1-1 By: Duncan (Senate Sponsor - Sibley) H.B. No. 354
1-2 (In the Senate - Received from the House May 12, 1995;
1-3 May 15, 1995, read first time and referred to Committee on Economic
1-4 Development; May 22, 1995, reported favorably by the following
1-5 vote: Yeas 8, Nays 0; May 22, 1995, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to insurance for a charitable organization.
1-9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-10 SECTION 1. Section 84.007(g), Civil Practice and Remedies
1-11 Code, is amended to read as follows:
1-12 (g) Sections 84.005 and 84.006 of this Act do not apply to
1-13 any charitable organization that does not have liability insurance
1-14 coverage in effect on any act or omission to which this chapter
1-15 applies. The coverage shall apply to the acts or omissions of the
1-16 organization and its employees and volunteers and be in the amount
1-17 of at least $500,000 for each person and $1,000,000 for each single
1-18 occurrence for death or bodily injury and $100,000 for each single
1-19 occurrence for injury to or destruction of property. The coverage
1-20 may be provided under a contract of insurance or other plan of
1-21 insurance authorized by statute and may be satisfied by the
1-22 purchase of a $1,000,000 bodily injury and property damage combined
1-23 single limit policy. Nothing in this chapter shall limit liability
1-24 of any insurer or insurance plan in an action under Chapter 21,
1-25 Insurance Code, or in an action for bad faith conduct, breach of
1-26 fiduciary duty, or negligent failure to settle a claim.
1-27 SECTION 2. Article 5.01, Insurance Code, is amended by
1-28 adding Subsection (g) to read as follows:
1-29 (g) The commissioner may establish by rule a classification
1-30 of risk applicable to motor vehicles used for limited purposes by
1-31 nonprofit organizations. If a classification of risk is
1-32 established under this subsection, the commissioner shall adopt
1-33 rules to classify risks and define the limited uses permissible for
1-34 motor vehicles insured under the classification. The commissioner
1-35 may not adopt rules under this subsection that result in insurance
1-36 premium rates for nonprofit organizations exceeding the insurance
1-37 premium rates of other analogous classifications of risk applicable
1-38 to motor vehicles used by entities other than nonprofit
1-39 organizations. In this subsection, "nonprofit organization" means
1-40 any organization exempt from federal income tax under Section
1-41 501(a) of the Internal Revenue Code of 1986 by being listed as an
1-42 exempt organization in Section 501(c)(3) or (c)(4) of that code.
1-43 SECTION 3. The importance of this legislation and the
1-44 crowded condition of the calendars in both houses create an
1-45 emergency and an imperative public necessity that the
1-46 constitutional rule requiring bills to be read on three several
1-47 days in each house be suspended, and this rule is hereby suspended.
1-48 * * * * *