Public Announcements

DFW RIMS External Affairs Committee | July Update
Tracking Policy, Courts & Advocacy Shaping the Risk Landscape

The External Affairs Committee continues to track legislative discussions in the run-up to the 90th legislative session. As more information is received, we will continue to report to members on any new headlines. Here is a recap of what is going on in the political environment down in Austin.

🏛️ Texas Legislative & Regulatory Updates

On June 12, 2026, TDI issued Commissioner’s Bulletin #B-0003-26, setting expectations for insurers using AI and machine learning. The bulletin makes clear that AI-supported underwriting, fraud detection, and claims decisions must still comply with Texas insurance laws on unfair trade practices and discrimination. TDI also expects licensed human review and approval of consequential AI-driven actions before they take effect. For corporate risk managers, the directive provides leverage to demand data and transparency when algorithms contribute to unexpected non-renewals or claims denials  

🏛️ Supreme Court Decisions

In In re ACE American Insurance Company, the Texas Supreme Court held that commercial property insurers may enforce appraisal provisions even while broader coverage or bad-faith disputes are pending. The case involved a large Dallas warehouse water damage claim, where the owner sought to block appraisal by alleging bad-faith adjustment. The court rejected that argument, ruling appraisal must proceed when the dispute includes the loss amount. For corporate risk managers, the decision reinforces appraisal as an enforceable, cost-effective tool to pause litigation while the financial scope of a property or business interruption loss is independently determined.

In S&B Engineers & Constructors, Ltd. and Zurich American Insurance Co. v. Scallon Controls, Inc., a divided Texas Supreme Court held that a contractor’s contractual proportional indemnity rights survive voluntary settlement. The dispute followed a $6.75 million injury settlement, after which the contractor and insurer sought recovery from a subcontractor that claimed settlement eliminated its indemnity obligation. The court disagreed, enforcing proportional indemnity provisions post-settlement. For risk professionals, the ruling confirms the value of “Intermediate Form” indemnity agreements, while preserving the settling party’s burden to prove settlement reasonableness and the subcontractor’s share of negligence.

💥 Nuclear Verdicts - Texas

There were no recorded nuclear verdicts occurring throughout Texas in June 2026. However, there has been news related to tort reform which is one of the greatest tools corporate defendants have to fight back against excessive jury awards causing adverse economical and societal impacts. A few updates in this area include:

 CNBC reported that San Antonio-based USAA will return nearly $1 billion in savings and dividends to about 830,000 eligible Florida members between December 2025 and July 2026. CEO Juan Andrade credited Florida’s 2023 tort reforms with reducing legal defense costs and stabilizing the insurance market. The package includes a $500 million dividend, averaging about $760 per eligible auto policyholder, plus $250 million in premium savings from an average 14% statewide auto rate reduction. For corporate risk managers and insurers, the announcement highlights how tort reform can reduce legal system abuse and lower property and casualty costs.

 North Carolina has become the first state to prohibit third-party litigation funding, enacting a law that bars outside investors from financing civil lawsuits in exchange for a share of any recovery. Supporters, including insurance industry groups, say the measure will reduce litigation costs, discourage speculative lawsuits, and address a key driver of social inflation. Critics argue it could limit access to justice for plaintiffs with limited financial resources. For corporate risk managers, the legislation is an important development to monitor because it could shape litigation trends in North Carolina and serve as a model for similar reforms in other states, including Texas, seeking to address rising liability costs.

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Interested in getting involved?

The External Affairs Committee welcomes insurance professionals and attorneys who want to stay engaged in legislative, regulatory, and legal developments impacting the industry. Join us as we continue to monitor key issues and help shape meaningful dialogue across Texas.

Cory Mangum  
DFW RIMS External Affairs Committee Chair
[email protected]