By Hirschi H.B. No. 2788
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to establishment of the Texas Motor Vehicle Insurance
1-3 System and to liability for motor vehicle accidents.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. The Insurance Code is amended by adding Chapter
1-6 30 to read as follows:
1-7 Chapter 30. Texas motor vehicle insurance system
1-8 Subchapter A. General provisions
1-9 Art. 30.01. Definitions. In this chapter:
1-10 (1) "Covered person" means a person entitled to
1-11 benefits under this chapter.
1-12 (2) "Dealer" has the meaning assigned by Chapter 153,
1-13 Tax Code.
1-14 (3) "Fund" means the Texas Motor Vehicle Insurance
1-15 System fund.
1-16 (4) "Motor Fuel" has the meaning assigned by Chapter
1-17 153, Tax Code.
1-18 (5) "Motor Vehicle Insurer" means an insurer
1-19 authorized to write motor vehicle insurance in this state,
1-20 including:
1-21 (A) an insurance company;
1-22 (B) a mutual insurance company, including a
1-23 county mutual insurance company;
2-1 (C) a reciprocal insurance company or
2-2 interinsurance exchange; and
2-3 (D) a Lloyd's plan insurer.
2-4 (6) "Motor vehicle" has the meaning assigned by
2-5 Section 2, Uniform Act Regulating Traffic on Highways (Article
2-6 6701d, Vernon's Texas Civil Statutes).
2-7 (7) "System" means the Texas Motor Vehicle Insurance
2-8 System established by this chapter.
2-9 Art. 30.02. Texas Motor Vehicle Insurance System. (a) The
2-10 Texas Motor Vehicle Insurance System is established to provide
2-11 motor vehicle insurance coverage in accordance with this chapter.
2-12 (b) The system is administered by the commissioner in
2-13 accordance with rules adopted by the board.
2-14 Art. 30.03. RULES. The board may adopt rules as necessary
2-15 to implement this chapter.
2-16 Art. 30.04. AUTHORITY TO CONTRACT. The commissioner may
2-17 contract with a private accounting firm or other entity as
2-18 appropriate to administer some or all of the functions of the
2-19 commissioner under this chapter.
2-20 Art. 30.05. TEXAS MOTOR VEHICLE INSURANCE FUND. (a) The
2-21 Texas Motor Vehicle Insurance System fund is an account in the
2-22 state treasury.
2-23 (b) The fund is composed of premiums and premium surcharges
2-24 collected under this chapter. Interest on money in the fund is
2-25 credited to the fund.
3-1 (c) Money in the fund may be used only for the costs of
3-2 administering the system and to pay the cost of providing the
3-3 coverage required by this chapter.
3-4 (d) The fund is exempt from the application of Section
3-5 403.094, Government Code.
3-6 Art. 30.06. PARTICIPATION OF PUBLIC INSURANCE COUNSEL. The
3-7 public insurance counsel may participate in a proceeding held to
3-8 adopt premium rates or surcharges under this chapter in accordance
3-9 with Article 1.35A, Insurance Code.
3-10 Art. 30.07. STATUTORY REFERENCES. A reference in this
3-11 chapter to a statutory provision applies to all reenactments,
3-12 revisions, or amendments of that provision.
3-13 SUBCHAPTER B. COVERAGE
3-14 Art. 30.31. SYSTEM COVERAGE; NO FAULT. (a) The system
3-15 shall provide coverage for first party benefits to covered persons
3-16 in accordance with this subchapter.
3-17 (b) A benefit payable under coverage provided through the
3-18 system is payable without regard to the fault of the covered
3-19 person.
3-20 Art. 30.32. COVERED PERSONS. The coverage must provide
3-21 benefits for a person who suffers bodily injury, death, or property
3-22 damage through the maintenance, operation, or use of a motor
3-23 vehicle in this state, without regard to whether the person is a
3-24 resident of this state or whether the motor vehicle is registered
3-25 in this state.
