{"data":{"id":"us-tx/tex.-insurance-code-542.003","jurisdiction":"us-tx","citation":"Tex. Insurance Code § 542.003","heading":"UNFAIR CLAIM SETTLEMENT PRACTICES PROHIBITED.","body":"(a) An insurer engaging in business in this state may not engage in an unfair claim settlement practice.\n(b) Any of the following acts by an insurer constitutes unfair claim settlement practices:\n(1) knowingly misrepresenting to a claimant pertinent facts or policy provisions relating to coverage at issue;\n(2) failing to acknowledge with reasonable promptness pertinent communications relating to a claim arising under the insurer's policy;\n(3) failing to adopt and implement reasonable standards for the prompt investigation of claims arising under the insurer's policies;\n(4) not attempting in good faith to effect a prompt, fair, and equitable settlement of a claim submitted in which liability has become reasonably clear;\n(5) compelling a policyholder to institute a suit to recover an amount due under a policy by offering substantially less than the amount ultimately recovered in a suit brought by the policyholder;\n(6) failing to maintain the information required by Section 542.005; or\n(7) committing another act the commissioner determines by rule constitutes an unfair claim settlement practice.\nAdded by Acts 2003, 78th Leg., ch. 1274, Sec. 2, eff. April 1, 2005.","path":["INSURANCE CODE","TITLE 5. PROTECTION OF CONSUMER INTERESTS","SUBTITLE C. DECEPTIVE, UNFAIR, AND PROHIBITED PRACTICES","CHAPTER 542. PROCESSING AND SETTLEMENT OF CLAIMS","SUBCHAPTER A. UNFAIR CLAIM SETTLEMENT PRACTICES"],"source_url":"https://statutes.capitol.texas.gov/Docs/IN/htm/IN.542.htm#542.003","current_through":"89th 2nd Called Legislative Session, 2025","vintage":"","retrieved_at":"2026-08-27T01:47:21Z","sha256":"353760cff4991b662f40f19757bb96cffcd5625241f666563974b93ef495471d","source_id":"us-tx","stale":false,"prev":"us-tx/tex.-insurance-code-542.002","next":"us-tx/tex.-insurance-code-542.004"},"notice":"GroundRules: Original legal text. Not legal advice."}