By Nelson S.B. No. 1048
74R2246 DLF-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to motor vehicle insurance coverage and liability for
1-3 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 27 to read as follows:
1-7 CHAPTER 27. COMPREHENSIVE MOTOR VEHICLE INSURANCE REPARATIONS
1-8 SUBCHAPTER A. GENERAL PROVISIONS
1-9 Art. 27.01. DEFINITIONS. In this chapter:
1-10 (1) "Bus" means:
1-11 (A) a motor vehicle, owned by a governmental
1-12 agency or privately owned and operated for compensation, used to
1-13 transport children to or from school; or
1-14 (B) a motor vehicle that has a seating capacity
1-15 for 15 or more passengers in addition to the driver and that is
1-16 used for the transportation of persons.
1-17 (2) "Covered economic loss" means a loss for which
1-18 first-party benefits must be paid under Article 27.17 of this code.
1-19 (3) "Covered person" means a person entitled to
1-20 benefits under Article 27.11(a) of this code or covered by a
1-21 certificate of self-insurance under Section 34, Texas Motor Vehicle
1-22 Safety-Responsibility Act (Section 6701h, Vernon's Texas Civil
1-23 Statutes).
1-24 (4) "First-party benefits" means payments made to a
2-1 covered person to reimburse the person for a covered economic loss.
2-2 (5) "Insurer" means an insurance company, a
2-3 corporation, an interinsurance exchange, a mutual, a county mutual,
2-4 a reciprocal, an association, a Lloyd's, or other insurer that
2-5 writes any form of motor vehicle insurance that is delivered,
2-6 issued for delivery, or renewed in this state.
2-7 (6) "Medical expenses" means all necessary expenses
2-8 incurred for any professional health service, including expenses
2-9 incurred for:
2-10 (A) medical, hospital, surgical, nursing,
2-11 dental, ambulance, X-ray, prescription drug, and prosthetic
2-12 products or services;
2-13 (B) psychiatric, physical, and occupational
2-14 therapy and rehabilitation services; and
2-15 (C) nonmedical remedial care or treatment
2-16 rendered in accordance with a religious method of healing
2-17 recognized by the laws of this state.
2-18 (7) "Member of named insured's household" means a
2-19 spouse, child, or relative of the named insured who regularly
2-20 resides in the named insured's household.
2-21 (8) "Motorcycle" has the meaning assigned by Section
2-22 1, Texas Motor Vehicle Safety-Responsibility Act (Article 6701h,
2-23 Vernon's Texas Civil Statutes).
2-24 (9) "Motor vehicle" has the meaning assigned by
2-25 Section 1, Texas Motor Vehicle Safety-Responsibility Act (Article
2-26 6701h, Vernon's Texas Civil Statutes).
2-27 (10) "Motor vehicle insurance" means a policy of
3-1 insurance delivered, issued for delivery, or renewed in this state
3-2 that provides coverage for bodily injury resulting from the use of
3-3 a motor vehicle.
3-4 (11) "Noneconomic loss" means a detriment caused by
3-5 bodily injury that arises out of the use of a motor vehicle other
3-6 than economic loss, and includes pain and suffering.
3-7 (12) "Operator" has the meaning assigned by Section 1,
3-8 Texas Motor Vehicle Safety-Responsibility Act (Article 6701h,
3-9 Vernon's Texas Civil Statutes).
3-10 (13) "Owner" has the meaning assigned by Section 1,
3-11 Texas Motor Vehicle Safety-Responsibility Act (Article 6701h,
3-12 Vernon's Texas Civil Statutes).
3-13 (14) "Speed contest" means a competition or race
3-14 formally or otherwise arranged between the driver of a motor
3-15 vehicle covered by the insurance policy and the driver of another
3-16 vehicle, without regard to whether the competition or race is for
3-17 compensation. The term does not include operation of a vehicle at
3-18 a speed that exceeds the legal speed limit if the driver is not
3-19 engaged in such a competition or race.
3-20 (15) "Uninsured motor vehicle" means a motor vehicle
3-21 that is:
3-22 (A) not covered by a policy of insurance that
3-23 meets the requirements of this chapter; or
3-24 (B) owned by a person whose identity is unknown
3-25 and unascertainable.
3-26 (Sections 27.02-27.10 reserved for expansion
3-27 SUBCHAPTER B. REQUIRED COVERAGE
4-1 Art. 27.11. FIRST-PARTY BENEFITS; ADDITIONAL FINANCIAL
4-2 SECURITY REQUIRED. (a) Each motor vehicle insurance policy must
4-3 provide for the payment of first-party benefits:
4-4 (1) for bodily injury that arises out of the use in
4-5 this state of a motor vehicle covered by the policy and sustained
4-6 by:
4-7 (A) the named insured;
4-8 (B) a member of the named insured's household;
4-9 (C) a passenger or operator of a motor vehicle
4-10 covered by the policy;
4-11 (D) a person who is a passenger of a motor
4-12 vehicle operated by the named insured or by a member of the named
4-13 insured's household and who is not covered by another motor vehicle
4-14 insurance policy that provides first-party benefits under this
4-15 article;
4-16 (E) a pedestrian injured through the use of a
4-17 motor vehicle covered by the policy; and
4-18 (F) a pedestrian injured through the use of a
4-19 motor vehicle that is:
4-20 (i) not owned by the pedestrian;
4-21 (ii) operated by the named insured or a
4-22 member of the named insured's household; and
4-23 (iii) not covered by another motor vehicle
4-24 insurance policy that meets the requirements of this article;
4-25 (2) to the named insured and members of the named
4-26 insured's household, for bodily injury that arises out of the use,
4-27 outside of this state, but in the United States, its territories or
5-1 possessions, or Canada, of a motor vehicle covered by the policy or
5-2 covered by another policy;
5-3 (3) to the named insured and members of the named
5-4 insured's household, for bodily injury that arises out of the use,
5-5 in the United States, its territories or possessions, or Canada, of
5-6 an uninsured motor vehicle, including a motorcycle; and
5-7 (4) a resident of this state who is not the owner of a
5-8 motor vehicle for which coverage for first-party benefits is
5-9 required by the Texas Motor Vehicle Safety-Responsibility Act
5-10 (Article 6701h, Vernon's Texas Civil Statutes) and who is not a
5-11 member of a named insured's household covered by another policy
5-12 providing first-party benefits under this article, for bodily
5-13 injury that arises out of the use, outside of this state, but in
5-14 the United States, its territories or possessions, or Canada, of a
5-15 motor vehicle covered by the policy.
5-16 (b) A motor vehicle insurance policy under this article must
5-17 provide at least $50,000 in first-party benefits for each covered
5-18 person in one accident.
5-19 (c) Each motor vehicle insurance policy under this article
5-20 must provide liability coverage in an amount of at least $15,000,
5-21 indemnifying the named insured, a member of the named insured's
5-22 household, and an operator of a motor vehicle owned by the named
5-23 insured who is operating the vehicle with the permission of the
5-24 named insured for liability imposed by law for injury to or
5-25 destruction of property of others that arises out of the use of a
5-26 motor vehicle. Coverage under this subsection may be subject to a
5-27 deductible of not more than $250.
6-1 (d) This article does not apply to a motor vehicle insurance
6-2 policy issued to the owner or operator of a motorcycle. Except as
6-3 provided by Subsection (a)(3) of this article, the benefits
6-4 required by this article may not be paid to a person for bodily
6-5 injury arising out of the use of a motorcycle.
6-6 Art. 27.12. MOTORCYCLE INSURANCE. (a) Each policy of
6-7 liability insurance covering a motorcycle and issued to satisfy the
6-8 requirements of the Texas Motor Vehicle Safety-Responsibility Act
6-9 (Article 6701h, Vernon's Texas Civil Statutes) must also provide
6-10 for the payment of first-party benefits to persons, other than the
6-11 occupants of the covered motorcycle, another motorcycle, or a motor
6-12 vehicle, for a loss that arises out of the use or operation of the
6-13 motorcycle in this state.
6-14 (b) A motorcycle insurance policy under this article must
6-15 provide at least $50,000 in first-party benefits for each covered
6-16 person in one accident.
6-17 Art. 27.13. DEATH BENEFIT. Each motor vehicle insurance
6-18 policy must provide a death benefit in the amount of $2,000 for the
6-19 death of a person who would have been entitled to first-party
6-20 benefits under Article 27.11(a) or 27.12 of this code had the
6-21 person survived. The death benefit required by this article is in
6-22 addition to first-party benefits payable as a result of the use of
6-23 the motor vehicle, including a motorcycle, and is payable to the
6-24 estate of the deceased.
6-25 Art. 27.14. EXCLUSIONS. A policy of motor vehicle insurance
6-26 under Article 27.11 or 27.13 of this code may exclude payment of
6-27 first-party benefits to a covered person whose conduct contributed
7-1 to the injury sustained if:
7-2 (1) the injury was caused intentionally;
7-3 (2) the injury was caused while the covered person was
7-4 committing a felony, seeking to evade lawful apprehension by a law
7-5 enforcement officer, operating a motor vehicle in a speed contest,
7-6 or operating or occupying a motor vehicle known by the covered
7-7 person to be stolen; or
7-8 (3) the injury was caused while the covered person was
7-9 under the influence of:
7-10 (A) alcohol;
7-11 (B) a controlled substance, as defined by
7-12 Section 481.002, Health and Safety Code;
7-13 (C) a volatile chemical listed in Section
7-14 484.002, Health and Safety Code; or
7-15 (D) an abusable glue or aerosol paint, as
7-16 defined by Section 485.001, Health and Safety Code.
