Tex. Ins. Code Section 651.162
Return of Unearned Premiums and Commissions


(a)

This section applies only to a premium finance agreement that contains an assignment or power of attorney for the benefit of the insurance premium finance company.

(b)

If an insurance contract listed in a premium finance agreement is canceled, the insurer shall return all unearned premiums that are due under the contract directly to the insurance premium finance company before the 61st day after the cancellation date.

(c)

The insurer may deduct from the unearned premiums returned to the insurance premium finance company the amount of any unearned commission due from the agent writing the insurance if the insurer notifies the agent to return the unearned commission to the insurance premium finance company. If the agent does not return the unearned commission to the insurance premium finance company before the 91st day after the cancellation date, the insurer shall remit the unearned commission to the insurance premium finance company before the 121st day after the cancellation date.

(d)

Notwithstanding Subsections (a)-(c), an agent is liable for the return of unearned commissions on an insurance contract written through the Texas Windstorm Insurance Association, the Texas Automobile Insurance Plan Association, or the Texas Medical Liability Insurance Underwriting Association. An agent placing business through one of those plans shall return the unearned commissions to the insurance premium finance company before the 61st day after the date the agent is notified of the cancellation.

(e)

An insurer, other than the Texas Windstorm Insurance Association, the Texas Automobile Insurance Plan Association, or the Texas Medical Liability Insurance Underwriting Association, may return the unearned premiums to the producing agent. The insurer remains liable and shall remit the unearned premiums to the insurance premium finance company before the 121st day after the cancellation date if:

(1)

the producing agent does not return the unearned premiums to the insurance premium finance company before the 91st day after the cancellation date; and

(2)

the insurance premium finance company complied with Section 651.165 (Required Notice of Certain Premium Finance Agreements).

(f)

If the insurance premium finance company failed to comply with Section 651.165 (Required Notice of Certain Premium Finance Agreements), the insurer, including the Texas Windstorm Insurance Association, the Texas Automobile Insurance Plan Association, and the Texas Medical Liability Insurance Underwriting Association, may comply with its legal duty to return the unearned premiums due under the insurance contract to the insurance premium finance company by returning those unearned premiums to the producing agent.

(g)

If the crediting of return premiums to the account of an insured results in a surplus over the amount due from the insured, the insurance premium finance company shall refund the excess to the insured. If the amount of the excess is less than $5, the insured is not entitled to a refund.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 2, eff. April 1, 2005.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 417 (H.B. 1975), Sec. 1, eff. June 19, 2009.

Source: Section 651.162 — Return of Unearned Premiums and Commissions, https://statutes.­capitol.­texas.­gov/Docs/IN/htm/IN.­651.­htm#651.­162 (accessed Jun. 5, 2024).

651.001
Definitions
651.002
Certain Conduct Not Engaging in Business as Insurance Premium Finance Company
651.003
Rules
651.004
Employment of Examiners and Investigators
651.005
Deposit and Use of Fees
651.006
Assessments
651.007
Applicability of Consumer Credit Protection Act and Regulation Z
651.008
Authority of Certain Property and Casualty Agents to Charge Interest to Certain Persons
651.051
License Required
651.052
License Fee
651.053
Entitlement of Banks and Savings and Loan Associations to License
651.054
Application for License
651.055
Refusal to Issue License
651.056
Notice of Action on Application
651.057
Issuance of License
651.058
Reciprocal License
651.059
Issuance of Multiple Licenses
651.060
Single Business Location Authorized by License
651.061
Appearance of License
651.062
Transfer or Assignment of License Prohibited
651.063
Term of License
651.064
Procedure for License Renewal
651.065
Staggered Renewal System
651.101
Books, Accounts, and Records
651.102
Annual Report
651.103
Business Name
651.104
Business Location
651.105
Relocation of Place of Business
651.106
Business Premises
651.107
Engaging in Business by Mail or Outside the Community
651.108
Certain Charges Prohibited
651.109
Limitations on Rates and Charges
651.110
Limitations on Certain Inducements or Sharing of Profits and Fees
651.111
Deceptive Advertising Prohibited
651.151
Required Form and Contents of Premium Finance Agreement
651.152
Other Required Contents
651.153
Form of Disclosures
651.154
Consolidation of Increase Attributable to Amendment of Rate Classification
651.155
Responsibilities of Insurance Agent
651.156
Taking of Incomplete Premium Finance Agreement Prohibited
651.157
Perfection of Premium Finance Agreement as Secured Transaction: Filing Not Required
651.158
Prepayment and Refund
651.159
Default Charge
651.160
Power of Attorney
651.161
Cancellation of Insurance Contract
651.162
Return of Unearned Premiums and Commissions
651.163
Assignment of Premium Finance Agreement
651.164
Restrictions on Premium Finance Agreements
651.165
Required Notice of Certain Premium Finance Agreements
651.166
Taking, Receiving, or Charging Unauthorized Amount
651.167
Effect of License Revocation, Suspension, or Surrender on Premium Finance Agreement
651.201
Examinations and Investigations of License Holders
651.202
Confidentiality of Reports and Related Material
651.203
Hearings and Investigations
651.204
Revocation or Suspension of License
651.205
Issuance of Revocation or Suspension Order
651.206
Surrender of License
651.207
License Reinstatement
651.208
Offense
651.209
Sanctions

Accessed:
Jun. 5, 2024

§ 651.162’s source at texas​.gov