4-1 Art. 30.33. BENEFITS. (a) The coverage must provide first
4-2 party benefits for:
4-3 (1) reasonable and necessary medical expenses, without
4-4 a limit or deductible;
4-5 (2) loss of income from work for a period of one year
4-6 after the date of the accident causing injury, subject to a limit
4-7 of the lesser of 80% of loss of income or $25,000 and with a
4-8 deductible equal to one week's wages;
4-9 (3) permanent disability coverage equal to 80% of loss
4-10 of income from work, subject to an annual limit of $25,000 and with
4-11 a deductible equal to one week's wages;
4-12 (4) death benefit equal to 80% of the person's income
4-13 from work for a period of five years;
4-14 (5) pain-and-suffering coverage as adopted by the
4-15 board;
4-16 (6) damage to a motor vehicle, subject to a deductible
4-17 of 5 percent of the value of the motor vehicle, but no less than
4-18 $500, as established by the rules adopted by the board; and
4-19 (7) damage to property other than a motor vehicle,
4-20 subject to a deductible of $500.
4-21 (b) Coverage through the system for medical expenses under
4-22 Subsection (a)(1) of this article is secondary to any other
4-23 insurance or benefit plan providing coverage for the expenses.
4-24 (c) A benefit for damage to a motor vehicle under Subsection
4-25 (a)(3) of this article may not include amounts necessary for new
5-1 replacement parts or replacement parts manufactured by a particular
5-2 manufacturer if alternative replacement parts of comparable quality
5-3 are available at a lower cost.
5-4 (d) The system shall offer additional coverage packages
5-5 providing benefits for the loss of income from work for a period of
5-6 one year after the date of the accident causing injury, subject to
5-7 benefit limits of $50,000 and $75,000, respectively. The board
5-8 shall adopt premium rates to be charged for the additional coverage
5-9 packages provided under this subsection. The additional premium
5-10 shall be collected by the county tax collector in accordance with
5-11 Article 30.73 of this code.
5-12 Art. 30.34. OUT-OF-STATE EXCLUSION. The system may not
5-13 provide coverage for bodily injury, death, or property damage
5-14 arising out of the maintenance, operation, or use of a motor
5-15 vehicle outside this state.
5-16 Art. 30.35. DUPLICATION OF COVERAGE PROHIBITED; SUPPLEMENTAL
5-17 INSURANCE. (a) A motor vehicle insurer may not issue insurance
5-18 providing benefits that duplicate the benefits provided under this
5-19 chapter except through the system as provided by Subchapter E of
5-20 this chapter.
5-21 (b) A motor vehicle insurer, subject to board approval and
5-22 in accordance with board rule, may issue insurance providing
5-23 benefits or indemnity coverage that supplements the benefits
5-24 provided under this chapter, including insurance providing:
5-25 (1) coverage for bodily injury, death, or property
6-1 damage arising from the maintenance, operation, or use of a vehicle
6-2 outside the state;
6-3 (2) additional coverage for property damage; and
6-4 (3) coverage for liability for damages for a serious
6-5 injury, as defined by board rule, arising from the maintenance,
6-6 operation, or use of a motor vehicle in this state.
6-7 Art. 30.36. POLICY FORMS AND ENDORSEMENTS. The board shall
6-8 adopt a policy forms and endorsements for the issuance of coverage
6-9 under this chapter.
6-10 SUBCHAPTER C. LIABILITY FOR MOTOR VEHICLE ACCIDENTS
6-11 Art. 30.51. TORT LIABILITY LIMITED. (a) Except as provided
6-12 by this subchapter, a person may not recover damages for bodily
6-13 injury or property damage arising out of the maintenance,
6-14 operation, or use of a motor vehicle in this state.
6-15 (b) Any person involved in a motor vehicle accident in this
6-16 state is subject to the limitations of this article.