7-17 Art. 27.15. DEDUCTIBLES. (a) Each insurer who offers motor
7-18 vehicle insurance that provides first-party benefits under Article
7-19 27.11 of this code shall offer that insurance both:
7-20 (1) without a deductible; and
7-21 (2) with a deductible of not more than $200 applicable
7-22 only to the covered economic loss of the named insured and members
7-23 of the named insured's household.
7-24 (b) The commissioner shall approve a higher deductible for
7-25 policies providing additional benefits or to coordinate first-party
7-26 benefits with other benefits provided under the policy or provided
7-27 by other policies. A deductible approved by the commissioner
8-1 applies only to the claims of the named insured and members of the
8-2 named insured's household.
8-3 Art. 27.16. ADDITIONAL BENEFITS. This chapter does not
8-4 prevent an insurer from providing benefits broader than or in
8-5 addition to the minimum benefits enumerated in this subchapter,
8-6 subject to the rules and forms approved by the commissioner.
8-7 Art. 27.17. COVERED ECONOMIC LOSS. (a) First party
8-8 benefits required by this subchapter must provide coverage for
8-9 expenses and losses, other than loss incurred because of death,
8-10 resulting from bodily injury that arises out of the use of a motor
8-11 vehicle. Benefits for covered economic loss paid under this
8-12 article are limited to:
8-13 (1) medical expenses incurred not later than the first
8-14 anniversary of the accident causing injury, except as provided by
8-15 Subsection (b) of this article;
8-16 (2) loss of earnings not to exceed $1,000 per month,
8-17 for the period ending on the third anniversary of the accident
8-18 causing injury; and
8-19 (3) other reasonable and necessary expenses, not to
8-20 exceed $25 per day, incurred not later than the first anniversary
8-21 of the accident causing injury.
8-22 (b) The policy must provide first-party benefits for medical
8-23 expenses incurred after the first anniversary of the accident
8-24 causing injury if, before the first anniversary of the accident, it
8-25 appeared that additional medical expenses might be incurred after
8-26 that date.
8-27 Art. 27.18. LOSS OF EARNINGS. (a) In computing covered
9-1 economic loss under Article 27.17(a)(2) of this code, "loss of
9-2 earnings" means 70 percent of the sum of:
9-3 (1) the amount actually incurred of loss of earnings
9-4 from work that a person would have performed had the person not
9-5 been injured; and
9-6 (2) the amount of reasonable and necessary expenses
9-7 incurred by the injured person in obtaining services in lieu of
9-8 those that the person would have performed for income.
9-9 (b) A covered person is not entitled to receive first-party
9-10 benefits for loss of earnings to the extent the person's loss of
9-11 earnings is offset by payments from that person's employer, whether
9-12 the payments are required by statute or contract or are made
9-13 voluntarily by the employer, unless the payments from the employer
9-14 reduce the covered person's income or level of future benefits that
9-15 arise from a subsequent illness or injury.
9-16 Art. 27.19. USE OF COVERED VEHICLE OUTSIDE STATE. A policy
9-17 of insurance that provides first-party benefits under Article 27.11
9-18 of this code must provide that a covered motor vehicle used in
9-19 another state or a Canadian province is covered by at least the
9-20 minimum amount of insurance coverage required by the laws of that
9-21 state or province.
9-22 Art. 27.20. COVERAGE FOR NONRESIDENT MOTORISTS. (a) Each
9-23 insurer authorized to transact or transacting business in this
9-24 state, and each insurer controlling, controlled by, or under common
9-25 control by or with an insurer authorized to transact or transacting
9-26 business in this state, that sells a policy providing motor vehicle
9-27 insurance coverage or similar coverage in any state or Canadian
10-1 province shall include in each policy coverage to satisfy the
10-2 requirements of Article 27.11 of this code applicable to a motor
10-3 vehicle covered by the policy when the vehicle is used in this
10-4 state.
10-5 (b) A policy sold by an insurer subject to Subsection (a) of
10-6 this article shall be construed to provide coverage described in
10-7 Article 27.11 of this code.
10-8 Art. 27.21. PRIMARY COVERAGE. (a) Coverage provided by
10-9 insurance under this chapter is the primary coverage for bodily
10-10 injury to a named insured or to a member of the named insured's
10-11 household and must be exhausted before the covered person may
10-12 collect benefits from a different policy.
10-13 (b) A policy form approved by the commissioner for motor
10-14 vehicle insurance under this chapter may limit or prohibit recovery
10-15 for one occurrence from more than one coverage or policy or from a
10-16 coverage or policy and a tortfeasor.
10-17 Art. 27.22. PAYMENT OF FIRST-PARTY BENEFITS TO PASSENGER ON
10-18 BUS. First-party benefits for a bus passenger, other than the
10-19 operator or owner of the bus or an employee of the owner or
10-20 operator, who is injured in a motor vehicle accident in this state
10-21 must be provided by each motor vehicle insurance policy under which
10-22 the injured person is a named insured or a member of a named
10-23 insured's household. If the injured person is not a named insured
10-24 or a member of a named insured's household on a motor vehicle
10-25 insurance policy, first-party benefits shall be provided by the
10-26 insurer of the bus.
10-27 Art. 27.23. PROMPT PAYMENT OF CLAIMS. Payment of
11-1 first-party benefits under this chapter is subject to Article 21.55
11-2 of this code.
11-3 Art. 27.24. NONCONFORMING POLICIES. A policy of insurance
11-4 represented by an insurer as meeting the requirements of the Texas
11-5 Motor Vehicle Safety-Responsibility Act (Article 6701h, Vernon's
11-6 Texas Civil Statutes) shall be construed to meet the requirements
11-7 of this chapter.
11-8 (Sections 27.25-27.50 reserved for expansion
11-9 SUBCHAPTER C. CIVIL LIABILITY
11-10 Art. 27.51. ACCEPTANCE OF SUBCHAPTER. By registering,
11-11 maintaining, or using a motor vehicle in this state, a person
11-12 accepts the provisions of this subchapter.
11-13 Art. 27.52. LIABILITY FOR USE OF MOTOR VEHICLE. (a)
11-14 Notwithstanding any other law and except as provided by Articles
11-15 27.53, 27.54, and 27.55 of this code, a covered person is not
11-16 liable for covered economic loss or noneconomic loss resulting from
11-17 bodily injury that arises out of the use in this state of a motor
11-18 vehicle. This subsection does not apply to a loss that arises out
11-19 of the use of a motorcycle operated by any person.
11-20 (b) Notwithstanding any other law and except as provided by
11-21 Articles 27.53, 27.54, and 27.55 of this code, a covered person may
11-22 not recover for covered economic loss that arises out of the use of
11-23 a motorcycle in this state from the owner, operator, or occupant of
11-24 a motorcycle that is covered by a policy of insurance that meets
11-25 the requirements of Article 27.12 of this code and the financial
11-26 responsibility requirements of the Texas Motor Vehicle
11-27 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
12-1 Statutes).
12-2 Art. 27.53. EXCEPTION; COVERED ECONOMIC LOSS IN EXCESS OF
12-3 $50,000. A covered person may be held liable for the amount of
12-4 covered economic loss that exceeds $50,000.
12-5 Art. 27.54. EXCEPTION; SERIOUS INJURY. A covered person may
12-6 be held liable for noneconomic loss if the injured person has
12-7 suffered a bodily injury that results in:
12-8 (1) death;
12-9 (2) dismemberment;
12-10 (3) permanent and serious disfigurement;
12-11 (4) a fracture;
12-12 (5) loss of a fetus;
12-13 (6) permanent loss of the use of a body organ, member,
12-14 function, or system;
12-15 (7) permanent and significant limitation of use of a
12-16 body organ, member, function, or system; or
12-17 (8) a medically determined injury or impairment that
12-18 prevents the injured person from performing substantially all of
12-19 the material acts that constitute the person's usual and customary
12-20 activities for at least 90 days during the 180-day period beginning
12-21 on the date of the accident causing the injury or impairment.
12-22 Art. 27.55. EXCEPTION; CONDUCT OF TORTFEASOR. A covered
12-23 person may recover damages for bodily injury arising out of a motor
12-24 vehicle accident if the defendant caused the injury:
12-25 (1) intentionally;
12-26 (2) under the influence of:
12-27 (A) alcohol;
13-1 (B) a controlled substance, as defined by
13-2 Section 481.002, Health and Safety Code;
13-3 (C) a volatile chemical listed in Section
13-4 484.002, Health and Safety Code; or
13-5 (D) an abusable glue or aerosol paint, as
13-6 defined by Section 485.001, Health and Safety Code; or
13-7 (3) while committing a felony, seeking to evade lawful
13-8 apprehension by a law enforcement official, operating a motor
13-9 vehicle in a speed contest, or operating or occupying a motor
13-10 vehicle known by the person to be stolen.
13-11 Art. 27.56. LIEN ON RECOVERY; RIGHTS OF INSURER. (a) In an
13-12 action by or on behalf of a covered person, against a noncovered
13-13 person, in which damages for bodily injury arising out of a motor
13-14 vehicle accident, including a motorcycle accident, are recovered,
13-15 an insured that paid or is liable to pay benefits for the injury
13-16 has a lien against any recovery to the extent of first-party
13-17 benefits paid or payable by the insured to the covered person.
13-18 (b) A covered person may not settle an action for bodily
13-19 injury brought against a noncovered person unless:
13-20 (1) the insurer consents in writing;
13-21 (2) the settlement is approved by a court of competent
13-22 jurisdiction; or
13-23 (3) the amount of the settlement exceeds the amount of
13-24 first-party benefits paid or payable by an insurer.
