The Texas legislature has recently passed Senate Bill 455 (“SB 455”), relating to arbitration provisions in certain surplus lines contracts. The key highlights are as follows.
A surplus lines insurance contract for a risk located wholly in Texas and that contains an arbitration agreement must provide that:
- the arbitration will be:
- conducted in Texas unless:
- the insurer and policyholder agree to a different venue after the insurer provides written notice to the policyholder of the insurer’s request for a different venue; and
- the insurer provides the policyholder with a premium credit for the costs incurred by the policyholder as a result of the change in venue; and
- governed by the laws of Texas; and
- conducted in Texas unless:
- the insurance contract will be interpreted in accordance with the laws of Texas.
Please note the bill becomes effective on September 1, 2025.
For any questions related to the above statutory changes in Texas, please contact Westmont Associates!