Texas Proposed Bill requiring Business Interruption Insurance

SB 249 is a Texas Bill recently proposed by Sen. Charles Schwertner, which would require business interruption insurance to “cover loss caused by a pandemic, including loss caused by the order of a civil authority made to prevent the spread of a pandemic.” This would apply irrespective of whether the pandemic caused a direct physical loss to the policyholder’s property.

This requirement would apply to all insurers providing business interruption insurance in Texas, “including a county mutual insurance company, farm mutual insurance company, Lloyd’s plan, and reciprocal or interinsurance exchange.” If passed and signed by the governor, the legislation would apply to policies written or renewed with an effective date on or after Jan. 1, 2022.

For more information on this Bulletin, or any other regulatory compliance matter, please contact Westmont Associates, Inc.