Texas Statutes and Rules Pertinent to Property and Casualty Insurance

After attending a company party at the corporate headquarters, an employee causes a car accident, is injured, and arrested for DUI. His medical injuries total $5,200, and his legal fees and fine for the DUI arrest total $12,000. How much will the company's workers compensation policy pay?

$0. A workers compensation insurer is not liable for an accident involving injuries while the employee was intoxicated. The legal fees and fine are not covered under the workers compensation policy.

An insured has a policy with an insurance company that became insolvent. The policy has $1,600 of unearned premium. How much of this premium will the insured be able to recover from the Texas Property and Casualty Insurance Guaranty Association?

$1,600 To be considered a covered claim, the claim must be under a policy issued by an insurer authorized to do business in Texas at the time of the insured event. Unearned premiums of up to $25,000 are also considered covered claims under the law, so in this scenario, the insured's unearned premium of $1,600 will be covered.

In Texas, unless higher optional limits are purchased, the maximum amount payable for all auto personal injury protection benefits arising out of a single accident shall not exceed

$2,500 The required personal injury protection benefits shall not exceed $2,500 for all such benefits, in the aggregate for each person, unless higher limits are purchased.

If an auto policy has split limits of 30/60/25, how much will the policy pay for property damage in a single accident?

$25,000 30/60/25 limits mean $30,000 will be paid for bodily injury to one person in a single accident; $60,000 is the maximum payment for all bodily injuries per accident, and $25,000 for property damage in a single accident.

Which of the following is the basic auto liability limit required for bodily injury or death to any one person in any one accident?

$30,000 The minimum auto liability limits for Texas are $30,000 for bodily injury or death to any one person in any one accident, $60,000 for bodily injury or death to 2 or more persons in any one accident, and $25,000 for damage to property of others arising out of in any one occurrence.

All of the following statements are true regarding the relationship among the amounts of insurance EXCEPT

*A. All property losses under the basic form are settled on a replacement cost basis.* B. The recovery may not exceed the ACV at the time of loss or the policy limit, whichever is smaller. C. The recovery may not exceed the ACV at the time of loss or the amount necessary to replace the property, whichever is smaller. D. The recovery may not exceed the ACV of the property at the time of loss. All property losses under the basic form are settled on an actual cash value (ACV) basis.

Lifetime benefits are paid until the employee's death for all of the following injuries except

*A. Loss of hearing in both ears.* B. Loss of sight in both eyes. C. Complete paralysis of both arms. D. Loss of both feet above the ankle. Loss of hearing in both ears is not a total disability

An insurer can cancel a personal auto policy by giving the named insured 10 days prior written notice for any of the following reasons EXCEPT if

*A. The cancellation is to take effect on the 12-month anniversary of the policy.* B. The named insured does not pay a premium when due. C. The name insured submits a fraudulent claim. D. The board finds that continuing the policy would violate the insurance laws of Texas. Cancellation to take effect on the 12-month anniversary of the policy requires the insurer to give prior written notice of at least 30 days.

The financial responsibility law in Texas is the Motor Vehicle Safety Responsibility Law. Proof of financial responsibility proves the ability to pay damages resulting from motor vehicle accidents in the following amounts:

-*$30,000* due to bodily injury or death of any one person in any one accident; -*$60,000* due to bodily injury or death of 2 or more persons in any one accident; and -*$25,000* due to damage to property of others in any one accident.

For the purposes of workers compensation insurance regulations, the term intoxication is defined as a condition characterized by the absence of normal use of mental or physical faculties resulting from the voluntary introduction into the body of any of the following:

-Alcoholic beverage; -Controlled substance or controlled substance analogue; -Dangerous drug; -Abusable glue or aerosol paint; or -Any similar substance, the use of which is regulated under state law. The term does not include the loss of normal use of mental or physical faculties resulting from the ingestion into the body of a substance taken in accordance with a prescription written for the employee by the employee's doctor or listed as an inhalation or absorption incidental to the employee's work.

