2026 Texas Insurance Changes: What Agents Must Know

2026 brings major changes for Texas insurance agents. New laws, updated regulations, and market shifts are affecting how agents serve clients and run their businesses.

Here’s what every Texas insurance agent needs to know.

Key 2026 Updates at a Glance

What’s New	What It Means for Agents
HB 2067	Insurers must give written reasons when declining, canceling, or not renewing policies.
TDI AI Guidance	AI cannot replace licensed agents; decisions must be reviewed by a person.
SB 458	Appraisal clauses are now mandatory in personal auto and residential property policies.
Market Trends	Personal lines market stabilizing, but underwriting remains tight.

HB 2067: New Transparency Law

Starting January 1, 2026, insurers must provide written reasons if an auto or homeowners policy is declined, canceled, or not renewed.

This applies to all property and casualty insurers, including farm mutual companies. It helps clients understand why coverage was denied and what they can do to improve eligibility.

What this means for agents

• Clients will ask for explanations of declinations or non-renewals.
• Be prepared to discuss underwriting guidelines and carrier expectations.
• Use these conversations to educate clients and build trust.

How to use HB 2067 to strengthen client relationships

1. Review any adverse action notice with the client.
2. Explain what triggered the decision (e.g., roof age, claim history, underwriting changes).
3. Advise clients on steps to improve their risk profile.

Understanding HB 2067 helps agents stay compliant and better support clients.

TDI Guidance on AI in Insurance

In June 2026, the Texas Department of Insurance clarified how insurers may use AI.

Key points

• AI cannot replace licensed agents for tasks requiring judgment or legal compliance.
• AI decisions must follow all insurance laws.
• AI must not treat anyone unfairly based on race, religion, age, gender, marital status, location, disability, or other protected traits.
• AI-derived rates must be fair, reasonable, and adequate.
• Insurers must review AI decisions and monitor for errors or bias.

What this means for agents

AI can assist with tasks, but licensed agents still provide judgment, advice, and expertise. Following these guidelines ensures compliance while using AI responsibly.

SB 458: New Appraisal Rules

Effective January 1, 2026, SB 458 requires binding appraisal clauses in all personal auto and residential property policies.

TDI rules define timelines, notice requirements, and appraiser qualifications.

Key changes

1. Mandatory appraisal language in all policies. Carriers cannot remove it.
2. Either party can demand appraisal; no mutual agreement is needed.
3. No proof of negotiation failure is required.
4. Hard deadlines: Appraisers have 120 days to agree; if an umpire is needed, the award must be issued within 240 days.
5. Qualifications: Appraisers and umpires must be competent, independent, and disinterested. Residential property appraisers must hold specific credentials.
6. One-year demand window: Requests must be made within one year of the insurer’s notice accepting coverage.

Note: Appraisal determines the amount of loss, not whether a loss is covered.

Understanding SB 458 helps agents guide clients through claims more effectively.