13-25 (c) At any time within the limitations period fixed for an
13-26 action for personal injury under Section 16.003, Civil Practice and
13-27 Remedies Code, an insurer may bring an action for the amount of
14-1 first-party benefits paid or payable to a covered person against a
14-2 person who may be liable for the covered person's injury. An
14-3 insurer may not bring an action under this subsection if the
14-4 covered person has commenced an action against the person for the
14-5 injury. A covered person may bring a cause of action against any
14-6 person who may be liable for the covered person's injury, without
14-7 regard to whether an action has been brought by an insurer. In an
14-8 action brought by the covered person after an action has been
14-9 commenced by the insurer, the covered person's recovery for covered
14-10 economic loss shall be reduced by the amount of first-party
14-11 benefits recovered by the insurer.
14-12 Art. 27.57. PROOF IN CERTAIN ACTIONS. In an action to
14-13 recover the amount of economic loss that exceeds $50,000, or to
14-14 recover noneconomic loss, or both, the first $50,000 of economic
14-15 loss may be pleaded and proved to the extent it is relevant to the
14-16 action.
14-17 (Sections 27.58-27.70 reserved for expansion
14-18 SUBCHAPTER D. ARBITRATION OF DISPUTES
14-19 Art. 27.71. RIGHT TO ELECT ARBITRATION. A policy of motor
14-20 vehicle insurance must authorize the claimant to elect arbitration
14-21 of a dispute involving the insurer's liability to pay first-party
14-22 benefits or additional first-party benefits, the amount of the
14-23 benefits, or a matter that arises under Article 21.55 of this code.
14-24 Art. 27.72. SETTLEMENT BETWEEN INSURERS. (a) This article
14-25 applies only to payment of first-party benefits for injury that
14-26 arises out of a motor vehicle accident involving at least one motor
14-27 vehicle that:
15-1 (1) weighs more than 6,500 pounds unloaded; or
15-2 (2) is used primarily for the transportation of
15-3 persons or property for hire.
15-4 (b) For the purposes of this article, the weight of a motor
15-5 vehicle is the actual weight of the vehicle fully equipped with
15-6 body and other equipment, as certified by an official public
15-7 weigher or a license and weight inspector of the Texas Department
15-8 of Public Safety.
15-9 (c) Except as provided by Subsection (d) of this article, an
15-10 insurer liable for the payment of first-party benefits, as
15-11 described by Subsection (a) of this article, to or on behalf of a
15-12 covered person, may recover from the insurer of another covered
15-13 person to the extent that the other covered person would be liable
15-14 if Subchapter C of this chapter did not bar recovery from the
15-15 covered person.
15-16 (d) An insurer who pays first-party benefits under Article
15-17 27.22 of this code to the occupants of a bus, other than the
15-18 operator or owner of the bus or employees of the operator or owner,
15-19 does not have a right to recover the amount of those benefits from
15-20 the insurer of the bus.
15-21 (e) An insurer seeking to recover on a disputed claim
15-22 arising under Subsection (c) of this article shall submit the
15-23 controversy to arbitration.
15-24 (f) The liability of an insurer imposed by this article does
15-25 not affect or diminish that insurer's obligations under a policy of
15-26 bodily injury liability insurance.
15-27 Art. 27.73. ARBITRATION OF DISPUTES BETWEEN INSURERS. A
16-1 dispute between insurers concerning their respective
16-2 responsibilities for payment of first-party benefits shall be
16-3 submitted to arbitration.
16-4 Art. 27.74. ARBITRATION. (a) Arbitration under Article
16-5 27.71, 27.72, or 27.73 of this code shall be conducted under rules
16-6 adopted by the commissioner.
16-7 (b) An award entered in arbitration under this article is
16-8 final and binding on all parties. Except as provided by Subsection
16-9 (c) of this article, a party to arbitration may not appeal the
16-10 award.
16-11 (c) A suit to vacate an arbitrator's award must be filed not
16-12 later than the earlier of:
16-13 (1) the first anniversary of the arbitrator's award;
16-14 or
16-15 (2) the later of:
16-16 (A) the 30th day after the date of the award; or
16-17 (B) the 30th day after the date the appealing
16-18 party knew or should have known of a basis for suit under this
16-19 article.
16-20 (d) Venue for a suit to vacate an arbitrator's award is in
16-21 the county in which arbitration was conducted or where the accident
16-22 occurred.
16-23 (e) In an appeal, the court is confined to the record
16-24 developed before the arbitrator and may vacate the arbitrator's
16-25 award only on a finding that:
16-26 (1) the award was obtained by corruption, fraud, or
16-27 misrepresentation;
17-1 (2) the decision of the arbitrator was arbitrary and
17-2 capricious; or
17-3 (3) the decision of the arbitrator was not based on
17-4 substantial evidence.
17-5 SECTION 2. Articles 5.01(b) and (e), Insurance Code, are
17-6 amended to read as follows:
17-7 (b) The Board shall have the sole and exclusive power and
17-8 authority, and it shall be its duty to determine, fix, prescribe,
17-9 and promulgate just, reasonable and adequate rates of premiums to
17-10 be charged and collected by all insurers writing any form of
17-11 insurance on motor vehicles in this State, including insurance
17-12 providing coverage under Chapter 27 of this code, fleet or other
17-13 rating plans designed to discourage losses from fire and theft and
17-14 similar hazards, and any rating plans designed to encourage the
17-15 prevention of accidents. In promulgating any such rating plans the
17-16 Board shall give due consideration to the peculiar hazards and
17-17 experience of individual risks, past and prospective, within and
17-18 outside the State and to all other relevant factors, within and
17-19 outside the State. The Board shall have the authority also to
17-20 alter or amend any and all of such rates of premiums so fixed and
17-21 determined and adopted by it, and to raise or lower the same or any
17-22 part thereof.
17-23 (e) Motor vehicle or automobile insurance as referred to in
17-24 this subchapter shall be taken and construed to mean insurance
17-25 providing coverage under Chapter 27 of this code and every form of
17-26 insurance on any automobile or other vehicle hereinafter enumerated
17-27 and its operating equipment or necessitated by reason of the
18-1 liability imposed by law for damages arising out of the ownership,
18-2 operation, maintenance, or use in this State of any automobile,
18-3 motorcycle, motorbicycle, truck, truck-tractor, tractor, traction
18-4 engine, or any other self-propelled vehicle, and including also
18-5 every vehicle, trailer or semi-trailer pulled or towed by a motor
18-6 vehicle, but excluding every motor vehicle running only upon fixed
18-7 rails or tracks. Workers' Compensation Insurance is excluded from
18-8 the foregoing definition.
18-9 SECTION 3. Section 5.01B(a), Insurance Code, is amended to
18-10 read as follows:
18-11 (a) Information filed or otherwise provided by an insurer to
18-12 the State Board of Insurance for the purpose of determining,
18-13 fixing, prescribing, promulgating, altering, or amending commercial
18-14 automobile <liability> insurance rates under Article 5.01 of this
18-15 code, obtaining a rate deviation under Article 5.03 of this code,
18-16 or reporting losses under Article 5.04-1 of this code is public
18-17 information unless it is exempt under Subchapter C, Chapter 552,
18-18 Government Code <Section 3(a), Chapter 424, Acts of the 63rd
18-19 Legislature, Regular Session, 1973 (Article 6252-17a, Vernon's
18-20 Texas Civil Statutes)>, or Section (b) of this article.
18-21 SECTION 4. Section 5.06-4(a), Insurance Code, is amended to
18-22 read as follows:
18-23 (a) Any insurer desiring to write commercial automobile
18-24 <liability> insurance in this state must provide loss control
18-25 information as a prerequisite for a license to write that
18-26 insurance.
18-27 SECTION 5. Article 5.06-6, Insurance Code, is amended to
19-1 read as follows:
19-2 Art. 5.06-6. COVERAGES FOR SPOUSES AND FORMER SPOUSES. A
19-3 personal automobile policy or any similar policy form adopted or
19-4 approved by the State Board of Insurance under Article 5.06 of this
19-5 code that provides coverage for an injury <covers liability>
19-6 arising out of ownership, maintenance, or use of a motor vehicle of
19-7 a spouse, who is otherwise insured by the policy, shall contain a
19-8 provision to continue coverage for the spouse during a period of
19-9 separation in contemplation of divorce.
19-10 SECTION 6. Section 1(a), Article 5.101, Insurance Code, is
19-11 amended to read as follows:
19-12 (a) The pilot program on flexible rating is created to help
19-13 stabilize the rates charged for insurance in all lines of <property
19-14 and casualty> insurance covered by Subchapters A through L of this
19-15 chapter, except ocean marine insurance, inland marine insurance,
19-16 fidelity, surety and guaranty bond insurance, errors and omissions
19-17 insurance, directors' and officers' liability insurance, general
19-18 liability insurance, commercial property insurance, workers'
19-19 compensation insurance, professional liability insurance for
19-20 physicians and health care providers as defined in Article 5.15-1
19-21 of this code, and attorney's professional liability insurance.
19-22 SECTION 7. Section 1(2), Article 21.81, Insurance Code, is
19-23 amended to read as follows:
19-24 (2) "Authorized insurer" means any insurer authorized
19-25 by the Texas Department of Insurance to write motor vehicle
19-26 insurance <liability> coverage under the provisions of Chapter 5 of
19-27 this code. The term does not include an insurer organized under
20-1 Chapter 17 of this code.
20-2 SECTION 8. Section 2(a), Article 21.81, Insurance Code, is
20-3 amended to read as follows:
20-4 (a) The Texas Automobile Insurance Plan Association is
20-5 established. The association is a nonprofit corporate body
20-6 composed of all authorized insurers. Each authorized insurer shall
20-7 be a member of the association and shall remain a member of the
20-8 association so long as the association is in existence as a
20-9 condition of its authority to write motor vehicle <liability>
20-10 insurance in this state.