For each motor vehicle insurance policy issued, an insurer must issue a standard proof of liability form titled "Texas Liability Insurance Card." The card must include the following information:

-The name and address of the insured or covered person; -The year, make, and model of each covered vehicle; -The effective date and the expiration date of the policy; -The policy number; -The name of the insurer; -The name and telephone number of the agent, if applicable; and -A statement that the policy provides the coverage required by the Texas Motor Vehicle Safety Responsibility Act.

Member insurers are assessed the amount necessary to pay the association's obligations and the expenses of handling covered claims. The assessment of each member insurer must be in the proportion that the net direct written premiums of the insurer for the calendar year preceding the assessment bear to the net direct written premiums of all member insurers for that year. For the purposes of administration and assessment, the association is divided into 3 accounts:

-The workers compensation insurance account; -The automobile insurance account; and -The account for all other lines of insurance under the association. In the case of Workers Compensation claims, the association pays the full amount of any covered claim. All other claims arising from the same occurrence are covered up to a limit of $300,000.

ll property losses under the basic, broad, and special forms are settled on an actual cash value basis (ACV). The general rule supports the principle of indemnity and that recovery may NOT exceed the smallest of the following 4 amounts:

1. The ACV of the property at the time of loss; 2. The policy limit for the coverage; 3. The amount necessary to repair or replace the property; or 4. The amount reflecting the insured's interest in the property at the time of loss.

What is a required notice of cancellation of a Homeowners policy to the insured?

10 days

The date of "maximum medical improvement" is defined as the earliest of the date that, based on medical probability, further medical improvement to an injury can no longer be reasonably anticipated, or

104 weeks.

An employee's average weekly wage is computed according to the sum of wages paid in what period of time immediately preceding the date of the injury?

13 Consecutive weeks

The limits of liability for bodily injury or property damage stated in an auto insurance policy are 30/60/25. What are the maximum limits of liability allowed for uninsured/underinsured motorist?

30/60/25 Coverage for uninsured or underinsured motorist may not exceed the limits of liability for bodily injury or property damage as stated in the insurance policy.

If a deceased employee is survived by a eligible spouse and 3 dependent children, what percentage of the death benefit will be paid to the spouse?

50% One half of the death benefit will be paid to the spouse, and one half of the benefit will be shared equally among the children.

An insurer may cancel a personal auto policy if the policy has been in effect for at least how many days?

60 days

Under Workers Compensation, an insurance carrier will pay death benefits to the legal beneficiary in an amount equal to what portion of the employee's average weekly wage?

75%

Employment Covered

A covered employee means each person in the service of another under a contract of hire, whether expressed or implied, oral or written.

Occupational Disease

A disease arising out of and in the course of employment that causes damage or harm to the physical structure of the body, including a repetitive trauma injury. The term includes a disease or infection that naturally results from the work-related disease. The term does not include an ordinary disease of life to which the general public is exposed outside of employment, unless that disease is an incident to a compensable injury or occupational disease.

Joint Underwriting Association (JUA)

A voluntary, unincorporated association of admitted insurers whose member insurers have been authorized to provide a particular form of insurance to the public. An association of insurers must have a license. Each license expires 3 years from the date it was issued unless renewed. To renew the license, a renewal application must be filed with the Commissioner along with the proper fee. The names and addresses of the officers and directors of the association, the association's constitution and other agreements governing its activities, a list of the member insurers of the association, and the name and address of the association's receiving agent all must be filed with the Commissioner.

Which of the following is NOT considered a residual market?

A. FAIR plan B. Assigned risk auto plan *C. State Property and Casualty Guaranty Association* D. Joint underwriting association FAIR plans, assigned risk plans, and a joint underwriting association are all considered residual markets. The state Guaranty Association is a mechanism for assisting the policyholders of bankrupt insurers and would not be called a residual market.