6-17 Art. 30.52. EXCEPTIONS. Article 30.51(a) of this code does
6-18 not apply to a claim:
6-19 (1) of bad faith by a motor vehicle insurer;
6-20 (2) against a motor vehicle manufacturer alleging
6-21 gross negligence in the manufacture of a motor vehicle; or
6-22 (3) against a governmental or other entity alleging
6-23 gross negligence in the design, construction, or maintenance of a
6-24 public roadway.
6-25 SUBCHAPTER D. COLLECTION OF PREMIUMS
7-1 Art. 30.71. SAVE-AT-THE-PUMP PREMIUM. (a) The board shall
7-2 adopt a save-at-the-pump premium rate in accordance with this
7-3 article.
7-4 (b) The premium rate shall be established as a fixed rate
7-5 collected for each gallon of motor fuel sold in this state and
7-6 shall be in an amount necessary to fund coverage under this
7-7 chapter, adjusted to reflect the additional premiums and premium
7-8 surcharges collected under this subchapter.
7-9 Art. 30.72. COLLECTION OF SAVE-AT-THE-PUMP PREMIUM. (a)
7-10 Each dealer in this state shall collect the premium on the first
7-11 sale for use of motor fuel in this state, and shall pay the premium
7-12 to the comptroller.
7-13 (b) The comptroller shall adopt rules governing:
7-14 (1) premium collection under this article;
7-15 (2) dealer recordkeeping and reporting; and
7-16 (3) premium payment to the comptroller.
7-17 (c) To the extent possible, the comptroller by rule shall
7-18 coordinate collection of the premium under this article with
7-19 collection of motor fuel taxes under Chapter 153, Tax Code.
7-20 Art. 30.73. REGISTRATION SURCHARGE; ALTERNATIVE-FUEL VEHICLE
7-21 PREMIUM; COLLECTION OF NECESSARY INFORMATION. (a) The board shall
7-22 adopt premium surcharges to be paid at the time a motor vehicle is
7-23 registered.
7-24 (b) The board shall adopt premium rates for alternative-fuel
7-25 vehicles to be paid at the time an alternative-fuel vehicles to be
8-1 paid at the time an alternative-fuel vehicle is registered.
8-2 (c) The board may adopt rules requiring the collection of
8-3 information relating to the motor vehicle and the owner and
8-4 operators of the vehicle at the time the motor vehicle is
8-5 registered.
8-6 (d) The premium surcharges adopted under this article shall
8-7 be in amounts reflecting the insurance risk of the vehicle
8-8 registered and may vary according to the type, average gas mileage,
8-9 and age of the motor vehicle registered, whether the vehicle is
8-10 used as a private passenger vehicle or as a commercial vehicle, and
8-11 other factors that relate to the insurance risk of the vehicle
8-12 registered.
8-13 (e) The board may authorize a premium offset against the
8-14 registration fee for motor vehicles that pose a low insurance risk
8-15 in comparison to other motor vehicles.
8-16 (f) The board shall provide to each county tax collector in
8-17 this state a manual listing the applicable premium, premium
8-18 surcharge, or offset for each motor vehicle. The county tax
8-19 collector shall collect the premium or premium surcharge required
8-20 under this article and any additional premium paid under Article
8-21 30.33(e) at the time the vehicle is registered and shall pay the
8-22 surcharge and additional premium to the comptroller. The county
8-23 tax collector shall reduce the registration fee by the amount of
8-24 the offset from the fund to the account to which registration fees
8-25 are deposited.
9-1 (g) The comptroller shall adopt rules governing the
9-2 collection and payment of the premium and premium surcharge under
9-3 this article and the accounting of offsets against registration
9-4 fees.
9-5 (h) The board shall adopt a system under which the owner of
9-6 a motor vehicle is notified of the insurer to which the motor
9-7 vehicle is assigned at the time the owner registers the motor
9-8 vehicle.
9-9 Art. 30.74. SURCHARGE FOR TRAFFIC VIOLATION. (a) The board
9-10 shall adopt premium surcharges to be paid on conviction of an
9-11 offense under the Uniform Act Regulating Traffic on Highways
9-12 (Article 6701d, Vernon's Texas Civil Statutes), Article 6701l-1,
9-13 Revised Statutes, or Section 19.05(a)(2), Penal Code.