20-11 SECTION 9. Sections 3(a) and (f), Article 21.81, Insurance
20-12 Code, are amended to read as follows:
20-13 (a) The governing committee has the responsibility for the
20-14 administration of the association through the plan of operation.
20-15 The association may collect funds from the member companies to
20-16 provide for the operation of the association. Assessments must be
20-17 made upon member companies in proportion to their writings of motor
20-18 vehicle <liability> insurance in this state. If an assessment made
20-19 upon a member insurer is not paid within a reasonable time, the
20-20 association may bring an action to collect the assessment. In
20-21 addition, the association may report the failure to pay to the
20-22 commissioner, who may institute a disciplinary action under Article
20-23 1.10 of this code. The association has the powers granted to
20-24 nonprofit corporations under the Texas Non-Profit Corporation Act
20-25 (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
20-26 (f) The plan of operation must include a voluntary,
20-27 competitive limited assignment distribution plan that allows
21-1 members to contract directly with a servicing carrier to accept
21-2 assignments to that carrier by the association. A servicing
21-3 carrier must be an insurance company licensed to write automobile
21-4 insurance in this state and is qualified if it has written
21-5 automobile <liability> insurance in Texas for at least five years
21-6 or is currently engaged as a servicing carrier for assigned risk
21-7 automobile business in at least one other state. After notice and
21-8 hearing, the commissioner may prohibit an insurer from acting as a
21-9 servicing carrier. The terms of the contract between the servicing
21-10 carrier and the insurer, including the buy-out fee, shall be
21-11 determined by negotiation between the parties. The governing
21-12 committee may adopt reasonable rules for the conduct of business
21-13 under the contract and may establish reasonable standards of
21-14 eligibility for servicing carriers.
21-15 SECTION 10. Section 4(c), Article 21.81, Insurance Code, is
21-16 amended to read as follows:
21-17 (c) A person who obtains, from any source, excess private
21-18 passenger automobile <auto liability> insurance coverage over the
21-19 minimum automobile <auto liability> coverage required by law shall
21-20 be ineligible for insurance through the association. The coverage
21-21 for the excess and basic limits policies is not affected by a
21-22 violation of this section unless the insurer shows that the insured
21-23 had actual knowledge that they were ineligible for coverage through
21-24 the association. An agent may not knowingly write excess private
21-25 passenger automobile <auto liability> insurance coverage if the
21-26 minimum automobile <auto liability> coverage required by law is
21-27 provided through the association. If an agent violates this
22-1 section, the agent, after notice and hearing, is subject to the
22-2 penalties provided by Section 7, Article 1.10, of this code.
22-3 SECTION 11. Section 1, Texas Motor Vehicle
22-4 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
22-5 Statutes), is amended to read as follows:
22-6 Sec. 1. The following words and phrases, when used in this
22-7 Act, shall, for the purposes of this Act, have the meanings
22-8 respectively ascribed to them in this section, except in those
22-9 instances where the context clearly indicates a different meaning:
22-10 1. "Highway" means the entire width between property
22-11 lines of any road, street, way, thoroughfare, or bridge in the
22-12 State of Texas not privately owned or controlled, when any part
22-13 thereof is open to the public for vehicular traffic and over which
22-14 the State has legislative jurisdiction under its police power.
22-15 2. "Judgment"--Any judgment which shall have become
22-16 final by expiration without appeal of the time within which an
22-17 appeal might have been perfected, or by final affirmation on
22-18 appeal, rendered by a court of competent jurisdiction of any state
22-19 or of the United States, upon a cause of action arising out of the
22-20 ownership, maintenance or use of any motor vehicle, for damages,
22-21 including damages for care and loss of services, because of bodily
22-22 injury to or death of any person, or for damages because of injury
22-23 to or destruction of property, including the loss of use thereof,
22-24 or upon a cause of action on an agreement of settlement for such
22-25 damages.
22-26 3. "Motor Vehicle"--Every self-propelled vehicle which
22-27 is designed for use upon a highway, including trailers and
23-1 semitrailers designed for use with such vehicles (except traction
23-2 engines, road rollers and graders, tractor cranes, power shovels,
23-3 well drillers and implements of husbandry) and every vehicle which
23-4 is propelled by electric power obtained from overhead wires but not
23-5 operated upon rails.
23-6 4. "License"--Any driver's, operator's, commercial
23-7 operator's, or chauffeur's license, temporary instruction permit or
23-8 temporary license, or restricted license, issued under Article
23-9 6687b, Texas Revised Civil Statutes, pertaining to the licensing of
23-10 persons to operate motor vehicles.
23-11 5. "Nonresident"--Every person who is not a resident
23-12 of the State of Texas.
23-13 6. "Nonresident's Operating Privilege"--The privilege
23-14 conferred upon a nonresident by the laws of Texas pertaining to the
23-15 operation by him of a motor vehicle, or the use of a motor vehicle
23-16 owned by him, in the State of Texas.
23-17 7. "Operator"--Every person who is in actual physical
23-18 control of a motor vehicle.
23-19 8. "Owner"--A person who holds the legal title of a
23-20 motor vehicle, or in the event a motor vehicle is the subject of an
23-21 agreement for the conditional sale or lease thereof with the right
23-22 of purchase upon performance of the conditions stated in the
23-23 agreement and with an immediate right of possession vested in the
23-24 conditional vendee or lessee or in the event a mortgagor of a
23-25 vehicle is entitled to possession, then such conditional vendee or
23-26 lessee or mortgagor shall be deemed the owner for the purposes of
23-27 this Act.
24-1 9. "Person"--Every natural person, firm,
24-2 copartnership, association or corporation.
24-3 10. "Proof of Financial Responsibility" means evidence
24-4 of compliance with or exemption from Section 1A of this Act and
24-5 includes any document that may be furnished to a peace officer or
24-6 person involved in an accident in compliance with Section 1B of
24-7 this Act. <Proof of ability to respond in damages for liability,
24-8 on account of accidents occurring subsequent to the effective date
24-9 of said proof, arising out of the ownership, maintenance or use of
24-10 a motor vehicle, in the following amounts: effective January 1,
24-11 1984, Fifteen Thousand Dollars ($15,000) because of bodily injury
24-12 to or death of one person in any one accident, and, subject to said
24-13 limit for one person, Thirty Thousand Dollars ($30,000) because of
24-14 bodily injury to or death of two (2) or more persons in any one
24-15 accident, and Fifteen Thousand Dollars ($15,000) because of injury
24-16 to or destruction of property of others in any one accident and
24-17 effective January 1, 1986, Twenty Thousand Dollars ($20,000)
24-18 because of bodily injury to or death of one person in any one
24-19 accident, and, subject to said limit for one person, Forty Thousand
24-20 Dollars ($40,000) because of bodily injury to or death of two (2)
24-21 or more persons in any one accident, and Fifteen Thousand Dollars
24-22 ($15,000) because of injury to or destruction of property of others
24-23 in any one accident. The proof of ability to respond in damages
24-24 may exclude the first Two Hundred Fifty Dollars ($250) of liability
24-25 for bodily injury to or death of any one person in any one
24-26 accident, and, subject to that exclusion for one person, may
24-27 exclude the first Five Hundred Dollars ($500) of liability for the
25-1 bodily injury to or death of two (2) or more persons in any one
25-2 accident and may exclude the first Two Hundred Fifty Dollars ($250)
25-3 of liability for the injury to or destruction of property of others
25-4 in any one accident.>
25-5 11. "Registration"--Registration or license
25-6 certificate or license receipt or dealer's license and registration
25-7 or number plates issued under Article 6675a or Article 6686, Texas
25-8 Revised Civil Statutes, pertaining to the registration of motor
25-9 vehicles.
25-10 12. "Department" means the Department of Public Safety
25-11 of the State of Texas, acting directly or through its authorized
25-12 officers and agents, except in such sections of this Act in which
25-13 some other State Department is specifically named.
25-14 13. "State"--Any state, territory or possession of the
25-15 United States, the District of Columbia, or any province of the
25-16 Dominion of Canada.
25-17 14. "Volunteer Fire Department" means a company,
25-18 department, or association whose members receive no or nominal
25-19 compensation and that is organized in an unincorporated area for
25-20 the purpose of answering fire alarms and extinguishing fires or
25-21 answering fire alarms, extinguishing fires, and providing emergency
25-22 medical services.
25-23 15. "Motorcycle" means each motor vehicle that has a
25-24 saddle for the use of the rider and is designed to propel itself
25-25 with not more than three wheels in contact with the ground, but
25-26 does not include a tractor or any three-wheeled vehicle equipped
25-27 with a cab, seat, and seat belt and designed to contain the
26-1 operator of the vehicle in the cab.
26-2 SECTION 12. Sections 1A(a), (b), and (d), Texas Motor
26-3 Vehicle Safety-Responsibility Act (Article 6701h, Vernon's Texas
26-4 Civil Statutes), are amended to read as follows:
26-5 (a) On and after January 1, 1982, no motor vehicle may be
26-6 operated in this State unless a policy of motor vehicle <automobile
26-7 liability> insurance that complies with Section 1A-1 of <in at
26-8 least the minimum amounts to provide evidence of financial
26-9 responsibility under> this Act is in effect to insure against
26-10 potential losses which may arise out of the operation of that
26-11 vehicle.