Which of the following is a requirement for eligibility for coverage in the Texas Automobile Insurance Plan?

A. The applicant must be rejected by at least two insurers in the normal market. B. The applicant must have a valid driver's license. C. The applicant must be able to pay the premium. *D. All of the above.*

Personal Injury Protection

All automobile liability insurance policies issued or delivered in Texas must provide personal injury protection (PIP) unless the insured rejects such coverage in writing. Once an insured has rejected such coverage in writing, renewal policies by the same insurer need not contain PIP unless the named insured requests such coverage in writing. An insurance company must offer the named insured *$2,500* in personal injury protection (PIP), but higher limits may be purchased. Medical Payments -Personal injury protection provides up to *$2,500 each* to the named insured, members of the named insured's household, and any authorized operator or passenger, for payment of all reasonable expenses arising from an auto accident, regardless of who caused the accident. This coverage pays for necessary medical, surgical, x-ray, or dental services, including prosthetic devices, and necessary ambulance, hospital, professional nursing, or funeral services. Loss of Income and Rehabilitation -Personal injury protection covers payment of *80% of loss of income* and the cost of hiring a caregiver for an injured person related to an auto accident. If the injured party did not earn an income at the time of the accident, the insurer must reimburse necessary and reasonable expenses incurred for essential services ordinarily performed by that person for the care and maintenance of the family or household. Personal injury protection covers any such expenses incurred within 3 years of the date of the accident. (Payment for all benefits may not exceed $2,500 for any one person.) Personal injury protection benefits may be applied for rehabilitation services made necessary because of injuries resulting from an auto accident.

Approval of rates and forms

All policy forms, endorsements and rates must be approved by the Commissioner prior to use. Each filing of rates and forms must be made no later than *60 days* before the date of delivery or use. At the end of the 60-day period a filed form or endorsement is considered approved unless otherwise disapproved by the Commissioner.

In Texas, under workers compensation law, lifetime income benefits are paid at what rate?

An amount equal to 75% of the employee's average weekly wage

Impairment Income Benefits

An employee is entitled to impairment income benefits beginning the day after he or she reaches maximum medical improvement. The employee is entitled to benefits for a period based on the employee's impairment rating.

Temporary Income Benefits

An employee is entitled to temporary income benefits if he or she has a disability and has not attained maximum medical improvement.

Statute of Limitations for Workers Comp

An employee, or a person acting on the employee's behalf, must notify the employer of an injury no later than 30 days after the date on which the injury occurred. If the injury is an occupational disease, the employer must be informed no later than 30 days after the employee knew or should have known that the injury may be related to the employment. The notice may be given to the employer, or a supervisor or manager. If the injury is an occupational disease, the employer is the person who employed the employee on the date of last injurious exposure to the hazard. If the employee fails to notify the employer of the injury, the employer and the employer's insurance carrier are relieved of liability unless -The employer, a supervisory employee eligible to receive the notice, or the employer's insurance carrier has actual knowledge of the employee's injury; -The commission determines that good cause exists for failure to provided notice in a timely manner; or -The employer or the employer's insurance carrier does not contest the claim.

Payment of Benefits

An insurance carrier must pay compensation promptly. No later than *15 days* after the insurance carrier receives written notice of an injury, the carrier will begin payment of benefits or notify the commission and the employer in writing of its refusal to pay, and advise the employee of his or her right to request a benefit review conference and the means of obtaining additional information from the commission. An insurance carrier must notify the commission in writing when it begins making income or death benefit payments. If an insurance carrier does not contest the compensability of an injury within 60 days of notification, the carrier waives its right to contest compensability. The initiation of payments by an insurance carrier does not affect the right of the carrier to continue to investigate or deny the compensability of an injury during the 60-day period. An insurance carrier may reopen the issue of the compensability of an injury if it finds evidence that could not reasonably have been discovered earlier.

