Texas Administrative Code Title 28 - INSURANCE
📘 OVERVIEW OF TITLE 28 - INSURANCE (Texas Administrative Code)
Title 28 of the Texas Administrative Code contains detailed rules that regulate:
The business of insurance (life, health, property, casualty, etc.)
Licensing and conduct of insurers, agents, and adjusters
Consumer protections
Rate and policy form regulations
Financial solvency requirements
Workers' compensation insurance
Health Maintenance Organizations (HMOs)
Insurance fraud prevention
Claims handling practices
It is broken into divisions called Parts, each governing specific sectors or functions.
🧩 STRUCTURE OF TITLE 28
Here’s a simplified breakdown of some major parts:
| Part | Agency/Subject |
|---|---|
| Part 1 | Texas Department of Insurance (TDI) |
| Part 2 | State Board of Insurance (historical/legacy rules) |
| Part 4 | Office of the Injured Employee Counsel |
| Part 5 | Division of Workers' Compensation |
| Part 8 | Texas Health Insurance Pool (now defunct) |
Each Part contains Chapters that cover specific areas. For example:
Chapter 3 – Life, Accident, and Health Insurance and Annuities
Chapter 5 – Property and Casualty Insurance
Chapter 7 – Corporate and Financial Regulation
Chapter 21 – Trade Practices (Unfair Competition and Deceptive Practices)
Chapter 26 – Small Employer Health Insurance Regulations
🔍 EXPLANATION OF SELECTED CHAPTERS (WITH CASE LAW)
🔹 Chapter 21: Trade Practices
This chapter enforces fair marketing and claims practices, including:
Unfair discrimination
Misrepresentation of policy terms
Failure to promptly pay claims
📚 Case Law: Vail v. Texas Farm Bureau Mutual Insurance Co., 754 S.W.2d 129 (Tex. 1988)
Holding: The Texas Supreme Court held that insureds may recover under the Texas Deceptive Trade Practices Act (DTPA) and the Insurance Code for an insurer's bad faith failure to pay a claim.
Relevance: Chapter 21 regulations support this by detailing fair claims handling rules. For example, Section 21.203 prohibits misrepresentation of policy terms.
🔹 Chapter 5: Property and Casualty Insurance
This includes rate filings, underwriting guidelines, and policy forms for property and casualty insurance.
📚 Case Law: State Farm Lloyds v. Nicolau, 951 S.W.2d 444 (Tex. 1997)
Holding: The court upheld a jury award against an insurer for breach of duty of good faith and fair dealing for denying a homeowner's claim after a questionable investigation.
Relevance: Chapter 5 contains rules about underwriting guidelines and policy approval, which are aimed at preventing the type of denial at issue here.
🔹 Chapter 3: Life and Health Insurance
Covers provisions for:
Group and individual health insurance
Life insurance policy forms and rates
Minimum standards for benefits
Disclosure requirements
📚 Case Law: Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211 (Tex. 2003)
Holding: The court found no bad faith when the insurer had a reasonable basis to deny disability benefits.
Relevance: Chapter 3 outlines disability policy standards and disclosure rules that inform how these disputes are judged.
🔹 Chapter 7: Corporate and Financial Regulation
This chapter regulates the financial condition of insurers, including:
Solvency
Reinsurance
Investments
Statutory accounting
📚 Case Law: Farm & Ranch Investors, Ltd. v. Titan Indem. Co., 788 S.W.2d 615 (Tex. App.—El Paso 1990)
Relevance: Although not directly citing TAC, the case touches on insurer insolvency and delayed claim payments, which fall under Chapter 7 compliance.
🔹 Workers' Compensation Rules (Part 5, Chapters 120–133)
Administered by the Division of Workers’ Compensation (DWC), this section governs:
Claims process
Benefit disputes
Medical fee guidelines
Provider licensing
📚 Case Law: Texas Workers’ Compensation Commission v. Garcia, 893 S.W.2d 504 (Tex. 1995)
Holding: The Texas Supreme Court upheld the constitutionality of the state’s workers’ comp reforms.
Relevance: The DWC rules in Title 28 codify many of those reforms, including dispute resolution procedures and timelines for benefits.
🚨 ENFORCEMENT AND PENALTIES
Violations of Title 28 can lead to:
Administrative penalties
License suspension/revocation
Restitution orders
Civil litigation under the Texas Insurance Code and DTPA
The Texas Department of Insurance has authority under Ch. 82, 83, 84 of the Insurance Code to enforce these rules.
🧠 INTERPLAY WITH OTHER LAWS
Texas Insurance Code: Title 28 rules implement the broader statutes found here.
Deceptive Trade Practices Act (DTPA): Consumers often use this alongside TAC violations.
Texas Occupations Code: Governs professional licensing, which sometimes overlaps.
Texas Labor Code: For workers’ compensation, in conjunction with TAC Title 28 Part 5.
✅ SUMMARY
| Aspect | Summary |
|---|---|
| Purpose | Regulates the insurance industry and protects consumers |
| Administered by | Texas Department of Insurance (TDI) |
| Key Areas | Licensing, rates, claims, solvency, fraud, workers’ comp |
| Legal Authority | Texas Insurance Code; TDI Rulemaking |
| Enforcement | Administrative sanctions + civil penalties |
RELATED Blog
0 comments