26-12 (b) The following vehicles are exempt from the requirement
26-13 of Subsection (a) of this section:
26-14 (1) vehicles exempt by Section 33 of this Act;
26-15 (2) any vehicles for which the title is held in the
26-16 name of a volunteer fire department;
26-17 (3) <vehicles for which a bond is on file with the
26-18 Department as provided by Section 24 of this Act, or for which a
26-19 certificate has been obtained from the State Treasurer stating that
26-20 the owner and/or operator has deposited with the State Treasurer
26-21 Fifty-Five Thousand Dollars ($55,000) in cash or securities as
26-22 provided by Section 25 of this Act. Such bond or deposit may be
26-23 filed in lieu of carrying automobile liability insurance where
26-24 proof is required;>
26-25 <(4)> vehicles that are self-insured under Section 34
26-26 of this Act; and
26-27 (4) <(5)> implements of husbandry<; and>
27-1 <(6) vehicles for which a valid certificate certifying
27-2 that cash or a cashier's check in the amount of at least Fifty-Five
27-3 Thousand Dollars ($55,000) is deposited with the county judge of
27-4 the county in which the vehicle is registered has been:>
27-5 <(A) issued by the county judge and acknowledged
27-6 by the sheriff of that county; and>
27-7 <(B) filed with the Department>.
27-8 (d) Subsection (b) of this section may not be construed to
27-9 exempt a person who is operating a vehicle for which title is held
27-10 in the name of a volunteer fire department from the <liability>
27-11 insurance requirements of this Act.
27-12 SECTION 13. The Texas Motor Vehicle Safety-Responsibility
27-13 Act (Article 6701h, Vernon's Texas Civil Statutes) is amended by
27-14 adding Section 1A-1 to read as follows:
27-15 Sec. 1A-1. REQUIRED COVERAGE. (a) The owner or operator of
27-16 a motor vehicle, other than a motorcycle, may satisfy the financial
27-17 responsibility requirement of this Act with a motor vehicle
27-18 insurance policy providing at least the minimum coverage required
27-19 by Article 27.11, Insurance Code.
27-20 (b) The owner or operator of a motorcycle may satisfy the
27-21 financial responsibility requirement of this Act with a motor
27-22 vehicle insurance policy that provides:
27-23 (1) the minimum coverage required by Article 27.12,
27-24 Insurance Code; and
27-25 (2) coverage for the liability of the owner or
27-26 operator for damages arising out of the use of the motor vehicle in
27-27 the amount of:
28-1 (A) $20,000 for bodily injury to or death of one
28-2 person in one accident;
28-3 (B) $40,000 for bodily injury to or death of two
28-4 or more persons in one accident, subject to the amount provided by
28-5 Paragraph (A) for bodily injury to or death of one of the persons;
28-6 and
28-7 (C) $15,000 for damage to or destruction of
28-8 property of others in one accident.
28-9 SECTION 14. Section 1B(a), Texas Motor Vehicle
28-10 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
28-11 Statutes), is amended to read as follows:
28-12 (a) As a condition of operating a motor vehicle in this
28-13 state, the operator of the motor vehicle shall furnish, on request
28-14 of a peace officer or a person involved in an accident with the
28-15 operator:
28-16 (1) an <a liability> insurance policy that complies
28-17 with Section 1A-1 of <in at least the minimum amounts required by>
28-18 this Act, or a photocopy of that policy, that covers the vehicle;
28-19 (2) a standard proof of <liability> insurance form
28-20 promulgated by the Texas Department of Insurance and issued by an
28-21 <a liability> insurer that:
28-22 (A) includes the name of the insurer;
28-23 (B) includes the insurance policy number;
28-24 (C) includes the policy period;
28-25 (D) includes the name and address of each
28-26 insured;
28-27 (E) includes the policy limits or a statement
29-1 that the coverage of the policy complies with Section 1A-1 of <at
29-2 least the minimum amounts of liability insurance required by> this
29-3 Act; and
29-4 (F) includes the make and model of each covered
29-5 vehicle;
29-6 (3) an insurance binder that confirms that the
29-7 operator is in compliance with this Act; or
29-8 (4) a certificate or copy of a certificate issued by
29-9 the department that shows the vehicle is covered by
29-10 self-insurance<;>
29-11 <(5) a certificate issued by the state treasurer that
29-12 shows that the owner of the vehicle has on deposit with the
29-13 treasurer money or securities in at least the amount required by
29-14 Section 25 of this Act;>
29-15 <(6) a certificate issued by the department that shows
29-16 that the vehicle is a vehicle for which a bond is on file with the
29-17 department as provided by Section 24 of this Act; or>
29-18 <(7) a copy of a certificate issued by the county
29-19 judge of a county in which the vehicle is registered that shows
29-20 that the owner of the vehicle has on deposit with the county judge
29-21 cash or a cashier's check in at least the amount required by
29-22 Section 1A(b)(6) of this Act>.
29-23 SECTION 15. Sections 1D and 1E, Texas Motor Vehicle
29-24 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
29-25 Statutes), are amended to read as follows:
29-26 Sec. 1D. It is a defense to prosecution under this Act if
29-27 the person charged produces in court an <automobile liability>
30-1 insurance policy that complies with Section 1A-1 of this Act or a
30-2 certificate of self-insurance previously issued to that person that
30-3 was valid at the time that the offense is alleged to have occurred
30-4 and the charge shall be dismissed.
30-5 Sec. 1E. When notified of an accident by the Department in
30-6 which an owner or operator has reported evidence of financial
30-7 responsibility with an insurance company, the insurance company so
30-8 notified shall be required to respond to the Department only if
30-9 there is not a policy of <liability> insurance that complies with
30-10 Section 1A-1 of this Act in effect, as reported.
30-11 SECTION 16. Sections 1F(a) and (f), Texas Motor Vehicle
30-12 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
30-13 Statutes), are amended to read as follows:
30-14 (a) The department shall suspend the driver's license and
30-15 motor vehicle registration of a person convicted of an offense
30-16 under Section 1C(a) of this Act, if a prior conviction of the
30-17 person under Section 1C(a) of this Act has been previously reported
30-18 to the department by a magistrate or the judge or clerk of a court,
30-19 unless the person establishes and maintains proof of financial
30-20 responsibility for two years from the date of the second or
30-21 subsequent conviction. The requirement for filing proof of
30-22 financial responsibility may be waived if satisfactory evidence is
30-23 filed with the Department that the party convicted was at the time
30-24 of arrest covered by a policy of <liability> insurance that
30-25 complies with Section 1A-1 of this Act or was otherwise exempt as
30-26 provided in Section <Sec.> 1A(b) of this Act.
30-27 (f) The following evidence of financial responsibility or a
31-1 photocopy of the evidence satisfies the requirement of Subsection
31-2 (e) of this section:
31-3 (1) an <a liability> insurance policy that complies
31-4 with Section 1A-1 of <in at least the minimum amounts required by>
31-5 this Act to provide proof of financial responsibility covering at
31-6 least the period required by Subsection (e) of this section;
31-7 (2) a standard proof of <liability> insurance form
31-8 promulgated by the Texas Department of Insurance and issued by an
31-9 <a liability> insurer that includes:
31-10 (A) the name of the insurer;
31-11 (B) the insurance policy number;
31-12 (C) the policy period, which must equal or
31-13 exceed the period required by Subsection (e) of this section;
31-14 (D) the name and address of each insured; and
31-15 (E) the policy limits or a statement that the
31-16 coverage of the policy complies with Section 1A-1 of <at least the
31-17 minimum amounts of liability insurance required by> this Act;
31-18 (3) an insurance binder that confirms to the
31-19 satisfaction of the court that the defendant is in compliance with
31-20 this Act for at least the period required by Subsection (e) of this
31-21 section; or
31-22 (4) a copy of a certificate issued by the Department
31-23 of Public Safety that shows that the vehicle to be registered is
31-24 covered by self-insurance<;>
31-25 <(5) a certificate issued by the state treasurer that
31-26 shows that the owner of the vehicle has on deposit with the
31-27 treasurer money or securities in at least the amount required by
32-1 Section 25 of this Act;>
32-2 <(6) a certificate issued by the Department that shows
32-3 that the vehicle is a vehicle for which a bond is on file with the
32-4 Department as provided by Section 24 of this Act; or>
32-5 <(7) a copy of a certificate issued by the county
32-6 judge of a county in which the vehicle is registered that shows
32-7 that the owner of the vehicle has on deposit with the county judge
32-8 cash or a cashier's check in at least the amount required by
32-9 Section 1A(b)(6) of this Act>.
32-10 SECTION 17. Section 5(c), Texas Motor Vehicle
32-11 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
32-12 Statutes), is amended to read as follows:
32-13 (c) This section shall not apply under the conditions stated
32-14 in Section 6 nor:
32-15 1. To a motor vehicle operator or owner against whom
32-16 the Department or a person presiding at a hearing finds there is
32-17 not a reasonable probability of a judgment being rendered as a
32-18 result of the accident;
32-19 2. To such operator or owner if such owner had in
32-20 effect at the time of such accident a motor vehicle insurance
32-21 <liability> policy with respect to the motor vehicle involved in
32-22 such accident;
32-23 3. To such operator, if not the owner of such motor
32-24 vehicle, if there was in effect at the time of such accident a
32-25 motor vehicle insurance <liability> policy <or bond> with respect
32-26 to his operation of motor vehicles not owned by him;
32-27 4. To any person employed by the government of the
33-1 United States, when such person is acting within the scope or
33-2 office of his employment;
33-3 5. To such operator or owner if the liability of such
33-4 operator or owner for damages resulting from such accident is, in
33-5 the judgment of the Department, covered by any other form of
33-6 liability insurance policy or bond; nor
33-7 6. To any person qualifying as a self-insurer under
33-8 Section 34 of this Act, or to any person operating a motor vehicle
33-9 for such self-insurer.