Death and Burial Benefits

An insurance carrier will pay death benefits to the legal beneficiary if a compensable injury to the employee results in death. The amount of the death benefit is equal to *75%* of the *employee's average weekly wage.* An eligible spouse is entitled to receive death benefits for life or until remarriage. On remarriage, the eligible spouse is entitled to receive *104* weeks of death benefits.

Cancellation and Non-renewal: Commerical Auto

An insurer may cancel a commercial automobile liability policy at any time for the following reasons: -There was fraud in obtaining the coverage. -The insured failed to pay premiums when due. -There is an increase in hazard within the insured's control that would increase the insured's rates. -The insurer has lost reinsurance covering all or part of the policy risk. -The insurer is being placed under supervision, conservatorship, or receivership, if the cancellation or nonrenewal is approved or directed by the supervisor, conservator, or receiver. An insurer may cancel a commercial automobile liability policy that has been in effect for *less than 60 days for any reason.*

Residual Markets

Are insurance markets or facilities designed to assume risks that are generally unacceptable to the normal insurance market. *Assigned risk plans* would be considered a part of the residual market facilities. Most states have residual markets and require all admitted insurers to participate in the state's assigned risk plan for auto liability policies, workers compensation, or FAIR plans.

A recent college graduate bought a new car and is trying to get automobile insurance on it as required by the lienholder. After being rejected by several insurance companies due to his driving record, he finally talked to an agent who can get him coverage. His agent called him a residual market risk. From which type of automobile insurance plan can the applicant purchase insurance?

Assigned Risk A residual market is an insurance market or facility that assumes risks that are unacceptable to the voluntary insurance companies. Assigned risk plans are part of the residual market. All admitted insurers participate and share proportionately in insuring these higher-risk drivers.

Which of the following conditions would most likely be compensable under workers compensation?

Carpal tunnel syndrome A repetitive trauma injury arising out of employment, such as carpal tunnel syndrome, is compensable.

Texas Windstorm Insurance Association (TWIA)

Established to provide an adequate market for windstorm and hail insurance in designated areas, more specifically, in the seacoast territory of this state. The association is made up of all property insurers authorized to transact property insurance in the state. The association has the power to issue windstorm and hail insurance as well as fire and explosion insurance on insurable property. The Commissioner determines, after notice and a hearing, that a city or county is a catastrophe area by determining that windstorm and hail insurance is not reasonably available to a substantial number of property owners there because the city or county is subject to unusually frequent and severe damage from windstorm and hail. To be eligible for insurance through the association, all construction, alteration, remodeling, enlargement, and repair of, or addition to, any structure located in the catastrophe area must be performed in compliance with the applicable building code standards, as set forth in the plan of operation of the association. Any person with an insurable interest in insurable property is entitled to apply to the association for insurance and have his or her property inspected. If the association agrees to cover the property as insurable, the policy will be issued for *1 year*. The policy may be renewed annually as long as the policy remains insurable. The coverage provided by a policy issued by the association varies according to the type of building covered.

Uninsured or Underinsured Motorists

Every automobile liability insurance policy issued in Texas must offer coverage to the policyholder for recovering damages resulting from accidents with owners or operators of uninsured or underinsured motor vehicles. The policyholder may reject this coverage in writing. Once the uninsured/underinsured motorist coverage is rejected by the policyowner, the insurer is not required to provide that coverage in a reinstated or renewal insurance policy. Required Limits -*Coverage for uninsured or underinsured motorist* may not exceed the limits of liability for bodily injury or property damage as stated in the insurance policy. The amounts of limits of liability for bodily injury, sickness, disease, or death may be selected by the insured, but they may not exceed the limits of liability specified in the insured's policy ($30,000/$60,000/$25,000). Coverage for property damage is subject to a $250 deductible, and cannot be greater than the limits of liability for property damage in the insured's policy.

Insurable Property

Immovable property at a fixed location in a catastrophe area or certain moveable property contained therein.