9-14 (b) The premium surcharge shall vary with the severity of
9-15 the violation as it relates to the insurance risk of the convicted
9-16 person. The board may not adopt a premium surcharge to be paid on
9-17 conviction of an offense that, in the opinion of the board, does
9-18 not relate to safety or insurance risk.
9-19 (c) The board shall provide to each court in this state a
9-20 manual listing the applicable premium surcharge for each offense
9-21 for which a surcharge is made. The surcharge shall be collected at
9-22 the time of conviction or at the time any other fine or fee is
9-23 collected in connection with the offense. The surcharge shall be
9-24 paid to the comptroller.
9-25 (d) The comptroller shall adopt rules governing the
10-1 collection and payment of the surcharge under this article.
10-2 Art. 30.75. DEPOSIT OF PREMIUM TO FUND. The comptroller
10-3 shall deposit premiums and premium surcharges collected under this
10-4 subchapter to the credit of the fund.
10-5 Art. 30.76. BORDER AREAS. (a) The board, by rule, may
10-6 designate specified areas of the state as border areas.
10-7 (b) The owner or operator of a motor vehicle registered in a
10-8 border area may be required to demonstrate that the owner or
10-9 operator purchases motor fuel for the vehicle on a regular basis in
10-10 this state before benefits are paid to that owner, operator, or a
10-11 member of the owner's family under this chapter.
10-12 (c) The owner or operator of a motor vehicle registered in a
10-13 border area who is unable to purchase motor fuel in this state on a
10-14 regular basis may apply to the commissioner to pay a premium, in an
10-15 amount adopted by the board, at the time the vehicle is registered.
10-16 SUBCHAPTER E. PROVISION OF COVERAGE
10-17 Art. 30.91. PROVISION OF COVERAGE FOR REGISTERED VEHICLES.
10-18 (a) Coverage for motor vehicles registered in this state shall be
10-19 issued by motor vehicle insurers in this state.
10-20 (b) The motor vehicle insurer to which a motor vehicle has
10-21 been assigned shall pay benefits for:
10-22 (1) the owner or operator of the vehicle;
10-23 (2) a member of the owner's family; and
10-24 (3) any other person injured through the maintenance,
10-25 operation, or use of the motor vehicle, including a passenger or
11-1 pedestrian, but not including the owner, operator, or passenger of
11-2 another vehicle involved in the accident or a member of that
11-3 owner's family.
11-4 (c) If more than one motor vehicle is involved in an
11-5 accident, the motor vehicle insurers to which those vehicles have
11-6 been assigned shall share the cost of benefits paid to a person
11-7 described by Subdivision (b)(3) on a pro rata basis in accordance
11-8 with board rule.
11-9 Art. 30.92. MOTOR VEHICLES NOT REGISTERED IN THIS STATE.
11-10 (a) The system shall pay benefits for a covered person injured
11-11 through the maintenance, operation, or use in this state of a motor
11-12 vehicle that is registered in this state.
11-13 (b) If a motor vehicle that is not registered in this state
11-14 is covered by a policy of motor vehicle insurance, the system shall
11-15 pay benefits only after any first party benefits provided under
11-16 that policy of insurance have been exhausted.
11-17 Art. 30.93. MOTOR VEHICLE INSURER PARTICIPATION. (a) The
11-18 commissioner shall divide all motor vehicles registered in this
11-19 state into random groups of approximately 5,000 motor vehicles
11-20 each.
11-21 (b) Motor vehicle insurers that satisfy the requirements of
11-22 specifications established by the board may bid to provide coverage
11-23 to a group of motor vehicles in accordance with rules adopted by
11-24 the board. The specifications established by the board must
11-25 include requirements relating to equal employment opportunities
12-1 imposed on employers by state or federal law. The specifications
12-2 may require the motor vehicle insurer to institute loss prevention
12-3 programs.
12-4 (c) The bidding shall be conducted on an annual basis.