33-10 No such policy or bond shall be effective under this section
33-11 or under Section 7 unless issued by an insurance company or surety
33-12 company authorized to write motor vehicle <liability> insurance in
33-13 this State, except that if such motor vehicle was not registered in
33-14 this State, or was a motor vehicle which was registered elsewhere
33-15 than in this State at the effective date of the policy, or the most
33-16 recent renewal thereof, such policy or bond shall not be effective
33-17 under this section unless the insurance company or surety company
33-18 if not authorized to do business in this State shall execute a
33-19 power of attorney authorizing the Department to accept service on
33-20 its behalf of notice or process in any action upon such policy or
33-21 bond arising out of such accident. The policy or bond must provide
33-22 coverage at least equivalent to that required under Section 1A-1 of
33-23 this Act<; providing, however, every such policy or bond is
33-24 subject, if the accident has resulted in bodily injury or death, to
33-25 a limit, exclusive of interest and costs, as follows: effective
33-26 January 1, 1984, not less than Fifteen Thousand Dollars ($15,000)
33-27 because of bodily injury to or death of one person in any one
34-1 accident and, subject to said limit for one person, to a limit of
34-2 not less than Thirty Thousand Dollars ($30,000) because of bodily
34-3 injury to or death of two (2) or more persons in any one accident,
34-4 and, if the accident has resulted in injury to or destruction of
34-5 property, to a limit of not less than Fifteen Thousand Dollars
34-6 ($15,000) because of injury to or destruction of property of others
34-7 in any one accident and effective January 1, 1986, not less than
34-8 Twenty Thousand Dollars ($20,000) because of bodily injury to or
34-9 death of one person in any one accident, and, subject to said limit
34-10 for one person, to a limit of not less than Forty Thousand Dollars
34-11 ($40,000) because of bodily injury to or death of two (2) or more
34-12 persons in any one accident, and, if the accident has resulted in
34-13 injury to or destruction of property, to a limit of not less than
34-14 Fifteen Thousand Dollars ($15,000) because of injury to or
34-15 destruction of property of others in any one accident. The policy
34-16 or bond may exclude coverage of the first Two Hundred Fifty Dollars
34-17 ($250) of liability for bodily injury to or death of any one person
34-18 in any one accident, and, subject to that exclusion for one person,
34-19 may exclude coverage for the first Five Hundred Dollars ($500) of
34-20 liability for the bodily injury to or death of two (2) or more
34-21 persons in any one accident and may exclude coverage for the first
34-22 Two Hundred Fifty Dollars ($250) of liability for the injury to or
34-23 destruction of property of others in any one accident>.
34-24 7. Wherever the word "bond" appears in this section or
34-25 this Act, it shall mean a bond filed with and approved by the
34-26 Department of Public Safety.
34-27 SECTION 18. Section 8(c), Texas Motor Vehicle
35-1 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
35-2 Statutes), is amended to read as follows:
35-3 (c) Upon receipt of certification by the Department that the
35-4 operating privilege of a Texas resident has been suspended or
35-5 revoked in another state pursuant to a law providing for its
35-6 suspension or revocation for failure to deposit security for the
35-7 payment of judgments arising out of a motor vehicle accident, for
35-8 failure to satisfy any judgment, or for failure to file proof of
35-9 financial responsibility, the Department shall contact the official
35-10 who issued the certification and request information pertaining to
35-11 the specific nature of the Texas resident's noncompliance. If the
35-12 alleged noncompliance is based on the failure of the Texas
35-13 resident's insurance company or surety company to obtain
35-14 authorization to write motor vehicle <liability> insurance in the
35-15 other state and for failure of the insurance or surety company to
35-16 execute a power of attorney directing the appropriate official in
35-17 the other state to accept service on its behalf of notice or
35-18 process in any action upon the policy arising out of the accident,
35-19 then the Department shall not suspend the Texas resident's license
35-20 and other registrations. If the evidence shows that the Texas
35-21 resident's operating privilege was suspended in the other state for
35-22 any other violation of another state's laws providing for
35-23 suspension or revocation for failure to deposit security for the
35-24 payment of judgments arising out of motor vehicle accidents, for
35-25 failure to satisfy any judgment, or for failure to file proof of
35-26 financial responsibility, under circumstances that would require
35-27 the Department to suspend a nonresident's operating privilege had
36-1 the accident occurred in this state, then the Department shall
36-2 suspend the Texas resident's license and registrations. The
36-3 suspension shall continue until the resident furnishes evidence of
36-4 his compliance with the law of the other state relating to the
36-5 deposit of security, satisfaction of judgment, or proof of
36-6 financial responsibility.
36-7 SECTION 19. Section 13(c), Texas Motor Vehicle
36-8 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
36-9 Statutes), is amended to read as follows:
36-10 (c) Notwithstanding any other provision of this Act any
36-11 person whose license, registration or nonresident's operating
36-12 privilege has been suspended, or is about to be suspended or shall
36-13 become subject to suspension under this Article, may relieve
36-14 himself from the effect of the judgment by filing with the
36-15 Department satisfactory evidence that there was in effect at the
36-16 time of the accident out of which the judgment arose a policy of
36-17 <liability> insurance covering the operation of the motor vehicle
36-18 involved and filing with the Department an affidavit stating that
36-19 at the time of the accident upon which the judgment has been
36-20 rendered he was insured, that the insurer is liable to pay such
36-21 judgment, and the reason, if known, why the insurance company has
36-22 not paid the judgment. He shall also file the original policy of
36-23 insurance or a certified copy thereof, if available, and such other
36-24 documents as the Department may require to show that the loss,
36-25 injury, or damage for which the judgment was rendered, was covered
36-26 by the policy of insurance.
36-27 If the Department is satisfied from such papers that the
37-1 insurer was authorized to issue the policy of insurance in this
37-2 State at the time of issuing the policy and that such insurer is
37-3 liable to pay such judgment, at least to the extent and for the
37-4 amounts provided in this Article, the Department shall not suspend
37-5 the license, registration or nonresident's operating privilege, or
37-6 if already suspended, shall reinstate them.
37-7 Any person whose license, registration or nonresident's
37-8 operating privilege has heretofore been suspended under the
37-9 provisions of this Article may take advantage of this Section.
37-10 SECTION 20. Section 15, Texas Motor Vehicle
37-11 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
37-12 Statutes), is amended to read as follows:
37-13 Sec. 15. Judgments herein referred to shall, for the purpose
37-14 of this Act only, be deemed satisfied:
37-15 1. When $20,000 <the amount set out in Subdivision (6)
37-16 of Subsection (c) of Section 5 of this Act for bodily injury to or
37-17 death of one person in any one accident> has been credited upon any
37-18 judgment or judgments rendered in excess of that amount because of
37-19 bodily injury to or death of one person as the result of any one
37-20 accident;
37-21 2. When $40,000<, subject to the limit set out in
37-22 Subdivision (6) of Subsection (c) of Section 5 of this Act because
37-23 of bodily injury to or death of one person, the sum set out in
37-24 Subdivision (6) of Subsection (c) of Section 5 of this Act for
37-25 bodily injury to or death of two (2) or more persons in any one
37-26 accident> has been credited upon any judgment or judgments rendered
37-27 in excess of that amount because of bodily injury to or death of
38-1 two (2) or more persons as the result of any one accident, subject
38-2 to a limit of $20,000 for any one person in the accident; or
38-3 3. When $15,000 <the sum set out in Subdivision (6) of
38-4 Subsection (c) of Section 5 of this Act for injury to or
38-5 destruction of property of others in any one accident> has been
38-6 credited upon any judgment or judgments rendered in excess of that
38-7 amount because of injury to or destruction of property of others as
38-8 a result of any one accident;
38-9 Provided, however, payments made in settlement of any claims
38-10 because of bodily injury, death or property damage arising from a
38-11 motor vehicle accident shall be credited in reduction of the
38-12 amounts provided for in this Section.
38-13 SECTION 21. Section 20(a), Texas Motor Vehicle
38-14 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
38-15 Statutes), is amended to read as follows:
38-16 (a) The non-resident owner or operator of a motor vehicle
38-17 not registered in this State may give proof of financial
38-18 responsibility by filing with the Department a certificate or
38-19 certificates of an insurance company authorized to transact
38-20 business in the state in which the motor vehicle or motor vehicles
38-21 covered in such certificate are registered, or if such non-resident
38-22 does not own a motor vehicle, then in the state in which the
38-23 insured resides, provided such certificate otherwise conforms to
38-24 the provisions of this Act, and the Department shall accept the
38-25 same upon condition that said insurance company complies with the
38-26 following provisions with respect to the policies so certified:
38-27 1. Said insurance company shall execute a power of
39-1 attorney authorizing the Department to accept service on its behalf
39-2 of notice or process in any action arising out of a motor vehicle
39-3 accident in this State; and
39-4 2. Said insurance company shall agree in writing that
39-5 such policies shall be deemed to conform with the laws of this
39-6 State relating to the terms of motor vehicle insurance <liability>
39-7 policies issued herein.
39-8 SECTION 22. Section 21, Texas Motor Vehicle
39-9 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
39-10 Statutes), is amended to read as follows:
39-11 Sec. 21. MOTORCYCLE <MOTOR VEHICLE> LIABILITY POLICY
39-12 DEFINED. (a) A "motorcycle <motor vehicle> liability policy" as
39-13 said term is used in this Act shall mean an owner's or an
39-14 operator's policy of liability insurance, certified as provided in
39-15 Section 19 or Section 20 as proof of financial responsibility, and
39-16 issued, except as otherwise provided in Section 20, by an insurance
39-17 company duly authorized to write motor vehicle liability insurance
39-18 in this State, to or for the benefit of the person named therein as
39-19 insured.