Texas Motor Vehicle Safety Responsibility Act: Required Limits of Liability

In Texas, no motor vehicle may be operated unless there is an automobile liability insurance policy in effect on the vehicle that provides the ability to respond to damages in the amounts of the financial responsibility laws. The policy must provide coverage for bodily injury and property damage liability, uninsured and underinsured motorist coverage, and personal injury protection.

Liquidated Demand (homeowners)

In case of a total loss of insured property by fire, a fire insurance policy must be held and considered to be a *liquidated demand* against the company for the full amount of the policy. This regulation does not apply to personal property. Insurers are required to include this provision of the Insurance Code verbatim in each fire insurance policy issued on real property in this state.

Supplemental Income Benefits

In certain circumstances, an employee is entitled to supplemental income benefits after his or her impairment income benefits have expired. An employee is entitled to supplemental income benefits if, on the expiration of the impairment income benefit period, the employee -Has an impairment rating of 15% or more from the compensable injury; -Has not returned to work or has returned to work earning less than 80% of the employee's average weekly wage as a direct result of the employee's impairment; and -Has attempted in good faith to obtain employment commensurate with the employee's ability to work. If an employee is not entitled to supplemental income benefits at the time of payment of the final impairment income benefit because the employee is earning at least 80% of the employee's average weekly wage, the employee may become entitled to *supplemental income benefits* at any time within *1 year after* the date the impairment income benefit period ends if -The employee earns wages for at least 90 days that are less than 80% of the employee's average weekly wage; -The employee meets the requirements; and -The decrease of earnings is a direct result of the employee's impairment from the compensable injury.

Texas Property and Casualty Insurance Guaranty Association

In order to help claimants and policyholders avoid financial losses due to insurer insolvency, Texas has established the Property and Casualty Insurance Guaranty Association.

The Texas Windstorm Insurance Association provides windstorm and hail insurance

In the seacoast territory of this state only.

Coverage Waiting Period for Disability

Income benefits may not be paid for an injury that results in disability for less than 1 week. If the disability continues for longer than 1 week, weekly income benefits begin to accrue on the *8th day* after the injury, or if the injury does not result in immediate disability, on the 8th day after disability begins.

What happens if you operate a motored vehicle without the required insurance?

It is a *misdemeanor* punishable by a fine of between $175 and $350 for the first offense. Subsequent violations are punishable by a fine of between $350 and $1,000. In addition, a person convicted of violating this law for a second time will have his or her driver's license and motor vehicle registration suspended unless he or she establishes and maintains proof of financial responsibility for *2 years*.

The state Insurance Code defines who or what may be insured under insurance contracts. The following is the property and casualty definition:

It is lawful for any insurance company doing business in Texas under the proper certificate of authority, except life insurance companies, to insure houses, buildings and all other kinds of property against loss or damage by fire; to take all kinds of insurance on goods, merchandise, or other property in the course of transportation, whether on land or water, or any vessel afloat, wherever the same may be; to lend money on bottomry or repsondentia; to cause itself to be insured against any loss or risk it may have incurred in the course of its business." Any terms used in the policies that appear in bold face or italics must include a definition as to the exact meaning as used in the policy.

No homeowners or fire policy may be issued or renewed in Texas unless it contains the following language:

It is understood and agreed that this policy, subject to all other terms and conditions contained in this policy, when covering residential community property, as defined by state law, shall remain in full force and effect as to the interest of each spouse covered, irrespective of divorce or change of ownership between the spouses unless excluded by endorsement attached to this policy until the expiration of the policy or until cancelled in accordance with the terms and conditions of this policy."

A health care provider wants to provide medical professional liability insurance for its employees. Unfortunately, the provider has searched unsuccessfully for an insurance carrier that can provide this insurance. Which of the following will most likely be able to provide this insurance?

Joint Underwriting Association The Joint Underwriting Association (JUA) is a voluntary association of admitted insurers whose members have been authorized by the state to provide a particular type of insurance to the public. This type of insurance is not available from a private insurer in the voluntary market.