12-5 (d) The commissioner shall enter into a group coverage
12-6 agreement with a motor vehicle insurer who is a successful bidder
12-7 under Subsection (b) of this article and shall act as the
12-8 policyholder for each group.
12-9 (e) Not later than the 45th day after the date a motor
12-10 vehicle is registered, the commissioner shall notify the operator
12-11 of the motor vehicle of the insurer to which the vehicle has been
12-12 assigned.
12-13 Art. 30.95. CLAIMS DATA. (a) The board shall adopt rules
12-14 requiring motor vehicle insurers to submit to the department data
12-15 relating to claims for benefits.
12-16 (b) An insurer may not participate in the system unless the
12-17 insurer complies with the claims data reporting requirements of
12-18 this article.
12-19 Art. 30.95. SATISFACTION REPORT CARDS. (a) A motor vehicle
12-20 insurer providing coverage under this chapter shall supply a
12-21 customer satisfaction report card to any person submitting a claim
12-22 to the insurer under this chapter.
12-23 (b) The customer satisfaction report card shall be in a form
12-24 adopted by the board and shall provide the person submitting the
12-25 claim the opportunity to report the person's satisfaction with the
13-1 motor vehicle insurer's settlement and service. The customer
13-2 satisfaction report card shall include instructions for returning
13-3 the card to the department or a designee of the department.
13-4 (c) The commissioner shall compile the results of the
13-5 customer satisfaction report cards and report the results to the
13-6 board.
13-7 (d) The board may restrict or increase a motor vehicle
13-8 insurer's opportunity to bid on the basis of its performance as
13-9 indicated by the customer satisfaction report cards.
13-10 SECTION 2. (a) The Texas Motor Vehicle
13-11 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
13-12 Statutes) is repealed.
13-13 (b) Sections 2a and 2b, Chapter 88, General Laws, Acts of
13-14 the 41st Legislature, 2nd Called Session, 1929 (Article 6675a-1 et
13-15 seq., Vernon's Texas Civil Statutes), are repealed.
13-16 (c) Subchapter A, Chapter 5, Insurance Code, is repealed
13-17 (d) This section takes effect September 1, 1994.
13-18 SECTION 3. For the first bidding period conducted under
13-19 Article 30.93, Insurance Code, as added by this Act, the board
13-20 shall adopt rules restricting bidding opportunities on the basis of
13-21 the bidder's market share of motor vehicle insurance issued in this
13-22 state.
13-23 SECTION 4. (a) The Texas Motor Vehicle Insurance System
13-24 shall provide motor vehicle insurance coverage in accordance with
13-25 Chapter 30, Insurance Code, as added by this Act, on and after
14-1 September 1, 1994.
14-2 (b) Premiums and premium surcharges may not be collected
14-3 under Subchapter D, Chapter 30, Insurance Code, as added by this
14-4 Act, before September 1, 1994.
14-5 (c) Notwithstanding Article 30.35, Insurance Code, as added
14-6 by this Act, a motor vehicle insurer may issue motor vehicle
14-7 insurance that provides coverage for periods ending before
14-8 September 1, 1994, in accordance with the law as it existed
14-9 immediately before the effective date of this Act, and that law is
14-10 continued in effect for that purpose.
14-11 SECTION 5. This Act takes effect only if the constitutional
14-12 amendment proposed by the 73rd Legislature, Regular Session, 1993,
14-13 relating to authorizing the legislature to establish a
14-14 "save-at-the-pump" motor vehicle insurance system is adopted. If
14-15 that amendment is not adopted, this act has no effect.
14-16 SECTION 6. Except as provided by Section 2(d) of this Act,
14-17 this Act takes effect November 3, 1993.
14-18 SECTION 7. The importance of this legislation and the
14-19 crowded condition of the calendars in both houses create an
14-20 emergency and an imperative public necessity that the
14-21 constitutional rule requiring bills to be read on three several
14-22 days in each house be suspended, and this rule is hereby suspended.