By: Puente H.B. No. 108 73R1472 DLF-F A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to release of claims against certain insurers by 1-3 endorsement of a negotiable instrument. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter B, Chapter 21, Insurance Code, is 1-6 amended by adding Article 21.21-6 to read as follows: 1-7 Art. 21.21-6. RELEASE OF CLAIMS BY ENDORSEMENT OF NEGOTIABLE 1-8 INSTRUMENT. (a) Except as provided by Subsection (d) of this 1-9 article, this article applies to any insurer authorized to do 1-10 business as an insurance company or to provide insurance in this 1-11 state, including: 1-12 (1) a capital stock company; 1-13 (2) a mutual company; 1-14 (3) a fraternal benefit society; 1-15 (4) a local mutual aid association; 1-16 (5) a statewide mutual assessment company; 1-17 (6) a county mutual insurance company; 1-18 (7) a Lloyd's plan company; 1-19 (8) a reciprocal or interinsurance exchange; 1-20 (9) a stipulated premium insurance company; 1-21 (10) a farm mutual insurance company; 1-22 (11) a risk retention group; and 1-23 (12) a surplus lines carrier. 1-24 (b) An insurer may not issue a negotiable instrument that 2-1 requires the person endorsing the instrument to release the right 2-2 to pursue a claim or cause of action against the insurer or an 2-3 insured. 2-4 (c) Language in a negotiable instrument issued by an insurer 2-5 that purports to release the right to pursue a claim or cause of 2-6 action against the insurer or an insured is void. 2-7 (d) This article does not apply to a negotiable instrument 2-8 issued under: 2-9 (1) an individual or group policy of accident and 2-10 sickness insurance, including a policy written by a company subject 2-11 to Chapter 20 of this code and an evidence of coverage written by a 2-12 health maintenance organization subject to the Texas Health 2-13 Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance 2-14 Code); or 2-15 (2) a title insurance policy subject to Chapter 9 of 2-16 this code. 2-17 SECTION 2. This Act applies only to a negotiable instrument 2-18 issued on or after the effective date of this Act. A negotiable 2-19 instrument issued before the effective date of this Act is governed 2-20 by the law as it existed immediately before the effective date of 2-21 this Act and that law is continued in effect for that purpose. 2-22 SECTION 3. The importance of this legislation and the 2-23 crowded condition of the calendars in both houses create an 2-24 emergency and an imperative public necessity that the 2-25 constitutional rule requiring bills to be read on three several 2-26 days in each house be suspended, and this rule is hereby suspended, 2-27 and that this Act take effect and be in force from and after its 3-1 passage, and it is so enacted.