Adam is injured in a car accident caused by John. What kind of insurance would cover John's obligation to pay for Adam's injuries?

Liability insurance Liability insurance provides compensation for harm or damage to a third party that the insured is obligated to pay.

The qualify for a surplus lines license, the applicant must be licensed as a

Local Recording Agent. To be eligible for a surplus lines agent license, an applicant must be licensed as either a Managing General Agent, a Nonresident agent, or a Local Recording Agent (referring to an individual who writes property insurance).

Eligible Child

Means a child of a deceased employee who is -A minor; -Enrolled as a full-time student in an accredited educational institution and is less than 25 years of age; or -A dependent of the deceased employee at the time of the employee's death.

Which of the following was created to pay benefits due to insureds after their insurance companies have been declared insolvent?

Property and Casualty Insurance Guaranty Association

Cancellation and Nonrenewal: Personal Auto

Renewal, nonrenewal, and cancellation provisions apply to all personal auto policies except policies written through the Texas Automobile Insurance Plan. An insurer may cancel a personal auto policy that has been in effect for 60 days or more only for any of the following reasons: -Nonpayment of premiums when due; -Suspension or revocation of the driver's license or motor vehicle registration of the named insured or of any other operator who either resides in the same household or customarily operates an automobile insured under the policy. (However, an insurer may not cancel a policy for this reason if the insured agrees to an endorsement terminating coverage for the person whose license or registration is suspended or revoked.); -The Department determines that the continuation of the policy would violate the Insurance Code or any other law governing the business of insurance in this state; or -The insured submits a fraudulent claim. Cancellation of a policy for any of the reasons stated above requires a 1*0 days'* notice to the insured. An insurer may not refuse to renew a policy solely because of the insured's age.

The commission will refer an employee who is receiving supplemental income benefits to the Rehabilitation Commission if it determines that rehabilitation and training will

Return the employee to work earlier.

Words or terms that appear in an insurance policy in bold face print include

Specific definitions as to their meaning as used in the policy.

An insured under a homeowners policy who has filed two or more claims in the preceding policy year may be

Surcharged on the premium amount.

Insurance procured from an unauthorized insurer is called

Surplus lines insurance.

Declination, Cancellation, Nonrenewal of Homeowners Insurance

The Department of Insurance requires that a written statement of the reason for declination, cancellation or nonrenewal be given by the insurer to the insured or applicant upon request. An insurer cannot cancel a homeowners insurance policy if it has been in effect for *60 days or more* except for one or more of the following reasons: -Failure of the insured to pay the premium when due; -Increase in the hazard that is within the control of the insured that would produce an increase in the premium rate of the policy; -The insured submits a fraudulent claim; or -The Department determines that the continuation of the policy would violate or place the company in violation of the Insurance Code or any other law governing the business of insurance in this state. The insurer may cancel the policy by mailing *written notice* to the insured at least *10 days prior* to the effective date of cancellation. An insurer may decline to renew a policy if the insured has filed *3* or more claims under the policy in any 3-year period.

Bob's insurer declared bankruptcy. It has not yet paid his $1,000 claim. Which of the following is true?

The Property and Casualty Insurance Guaranty Association will cover his claim.

Texas Automobile Insurance Plan Association

The Texas Automobile Insurance Plan Association (TAIPA) is a nonprofit corporate entity composed of all insurers authorized to write motor vehicle liability insurance coverage in Texas. The association assigns member insurers to write auto liability policies to applicants who are required to demonstrate financial responsibility for the future. To obtain insurance through the association, an applicant and the servicing agent must certify that the applicant has been rejected for insurance by at least 2 authorized auto insurers. Anyone who obtains excess private passenger auto liability coverage over the minimum legal requirements is ineligible for insurance through the association.

