TX| The Texas Department of Insurance announces Rule Amendments to 28 TAC §5.7015 require personal auto and residential property insurers to refund the full unearned premium on a strictly pro rata basis when a policy or endorsement is cancelled, effectively prohibiting the use of short rate provisions or any retention of unearned premium amounts. Unearned premium refunds must be issued no later than the 15th business day after the effective date of cancellation or termination, and may be applied as a credit to other premium due on the same policy unless the policyholder requests otherwise.

At the same time, the rule clarifies that insurers may still include a minimum retained premium or other earned amounts for otherwise unrecoverable expenses incurred in issuing a policy, so long as those amounts and their justification are included in required rate or rule filings. The adoption adds new subsection (e) to spell out this allowance, applies the refund requirements to any unearned premium (including from endorsements), and sets a delayed effective date of September 1, 2026 to give insurers time to update forms, filings, and systems.

https://www.tdi.texas.gov/rules/2025/documents/20269730.pdfClick here to see 2026-9730 Amendments to 28 TAC §5.7015