|(a) To be eligible to obtain windstorm and hail insurance coverage from the Association for a property, an applicant or applicant's agent must have received at least one declination of coverage for the property from an insurer authorized to engage in the business of, and writing, property insurance providing windstorm and hail insurance coverage in the first tier coastal counties: (1) in order to obtain new Association coverage; and (2) every three calendar years, in order to obtain renewal Association coverage. (b) The following words and terms when used in this division shall have the following meanings unless the context clearly indicates otherwise: (1) Authorized insurer and insurer authorized--An insurer operating under a certificate of authority issued by the Texas Department of Insurance. (2) Declination-- (A) A refusal to offer or a refusal to renew coverage for the perils of windstorm and hail from an authorized insurer; or (B) An offer of a policy that includes coverage for the perils of windstorm and hail that is not substantially equivalent to the coverage offered by the Association. A policy is not substantially equivalent to an Association policy if the policy that is being offered does not provide the basic coverage(s) that the applicant is seeking. For example, a policy being offered to the applicant that includes coverage for the perils of windstorm and hail is not substantially equivalent to the coverage offered by the Association: (i) when the applicant is seeking a policy that provides coverage on a replacement cost basis and the policy being offered to the applicant only provides coverage on an actual cash value basis; or (ii) when the applicant is seeking a policy with a certain windstorm and hail deductible amount and the windstorm and hail deductible amount on the policy being offered is in excess of that amount. (3) Writing--Offering new or renewal coverage. (c) An agent shall maintain and submit to the Association at its request documentation that indicates proof of the declination required under subsection (a) of this section and that was relied upon by the agent in completing the Association's application for insurance coverage as set forth in §5.4902(b) of this division (relating to Additional Requirements). The proof must document the name of the authorized insurer that declined to offer coverage and the date of the declination. Documentation must be maintained either in writing or in an electronic format that may be printed by the agent. Documentation must be maintained for a period of not less than five years following the date of the submission of the application for Association coverage. The Association may also allow an agent to submit the requested documentation electronically in a manner that is acceptable to the Association. (d) If the Association determines that a structure does not have a declination as required by this section, the Insurance Code §2210.202, and §5.4902(b) of this division, the Association may cancel insurance coverage on the structure. The Association shall provide the policyholder and the policyholder's agent with written notice of the cancellation not later than the 30th day before the effective date of the cancellation. In accordance with §5.4001(d)(3)(A)(ii) of this subchapter (relating to Plan of Operation), the notice of cancellation must state the reason for cancellation and provide the policyholder with notice of their right to appeal the Association's action. If the policyholder, or the policyholder's agent, provides the Association prior to the date of the cancellation of the policy with proof of a declination as required by this section, the Insurance Code §2210.202, and §5.4902(b) of this division, the Association shall rescind the cancellation notice and continue coverage under the policy.