39-20 (b) Such owner's policy of liability insurance:
39-21 1. Shall cover each motorcycle <all motor vehicles>
39-22 with respect to which coverage is thereby to be granted; and
39-23 2. Shall pay on behalf of the insured named therein
39-24 and any other person, as insured, using a covered motorcycle <any
39-25 such motor vehicle or motor vehicles> with the express or implied
39-26 permission of such named insured, all sums which the insured shall
39-27 become legally obligated to pay as damages arising out of the
40-1 ownership, maintenance or use of the motorcycle <such motor vehicle
40-2 or motor vehicles> within the United States of America or the
40-3 Dominion of Canada, subject to limits exclusive of interest and
40-4 costs, for each motorcycle <with respect to each such motor
40-5 vehicle>, as set out in <Subdivision (6) of Subsection (c) of>
40-6 Section 1A-1 <5> of this Act. The policy may exclude coverage of
40-7 the first Two Hundred Fifty Dollars ($250) of liability for bodily
40-8 injury to or death of any one person in any one accident, and,
40-9 subject to that exclusion for one person, may exclude coverage for
40-10 the first Five Hundred Dollars ($500) of liability for the bodily
40-11 injury to or death of two (2) or more persons in any one accident
40-12 and may exclude coverage for the first Two Hundred Fifty Dollars
40-13 ($250) of liability for the injury to or destruction of property of
40-14 others in any one accident.
40-15 (c) Such operator's policy of liability insurance shall pay
40-16 on behalf of the insured named therein all sums which the insured
40-17 shall become legally obligated to pay as damages arising out of the
40-18 use by the insured <him> of a motorcycle <any motor vehicle> not
40-19 owned by the insured <him>, within the same territorial limits and
40-20 subject to the same limits of liability as are set forth above with
40-21 respect to an owner's policy of liability insurance.
40-22 (d) A motorcycle <Such motor vehicle> liability policy shall
40-23 state the name and address of the named insured, the coverage
40-24 afforded by the policy, the premium charged therefor, the policy
40-25 period and the limits of liability, and shall contain an agreement
40-26 or be endorsed that insurance is provided thereunder in accordance
40-27 with the coverage defined in this Act as respects bodily injury and
41-1 death or property damage, or both, and is subject to all the
41-2 provisions of this Act.
41-3 (e) A motorcycle <Such motor vehicle> liability policy shall
41-4 not insure:
41-5 1. Any obligation for which the insured or any company
41-6 as his insurer may be held liable under any workmen's compensation
41-7 law;
41-8 2. Any liability on account of bodily injury to or
41-9 death of any employee of the insured while engaged in the
41-10 employment, other than domestic, of the insured, or in domestic
41-11 employment if benefits therefor are either payable or required to
41-12 be provided under any workmen's compensation law; nor
41-13 3. Any liability because of injury to or destruction
41-14 of property owned by, rented to, in charge of or transported by the
41-15 insured.
41-16 (f) A motorcycle <Every motor vehicle> liability policy
41-17 shall be subject to the following provisions which need not be
41-18 contained therein:
41-19 1. The liability of the insurance company with respect
41-20 to the insurance required by this Act shall become absolute
41-21 whenever injury or damage covered by said <motor vehicle liability>
41-22 policy occurs; said policy may not be canceled or annulled as to
41-23 such liability by any agreement between the insurance company and
41-24 the insured after the occurrence of the injury or damage; no
41-25 statement made by the insured or on his behalf and no violation of
41-26 said policy shall defeat or void said policy;
41-27 2. The satisfaction by the insured of a judgment for
42-1 such injury or damage shall not be a condition precedent to the
42-2 right or duty of the insurance company to make payment on account
42-3 of such injury or damage;
42-4 3. The insurance company shall have the right to
42-5 settle any claim covered by the policy, and if such settlement is
42-6 made in good faith, the amount thereof shall be deductible from the
42-7 limits of liability specified in Subdivision 2 of Subsection (b) of
42-8 this Section;
42-9 4. The policy, the written application therefor, if
42-10 any, and any rider or endorsement which does not conflict with the
42-11 provisions of the Act shall constitute the entire contract between
42-12 the parties.
42-13 (g) Any policy which grants the coverage required for a
42-14 motorcycle <motor vehicle> liability policy may also grant any
42-15 lawful coverage in excess of or in addition to the coverage
42-16 specified for a motorcycle <motor vehicle> liability policy and
42-17 such excess or additional coverage shall not be subject to the
42-18 provisions of this Act. With respect to a policy which grants such
42-19 excess or additional coverage the term "motorcycle <motor vehicle>
42-20 liability policy" shall apply only to that part of the coverage
42-21 which is required by this Section.
42-22 (h) A motorcycle <Any motor vehicle> liability policy may
42-23 provide that the insured shall reimburse the insurance company for
42-24 any payment the insurance company would not have been obligated to
42-25 make under the terms of the policy except for the provisions of
42-26 this Act.
42-27 (i) A motorcycle <Any motor vehicle> liability policy may
43-1 provide for the prorating of the insurance thereunder with other
43-2 valid and collectible insurance.
43-3 (j) The requirements for a motorcycle <motor vehicle>
43-4 liability policy may be fulfilled by the policies of one (1) or
43-5 more insurance companies which policies together meet such
43-6 requirements.
43-7 (k) Any binder issued pending the issuance of a motorcycle
43-8 <motor vehicle> liability policy shall be deemed to fulfill the
43-9 requirements for such a policy.
43-10 SECTION 23. Section 29, Texas Motor Vehicle
43-11 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
43-12 Statutes), is amended to read as follows:
43-13 Sec. 29. DURATION OF PROOF--WHEN PROOF MAY BE CANCELLED <OR
43-14 RETURNED>. The Department shall upon request consent to the
43-15 immediate cancellation of any bond or certificate of insurance, <or
43-16 the Department shall direct and the State Treasurer shall return to
43-17 the person entitled thereto any money or securities deposited
43-18 pursuant to this Act as proof of financial responsibility,> or the
43-19 Department shall waive the requirement of filing proof, in any of
43-20 the following events:
43-21 1. At any time after two (2) years from the date such
43-22 proof was required when, during the two-year period preceding the
43-23 request, the Department has not received record of a conviction or
43-24 a forfeiture of bail which would require or permit the suspension
43-25 or revocation of the license, registration or nonresident's
43-26 operating privilege of the person by or for whom such proof was
43-27 furnished; or
44-1 2. In the event of the death of the person on whose
44-2 behalf such proof was filed or the permanent incapacity of such
44-3 person to operate a motor vehicle; or
44-4 3. In the event the person who has given proof
44-5 surrenders his license and registration to the Department. <;>
44-6 <Provided, however, that the Department shall not consent to
44-7 the cancellation of any bond or the return of any money or
44-8 securities in the event any action for damages upon a liability
44-9 covered by such proof is then pending or any judgment upon any such
44-10 liability is then unsatisfied, or in the event the person who has
44-11 filed such bond or deposited such money or securities has, within
44-12 two (2) years immediately preceding such request, been involved as
44-13 an operator or owner in any motor vehicle accident resulting in
44-14 injury or damage to the person or property of others. An affidavit
44-15 of the applicant as to the nonexistence of such facts, or that he
44-16 has been released from all of his liability, or has been finally
44-17 adjudicated not to be liable, for such injury or damage, shall be
44-18 sufficient evidence thereof in the absence of evidence to the
44-19 contrary in the records of the Department.>
44-20 Whenever any person whose proof has been cancelled <or
44-21 returned> under Subdivision 3 of this Section applies for a license
44-22 or registration within a period of two (2) years from the date
44-23 proof was originally required, any such application shall be
44-24 refused unless the applicant shall re-establish such proof for the
44-25 remainder of such two-year period.
44-26 SECTION 24. Sections 34(b) and (c), Texas Motor Vehicle
44-27 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
45-1 Statutes), are amended to read as follows:
45-2 (b) An applicant for a certificate of self-insurance shall
45-3 submit to the Department, in a form approved by the Department, an
45-4 undertaking binding the person to provide benefits for bodily
45-5 injury that meet the requirements of Chapter 27, Insurance Code.
45-6 The Department may, in its discretion, <upon the application of a
45-7 person,> issue a certificate of self-insurance when it is satisfied
45-8 that such person is possessed and will continue to be possessed of
45-9 ability to pay benefits meeting the requirements of Chapter 27,
45-10 Insurance Code, and judgments for destruction of or damage to
45-11 property obtained against such person.
45-12 (c) Upon not less than five (5) days notice and a hearing
45-13 pursuant to such notice, the Department may upon reasonable grounds
45-14 cancel a certificate of self-insurance. Failure to pay any
45-15 required benefit or judgment within thirty (30) days after the
45-16 injured person has supplied proof of loss or the <such> judgment is
45-17 <shall have become> final is <shall constitute> a reasonable ground
45-18 for the cancellation of a certificate of self-insurance.
