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Bill

HB 2517

Relating to the applicability of premium and maintenance taxes to the Texas Windstorm Insurance Association and Texas FAIR Plan Association.

89th Legislature (2025) Introduced by Jeff Barry and 4 co-sponsors

HB 2517 reduces premium and maintenance tax obligations for Texas's insurer-of-last-resort programs, potentially strengthening their financial capacity while affecting policyholders' rates and state revenues beginning September 1, 2025.

Effective on 9/1/25
#insurance--property&casualty(i0442) #texasfairplanassociation(v0747) #taxation--general(i0815) #windstormdevices&insurance(s0308) #windstorminsuranceassociation #texas(v0508)
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WeVote Research Nonpartisan
Bill Summary · HB 2517

Legislative bill overview

HB 2517 modifies the tax treatment of Texas's two insurer-of-last-resort programs—the Texas Windstorm Insurance Association (TWIA) and Texas FAIR Plan Association—by adjusting how premium and maintenance taxes apply to these state-created entities. The bill alters the financial obligations these associations bear, potentially affecting their operational costs and claims-paying capacity.

Why is this important

TWIA and the FAIR Plan serve as critical safety nets for Texans who cannot obtain coverage in the private insurance market, particularly in high-risk areas like the coast. Changes to their tax obligations directly impact their solvency, premium rates charged to policyholders, and ability to pay claims after major disasters—ultimately affecting insurance accessibility and affordability for vulnerable populations.

Potential points of contention

  • Tax burden reallocation: Reducing taxes on these associations may shift costs elsewhere in the insurance system or state budget, benefiting last-resort policyholders while potentially affecting other stakeholders
  • Claims-paying capacity vs. rate relief: The tax adjustment could improve financial reserves for catastrophic loss scenarios, but unclear whether savings translate to premium reductions or remain as surplus
  • Equity concerns: Changes may disproportionately benefit coastal or high-risk property owners versus other Texans, raising questions about fairness of cross-subsidization through insurance mechanisms

Compiled from official sources — confirm details with the bill’s official record.

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