If the death of an employee results from a compensable injury, the insurance carrier will pay to the person who incurred liability for the costs of burial the lesser of

The actual cost incurred for reasonable burial expenses; or *$10,000.*

Average weekly wage (workers comp)

The average weekly wage of an employee who has worked for the employer for at least *13 consecutive weeks* immediately preceding an injury is computed by dividing the sum of the wages paid in the 13 consecutive weeks immediately preceding

Maximum Medical Improvement

The date of maximum medical improvement is defined as the earliest of the date that, based on medical probability, further medical improvement to an injury can no longer be reasonably anticipated, or *104 weeks* from the date that income benefits begin.

Computation of Benefits

The following are the maximum *weekly* benefits, computed based on the state weekly average wages, rounded to the nearest whole dollar: -A weekly temporary income benefit may not exceed *100%*; -A weekly death benefit may not exceed *100%*; and -A weekly impairment income benefit and a weekly supplemental income benefit may not exceed *70%* The *maximum* weekly income benefit in effect on the date of injury is applicable for the entire time that the benefit is payable. The *minimum* weekly income benefit is 15% of the state average weekly wage, rounded to the nearest whole dollar. The minimum weekly income benefit in effect on the date of injury is applicable for the entire time that income benefits are payable. Not later than the *30th day* after the date the employer receives notice of an injury to the employee, the employer must file a wage statement showing the amount of all wages paid to the employee. An employer that fails to file a wage statement in accordance with this requirement commits a violation.

Subrogation (workers comp)

The net amount recovered by a claimant in a third-party action must be used to reimburse the insurance carrier for benefits, including medical benefits that have been paid for the compensable injury. Any amount recovered that exceeds the amount of the reimbursement will be treated as an advance against future benefits, including medical benefits that the claimant is entitled to receive. If the advance is adequate to cover all future benefits, the insurance carrier is not required to resume the payment of benefits when the advance is exhausted.

The Texas FAIR (Fair Access to Insurance Requirements) Plan Association

Was established in order to deliver residential property insurance to qualified citizens of Texas in areas determined by the Commissioner of Insurance to be underserved areas. The Association is governed by a Governing Committee composed of 11 voting members appointed by the Commissioner. Each insurer must be a member of the Association as a condition of its authority to transact residential property insurance in this state. However, agents may not hold themselves out as agents of the Association even if licensed to represent one or more member insurers of the Association with respect to policies not underwritten by the Association. T he maximum limits of liability for residential property insurance per location through the Association are *$1,000,000 for dwelling* and *$500,000 for contents.* The Association may not provide windstorm and hail insurance coverage for risks that are eligible for that coverage under the Catastrophe Property Insurance Pool Act.

Notice of Settlement of Claim under Casualty Insurance

When a casualty insurer makes an offer to settle a claim against an insured, the insurer must notify the insured in writing within *10 days* of the initial offer. Once a claim is settled, the insurer must notify the insured within *30* days. These requirements do not apply to a casualty insurance policy that requires the insured's consent to settle a claim against the insured (professional liability) or to marine insurance, or fidelity, surety or guaranty bonds.

Workers Compensation Coverage

Workers compensation coverage provides protection to employees arising out of and in the course of employment. The Labor Code further defines the *course and scope of employment* to mean any kind of activity that has to do with and originates in the business of the employer and is performed by an employee while furthering the affairs or business of the employer. The term includes activity carried out on the employer's premises and at other locations. Transportation to and from work is not included unless the transportation is paid for by the employer, the means of transportation are controlled by the employer, or the employee is directed to proceed from one place to another as part of his or her employment. Generally, travel by the employee on behalf of the employer's business is not covered if the travel is also for personal or private affairs.

An employee is injured on the job but decides not to tell his employer. He is treated in the emergency room and stays home to recuperate. Five days later, he feels better and returns to work, but the pain becomes worse, and he doesn't return for 5 more days. He then gives his medical bills to his employer for reimbursement. Based on these facts, should the workers compensation policy pay these medical bills?

Yes, the employee notified the employer within 30 days of the injury.