Procedural Updates
Board of Directors Meeting Summary
On September 16, 2020, the Surplus Lines Stamping Office of Texas held their annual third quarter Audit & Finance Committee meeting pursuance to code 2(c)(10) of SLTX’s Plan of Operation. The committee discussed agenda topics including SLTX’s financial review, Financial Audit engagement letter for 2020 audit, and the SLTX budget for 2021.
The following day, the Stamping Office Board of Directors held their September meeting. The meeting was held via teleconference and all members were in attendance. The board discussed various topics on the agenda including approval of previous board minutes, finance and audit committee report, Legal RFP review, insurance program renewals, IT Cloud Migration RFP, status of stamping fee proposal, and the plan of operation for SLTX.
The Board of Directors also discussed and passed motions regarding the approval of previous meeting minutes as well as discussion and selection of new General Counsel based on Legal RFP review. The board also discussed the SLTX 2021 budget which will be further reviewed at the next BOD meeting.
This is a broad summary of the meeting and not intended to reflect official meeting minutes or detail the scope of any actions taken by the board. Once minutes are reviewed and approved by the Board, they will be added to the website.
The next Audit & Finance Committee meeting will take place on October 27, 2020, while the Board of Directors meeting will take place on October 28, 2020.
As always, board meetings are available to the public, and information will be posted as they are announced.
Commissioner of Insurance to Hold Public Hearing Regarding Amendments to SLTX Plan of Operation
The Texas Department of Insurance has announced a public hearing by the Commissioner of Insurance to be conducted on June 17, 2020 from 1 PM to 5 PM. The public hearing will consider amendments to the Surplus Lines Stamping Office of Texas (SLTX) Plan of Operation. An opportunity for public comments will be available during the hearing. There is a required notice and hearing by Insurance Code Section 981.153(c) before any amendments can be adopted.
Due to COVID-19, the public hearing will be conducted virtually. For more information, the Texas Department of Insurance has provided instructions on how to join and participate in the hearing. Additionally, in the event that an individual cannot access the meeting via mobile or computer, TDI has also provided instructions on how to participate.
A registration form will be provided for individuals planning to attend the public hearing. Registration forms are to be turned in before noon, Central time, on June 15, 2020 for anyone who wishes to speak during the event. Additionally, TDI asks for a summary of testimony to be turned in to ChiefClerk@tdi.texas.gov by noon, Central time, on June 15, 2020. It is crucial to register for Docket No. 2821 for those who are planning to speak. At the time of the event, individuals will be called by name when it is their turn to provide testimony.
The Texas Department of Insurance will also accept written comments regarding any amendments to the Plan of Operation, but they must by submitted before 5 PM, Central time, on June 17, 2020. Comments can be sent via mail (Office of the Chief Clerk, MC 112-2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104) or email (ChiefClerk@tdi.texas.gov) and must include the docket number.
Congressional Committee Holds Hearing on NFIP
The federal Financial Services Committee met Wednesday, June 7, 2017, to discuss the National Flood Insurance Program (NFIP) in a hearing titled, “Flood Insurance Reform: A Taxpayer’s Perspective.”
The program is set to expire on September 30, 2017, and the legislature currently has six house resolutions on the table to reform the NFIP. If passed, these measures would improve flood premium affordability, open the market to private insurers, address insurance fraud, and allow local mapping of flood-prone areas as an alternative to NFIP maps.
Congressman Jeb Hensarling, Committee Chairman, stated that the NFIP runs an annual actuarial deficit of $1.4 billion, and faces a total debt of $24.6 billion. In addition, 2 percent of all policies account for 25 percent of all claims under the program.
Ranking Member Maxine Waters noted that Congress cannot allow the program to lapse, but that it should take measures, such as addressing cost, allowing a long-term reauthorization, and putting policyholders first, to ensure the NFIP’s success.
Five individuals participated in a panel to address concerns and questions posed by the committee. Those testifying had differing opinions on how best to improve the NFIP, but most agreed that providing more affordable flood premium rates and expanding to the private insurance sector would benefit policyholders.
The NFIP must be reauthorized by Congress this session to remain operational, but no legislation has yet made it to the floor of the House of Representatives.
2016 Late Filers Information
Lone Star Lines – Volume 21, October – December
Commissioner of Insurance Approves Increase in Texas Stamping Fee Rate to 0.15% Effective January 1, 2016
On September 8, 2015, the Commissioner signed the order for the rate to be increased to .15% (.0015) from .06% (.0006), effective January 1, 2016.
The increased stamping fee rate will apply to each new or renewal surplus lines policy with an effective date on or after January 1, 2016. The new rate will also apply to policy date extensions if effective on or after this date. Policies effective on or before December 31, 2015 will run to expiration, cancellation, or next annual anniversary date (for multi-year policies) at the old rate of .06%. This includes any subsequent endorsements, audits, cancellations, reinstatements, installments, and monthly or quarterly reports.
In June 2015 the Board of Directors of the Surplus Lines Stamping Office of Texas approved a resolution recommending to the Commissioner of Insurance an increase in the stamping fee rate charged on gross premium of Texas surplus lines policies. Notice of this request was published in the Texas Register on July 31, 2015.