By Dutton                                             H.B. No. 1722
       74R6413 DLF-D
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to placement of motor vehicle insurance in affiliated
    1-3  insurers.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Subchapter A, Chapter 5, Insurance Code, is
    1-6  amended by adding Article 5.07-2 to read as follows:
    1-7        Art. 5.07-2.  PLACEMENT OF COVERAGE IN AFFILIATED INSURERS;
    1-8  REQUIRED DISCLOSURE.  (a)  In this article:
    1-9              (1)  "Affiliated" has the meaning assigned by Section
   1-10  2, Article 21.49-1, of this code.
   1-11              (2)  "Insurer"  means any insurer authorized to write
   1-12  motor vehicle insurance in this state, including a Lloyd's plan
   1-13  insurer, a county mutual insurance company, or a reciprocal or
   1-14  interinsurance exchange.
   1-15        (b)  An insurer that writes motor vehicle insurance shall
   1-16  make the disclosure required by Subsection (c) of this article if:
   1-17              (1)  the insurer is issuing or renewing motor vehicle
   1-18  insurance to a consumer;
   1-19              (2)  an affiliated insurer writes motor vehicle
   1-20  insurance; and
   1-21              (3)  the coverage being written, if written by the
   1-22  affiliated insurer, would be written at a lower rate.
   1-23        (c)  An insurer described by Subsection (b) shall disclose to
   1-24  the consumer:
    2-1              (1)  that the coverage being written, if written by the
    2-2  affiliated insurer, would be written at a lower rate; and
    2-3              (2)  the specific reasons the consumer is not eligible
    2-4  for coverage written by the affiliated insurer or, if there is no
    2-5  reason, that the affiliated insurer can provide the coverage at a
    2-6  lower rate.
    2-7        (d)  The disclosure required by this article must be made in
    2-8  writing.
    2-9        SECTION 2.  This Act takes effect September 1, 1995, and
   2-10  applies only to an insurance policy that is delivered, issued for
   2-11  delivery, or renewed on or after January 1, 1996. A policy that is
   2-12  delivered, issued for delivery, or renewed before January 1, 1996,
   2-13  is governed by the law as it existed immediately before the
   2-14  effective date of this Act, and that law is continued in effect for
   2-15  that purpose.
   2-16        SECTION 3.  The importance of this legislation and the
   2-17  crowded condition of the calendars in both houses create an
   2-18  emergency and an imperative public necessity that the
   2-19  constitutional rule requiring bills to be read on three several
   2-20  days in each house be suspended, and this rule is hereby suspended.