Bill > SB495

This bill restricts the Texas Department of Insurance (TDI) from adopting rules based on Environmental, Social, and Governance (ESG) models, ratings, or standards unless expressly authorized by statute. The bill defines environmental, social, and governance assessments in detail, including their specific criteria such as climate change vulnerability, corporate governance practices, human capital management, and potential product impacts. Under the new law, the TDI commissioner cannot require insurers to comply with any National Association of Insurance Commissioners (NAIC) rules developed using ESG models if those rules are not explicitly authorized by statute. The bill further prohibits adopting rules that could materially and adversely affect the state's economy, business productivity, employment, or residents' health and safety. Importantly, the bill allows any person to file a declaratory judgment action challenging a rule's adoption if it appears to violate these new restrictions. The changes will apply to proposed rules filed with the secretary of state on or after the bill's effective date of September 1, 2025, representing a significant limitation on the use of ESG criteria in insurance regulation in Texas.

Business and Industry

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=SB495