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TITLE 28INSURANCE
PART 1TEXAS DEPARTMENT OF INSURANCE
CHAPTER 5PROPERTY AND CASUALTY INSURANCE
SUBCHAPTER ETEXAS WINDSTORM INSURANCE ASSOCIATION
DIVISION 1PLAN OF OPERATION
RULE §5.4001Plan of Operation

    (A) The property eligible for catastrophe insurance shall be that property defined as "insurable property" in the Act, provided, however, that the term "insurable property" shall not include motor vehicles or any structure consisting, in whole or in part, of a mobile home unless the same is a structure, transportable in one or more sections, which is eight body feet or more in width and is 32 body feet or more in length, which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air-conditioning, and electrical systems contained therein, and which is physically attached to the land, immovable, and is constructed, blocked, supported, anchored, secured, and installed in accordance with the underwriting requirements set forth in subparagraphs (C) and (E) of this paragraph.

    (B) Each mobile home shall meet the following reasonable underwriting standards which shall include, but shall not be limited to:

      (i) the amount of insurance requested, together with other insurance is within reasonable relationship to the actual cash value of the property involved;

      (ii) consideration of the physical condition of the property, such as its construction, maintenance, or general deterioration;

      (iii) consideration of its present use or housekeeping;

      (iv) whether its use is in violation of law, public policy and morals,

      (v) and the consideration of the character or integrity of the property owner or occupant.

    (C) Each mobile home manufactured after December 31, 1975, shall be designed for location in or as though destined for the catastrophe area where wind records are hereby found to indicate wind forces of 125 miles per hour, or greater, and shall be constructed in accordance with such design as set forth in either the Texas Mobile Homes Standards Code adopted by the Texas Department of Labor and Standards pursuant to the provisions of Texas Civil Statutes, Article 5221f, or the Mobile Home Construction and Safety Standards established under the Housing and Community Development Act of 1974, Title VI, titled The National Mobile Home Construction and Safety Standards Act of 1974 (42 United States Code §5401, et seq.) as may be appropriate under Texas Civil Statutes, Article 5221f, §5.

    (D) Each mobile home described in subparagraph (C) of this paragraph or sold by a dealer, as that term is defined in Texas Civil Statutes, Article 5221f, after August 31, 1975, shall bear a seal of approval issued by the Texas Department of Labor and Standards.

    (E) Each mobile home shall be blocked, anchored, and secured, and an appropriate support, and anchoring systems shall be installed as will resist overturning and lateral movement (sliding) of the mobile home in the manner and in accordance with the Texas Mobile Home Standards Code adopted by the Texas Department of Labor and Standards pursuant to the provisions of Texas Civil Statutes, Article 5221f, or the Mobile Home Construction Safety Standards established under the Housing and Community Development Act of 1974, Title VI, titled The National Mobile Home Construction and Safety Standards Act of 1974 (42 United States Code §5401, et seq.) for mobile homes located in the catastrophe area, as may be appropriate under Texas Civil Statutes, Article 5221f, §5.

    (F) Coverage shall not be provided for loss or damage to:

      (i) awnings, carports, and patio covers, whether permanently attached or not;

      (ii) outdoor radio or television antennas including their lead-in wiring, masts, or towers;

      (iii) fences;

      (iv) seawalls, property line, and similar walls;

      (v) greenhouses, hot houses, slat houses, trellises, pergolas, or cabanas;

      (vi) wharfs, docks, piers, boathouses, bulkheads, or other structures located over or partially over water and the property therein or thereon;

      (vii) lawns, trees, shrubs, or plants;

      (viii) patio covers, screening, and supports enclosing or partially enclosing pools, patios, or other areas, whether a separate structure or attached to a building (however, with reference to this exclusion, nothing therein shall be construed to exclude loss to screening and supports of porches which are a part of a building);

      (ix) paint or waterproofing material applied to the exterior of the buildings or structures covered hereunder.

    (G) This association shall not be liable for loss or damage caused by:

      (i) blizzard or change in temperature;

      (ii) sand or dust;

      (iii) snowstorm;

      (iv) tidal wave;

      (v) high water, or overflow, whether driven by wind or not; nor

      (vi) for any loss or damage caused by rain, whether driven by wind or not, unless the wind or hail shall first make an opening in the walls or roof of the described building, and shall then be liable only for loss to the interior of the building, or the insured property therein, caused immediately by rain entering the building through such openings. This association shall not be liable under this coverage for damage caused by ensuing fire.

    (H) The liability of the association for loss or damage to a mobile home shall:

      (i) not exceed the lowest of:

        (I) the difference between the actual cash value of the insured property immediately before the loss and its actual cash value immediately after the loss; or

        (II) the cost of repairing the damage; or

        (III) the actual cash value of the insured property immediately preceding the loss; or

        (IV) the cost of replacing the insured property; or

        (V) the limit of liability stated in the declarations; and the liability thus determined shall, in addition, be subject to any deductible amount stipulated in the policy;

      (ii) in any loss involving part of a pair, set, or series of objects, pieces, or panels (whether interior or exterior), be determined by reference to:

        (I) a fair and reasonable proportion of the part of the total value of the pair, set, or series; or

        (II) the reasonable cost of repairing or replacing the damaged part so as to match the remainder as closely as reasonably possible under the circumstances; or

        (III) the reasonable cost of providing a reasonably acceptable alternative decorative effect or utilization, as the circumstances may warrant. The association does not guarantee the availability of parts or replacements and shall not, in the event of such damage to or loss of a part, be obligated for the value of, or to repair or replace, the entire pair, set, or series.

    (I) The association shall not be liable on any one loss with respect to personal effects for more than $250 on money, coin collections, or other numismatic property and paraphernalia; gold bullion; silver bullion; passports; airline, railroad, and other tickets; securities; manuscripts, stamps or other philatelic property and paraphernalia; any one article of jewelry including, but without being limited to, watches, necklaces, bracelets, gems, precious and semiprecious stones, and articles of gold and platinum; art, including, but without being limited to, paintings, sculptures, drawings, etchings, ceramics, and china; heirlooms; furs, including any article containing fur which represents its principal value; or guns.

    (J) No forms may be used to provide catastrophe insurance for a mobile home risk unless such form has been specifically approved by the Commissioner for use in insuring mobile homes risks by the association.

    (K) Catastrophe insurance shall not provide insurance coverage for any one insurable risk in excess of $84,000 on the mobile home and on household goods contained therein, which shall include all personal property usual to a residence of the insured and the insured's family.

    (L) The limit of liability for mobile homes shall be adjusted annually for inflation at a rate that reflects any change in the BOECK Index or other index that may accurately reflect changes in the cost of construction or residential values in the catastrophe area. Such adjustment shall be made by the Commissioner as part of the annual rate hearings held pursuant to Article 5.101 of the Insurance Code.

  (4) Application.

    (A) The legislature of the State of Texas has declared that an adequate market for windstorm, hail, and fire insurance for insurable property, which is immovable property at fixed locations, is necessary to the economic welfare of the State of Texas and has further declared that mobile homes have become a primary housing resource of many of the citizens of the state.

    (B) An applicant for catastrophe insurance shall apply to the association for a policy of insurance, and such application shall contain a declaration to the effect that the mobile home is physically attached to the land, immovable, and such application shall be accompanied by the following:

Cont'd...

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