair Claim Settlement Practices)

  “(18) a violation of Insurance Code Chapter 542, Subchapter B, by an insurer subject to its provisions;”

• 28 Tex. Admin. Code § 21.203 (Unfair Claim Settlement Practices)(10)

  “(10) failing to affirm or deny coverage of a claim to a policyholder within a reasonable time. The reasonable submission of a reservation of rights letter by an insurer to a policyholder within a reasonable time is deemed compliance with the provisions of this paragraph;”

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