HB3388

HB3388 changes commercial group property insurance and creates a framework for personal-lines group property and casualty insurance. It became law without the governor’s signature and took effect June 20, 2025. The changes apply to policies delivered, issued for delivery or renewed on or after that date. Final law; history.

Commercial group policies: Under the existing Chapter 2171 framework, qualifying business groups or associations must constitute a “large risk” and meet the applicable shared underwriting/business characteristics. HB3388 requires a written application-stage disclosure stating whether the policy has a shared aggregate limit and, if so, its amount. That is a common overall coverage ceiling, potentially relevant when more than one member has losses. The bill requires disclosure here; it does not prohibit that ceiling for these commercial policies. Each covered member must receive both the certificate of insurance and the policy within 30 days after issue, delivery or renewal. Incidental casualty and liability coverage is expressly permitted. Existing commercial framework.

New personal-lines group policies: A permitted group must have at least 10 certificate holders with a preexisting connection through a trade, association, affiliation or other relationship separate from buying group insurance. The policy must produce administrative, marketing or brokerage economies of scale, and benefits must be reasonable relative to premiums. Insurers cannot renew under this framework when the group has fewer than 10 certificate holders at renewal.

These personal-lines policies may not have a shared aggregate limit or a term making payment of one member’s claims depend on another member’s claims or losses. This protects members from exhausting one another’s coverage; it does not eliminate each member’s own policy limits, deductibles or exclusions. Liability coverage incidental to the covered property risk is allowed.

Generally, insurance-law provisions that would apply to an individual policy apply to each personal-lines certificate as though it were a policy and its holder the insured, subject to the new chapter’s exceptions. The law expressly includes provisions concerning delivery, unfair claim handling, disaster-related claim-deadline extensions, cancellation/nonrenewal explanations and claim-history rules, unearned-premium refunds, material-change notices, rate-increase notices and remedies for excessive or unfairly discriminatory rates. Each referenced provision retains its own applicability conditions; the bill does not promise identical protections under every kind of insurance. Each member must receive the certificate and policy within the same 30-day issue/delivery/renewal window.

Surplus-lines handling: The law includes eligible surplus-lines insurers—the market used for coverage unavailable through ordinary authorized insurers, subject to statutory exceptions. It permits the required diligent search for ordinary-market coverage to be done annually for the group policy rather than for each member added during the policy period. Agents file the group policy with the Surplus Lines Stamping Office instead of each member’s certificate. Commercial surplus-lines insurers are excluded from Chapter 2171’s form/rate/insured-identification filing provisions; personal-lines surplus-lines insurers are excluded from the new chapter’s rate-and-form filing section. These are specific exceptions, not removal of all insurance regulation.

A person helping enroll members, issue certificates or administer a new personal-lines group policy—including collecting and remitting premiums—does not need a Chapter 4001 agent license for that role if the person receives no commission from the policy sale or related enrollments. The exception is not blanket permission to sell unrelated insurance without a license.

The new personal-lines chapter leaves separate statutory arrangements outside its scope: Chapter 2171 commercial groups, automobile group marketing for people over 55, risk-retention/purchasing groups, identity-theft coverage, designated underserved-area group insurance and specified travel insurance. The insurance commissioner may make implementing rules for both chapters.