45-19 SECTION 25. Sections 2a(d) and (e), Chapter 88, General
45-20 Laws, Acts of the 41st Legislature, 2nd Called Session, 1929
45-21 (Article 6675a-2a, Vernon's Texas Civil Statutes), are amended to
45-22 read as follows:
45-23 (d) The following evidence of financial responsibility or a
45-24 photocopy of the evidence satisfies the requirement of this
45-25 section:
45-26 (1) an <a liability> insurance policy or <liability>
45-27 self-insurance or pool coverage document issued by a political
46-1 subdivision or governmental pool pursuant to the authority
46-2 contained in Chapter 791, Government Code <The Interlocal
46-3 Cooperation Act (Article 4413(32c), Vernon's Texas Civil
46-4 Statutes)>, Chapter 119, Local Government Code, or other applicable
46-5 law in at least the minimum amounts required by the Texas Motor
46-6 Vehicle Safety-Responsibility Act (Article 6701h, Vernon's Texas
46-7 Civil Statutes) to provide proof of financial responsibility
46-8 covering at least the period required by Subsection (a) of this
46-9 section;
46-10 (2) a standard proof of insurance <liability> form
46-11 promulgated by the Texas Department of Insurance and issued by an
46-12 <a liability> insurer that includes:
46-13 (A) the name of the insurer;
46-14 (B) the insurance policy or other coverage
46-15 document number;
46-16 (C) the policy or other coverage document
46-17 coverage period;
46-18 (D) the name and address of each insured or
46-19 covered person;
46-20 (E) the policy or other coverage document limits
46-21 or a statement that the coverage of the policy complies with at
46-22 least the minimum amounts of <liability> insurance required by the
46-23 Texas Motor Vehicle Safety-Responsibility Act (Article 6701h,
46-24 Vernon's Texas Civil Statutes); and
46-25 (F) the make and model of each covered vehicle;
46-26 (3) an insurance binder that confirms to the
46-27 satisfaction of the county tax collector that the owner of the
47-1 motor vehicle to be registered is in compliance with the Texas
47-2 Motor Vehicle Safety-Responsibility Act (Article 6701h, Vernon's
47-3 Texas Civil Statutes) for at least the period required by
47-4 Subsection (a) of this section; or
47-5 (4) a copy of a certificate issued by the Department
47-6 of Public Safety that shows that the vehicle to be registered is
47-7 covered by self-insurance<;>
47-8 <(5) a certificate issued by the state treasurer that
47-9 shows that the owner of the vehicle has on deposit with the
47-10 treasurer money or securities in at least the amount required by
47-11 Section 25 of the Texas Motor Vehicle Safety-Responsibility Act
47-12 (Article 6701h, Vernon's Texas Civil Statutes);>
47-13 <(6) a certificate issued by the Department of Public
47-14 Safety that shows that the vehicle is a vehicle for which a bond is
47-15 on file with the Department as provided by Section 24 of the Texas
47-16 Motor Vehicle Safety-Responsibility Act (Article 6701h, Vernon's
47-17 Texas Civil Statutes); or>
47-18 <(7) a copy of a certificate issued by the county
47-19 judge of a county in which the vehicle is registered that shows
47-20 that the owner of the vehicle has on deposit with the county judge
47-21 cash or a cashier's check in at least the amount required by
47-22 Section 1A(b)(6) of the Texas Motor Vehicle Safety-Responsibility
47-23 Act (Article 6701h, Vernon's Texas Civil Statutes)>.
47-24 (e) At the time the county tax collector registers a motor
47-25 vehicle, the tax collector shall provide to the person registering
47-26 the motor vehicle a separate document that contains a statement
47-27 that the motor vehicle being registered may not be operated in this
48-1 state unless <liability> insurance coverage for the vehicle in at
48-2 least the minimum amounts required by law remains in effect <to
48-3 insure against potential losses> or unless the motor vehicle is
48-4 exempt from the insurance requirement by Section 1A(b), Texas Motor
48-5 Vehicle Safety-Responsibility Act (Article 6701h, Vernon's Texas
48-6 Civil Statutes).
48-7 SECTION 26. Section 6(c), Chapter 173, Acts of the 47th
48-8 Legislature, Regular Session, 1941 (Article 6687b, Vernon's Texas
48-9 Civil Statutes), is amended to read as follows:
48-10 (c) An application for an original or renewal driver's
48-11 license must be accompanied by evidence of financial responsibility
48-12 or a statement that the applicant does not own a motor vehicle for
48-13 which maintenance of financial responsibility is required under the
48-14 Texas Motor Vehicle Safety-Responsibility Act (Article 6701h,
48-15 Vernon's Texas Civil Statutes). Evidence of financial
48-16 responsibility presented under this subsection must comply with
48-17 Section 1A-1 <be in at least the minimum amounts required by
48-18 Subdivision 10, Section 1>, Texas Motor Vehicle
48-19 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
48-20 Statutes), must cover each motor vehicle that the applicant owns
48-21 and for which the applicant is required to maintain financial
48-22 responsibility, and may be shown in the manner specified under
48-23 Section 1B(a) of that Act. A personal automobile insurance policy
48-24 used as evidence of financial responsibility under this subsection
48-25 must be written for a term of 30 days or more as required by
48-26 Article 5.06, Insurance Code. A statement that the applicant does
48-27 not own an applicable motor vehicle must be sworn to and signed by
49-1 the applicant.
49-2 SECTION 27. (a) Section 11(a), Chapter 270, Acts of the
49-3 40th Legislature, Regular Session, 1927 (Article 911a, Vernon's
49-4 Texas Civil Statutes), as amended by Chapters 377 and 624, Acts of
49-5 the 70th Legislature, Regular Session, 1987, is amended to read as
49-6 follows:
49-7 (a) The Commission shall, in the granting of any certificate
49-8 to any motor bus company for regularly transporting persons as
49-9 passengers for compensation or hire, require the owner or operator
49-10 to first procure insurance covering bodily injury <liability> and
49-11 property damage <insurance> from a company holding a certificate of
49-12 authority to transact such kinds of insurance business in the State
49-13 of Texas or, with the approval of the Commission <Commissioner>, by
49-14 a surplus lines insurer meeting the requirements of Article 1.14-2,
49-15 Insurance Code, and rules adopted by the commissioner of insurance
49-16 <State Board of Insurance> under that article, covering each and
49-17 every motor propelled vehicle while actually being operated by such
49-18 applicant. The Commission shall adopt rules covering the coverage
49-19 limits and terms of the insurance policy, except that the coverage
49-20 provided under the policy must meet the requirements of Chapter 27,
49-21 Insurance Code. <The amount of such policy or policies of
49-22 insurance shall be fixed by the Commission by general order or
49-23 otherwise, and the terms and conditions of said policy or policies
49-24 covering said motor vehicle are to be such as to indemnify the
49-25 applicant against loss by reason of any personal injury to any
49-26 person or loss or damage to the property of any person other than
49-27 the assured and his employees.> Such policy or policies shall
50-1 furthermore provide that the insurer will pay benefits under the
50-2 policy and any judgment that <all judgements which> may be
50-3 recovered against the insured motor bus company based on claims for
50-4 loss or damage from personal injury or loss of or injury to
50-5 property occurring during the term of the said policy or policies
50-6 and arising out of the actual operation of such motor bus or
50-7 busses, and such policy or policies shall also provide for
50-8 successive recoveries to the complete exhaustion of the face amount
50-9 thereof, and that the benefits or <such> judgment will be paid by
50-10 the insurer irrespective of the solvency or insolvency of the
50-11 insured. Such <liability and property damage> insurance as
50-12 required by the Commission shall be continuously maintained in
50-13 force on each and every motor propelled vehicle while being
50-14 operated in common carrier service. In addition to the insurance
50-15 hereinabove set forth, the owner or operator shall also protect his
50-16 employees by taking out workmen's compensation insurance either as
50-17 provided by the Workmen's Compensation Laws of the State of Texas
50-18 or in a reliable insurance company approved by the Railroad
50-19 Commission of the State of Texas. The taking out of such indemnity
50-20 policy or policies shall be a condition precedent to any operation
50-21 and such policy or policies as required under this Act, shall be
50-22 approved and filed with the Commission and failure to file and keep
50-23 such policy or policies in force and effect as provided herein
50-24 shall be cause for the revocation of the certificate and shall
50-25 subject the motor bus company so failing to the penalties
50-26 prescribed herein.
50-27 (b) Section 4, Chapter 1050, Acts of the 70th Legislature,
51-1 Regular Session, 1987, is repealed.
51-2 SECTION 28. (a) Section 13, Chapter 314, Acts of the 41st
51-3 Legislature, Regular Session, 1929 (Article 911b, Vernon's Texas
51-4 Civil Statutes), as amended by Chapter 377, Acts of the 70th
51-5 Legislature, Regular Session, 1987, and by Chapter 894, Acts of the
51-6 72nd Legislature, Regular Session, 1991, is amended to read as
51-7 follows:
51-8 Sec. 13. Before any permit or certificate of public
51-9 convenience and necessity may be issued to any motor carrier and
51-10 before any motor carrier may lawfully operate under such permit or
51-11 certificate as the case may be, such motor carrier shall file with
51-12 the Commission bonds and/or insurance policies issued by some
51-13 insurance company including mutuals and reciprocals or bonding
51-14 company holding a certificate of authority to transact such kinds
51-15 of insurance business in Texas or, with the approval of the
51-16 Commission <Commissioner>, by a surplus lines insurer meeting the
51-17 requirements of Article 1.14-2, Insurance Code, and rules adopted
51-18 by the commissioner of insurance <State Board of Insurance> under
51-19 that article. The commission shall adopt rules covering the
51-20 coverage limits and terms of the insurance policy, except that the
51-21 coverage provided under the policy must meet the requirements of
51-22 Chapter 27, Insurance Code. The bonds or<, in an amount to be
51-23 fixed by the Commission under such rules and regulations as it may
51-24 prescribe, which bonds and> insurance policies shall provide that
51-25 the obligor therein will pay to the extent of the face amount of
51-26 such insurance policies and bonds benefits under the policy and any
51-27 judgment that <all judgments which> may be recovered against the
52-1 motor carrier so filing said insurance policies and bonds, based on
52-2 claims for loss or damages from personal injury or loss of, or
52-3 injury to property occurring during the term of said bonds and
52-4 policies and arising out of the actual operation of such motor
52-5 carrier; and such bonds and policies shall also provide for
52-6 successive recoveries to the complete exhaustion of the face amount
52-7 thereof and that the benefits and <such> judgments will be paid by
52-8 the obligor in said bonds and insurance policies irrespective of
52-9 the solvency or insolvency of the motor carrier; provided, however,
52-10 such bonds and policies shall not cover personal injuries sustained
52-11 by the servants, agents or employees of such motor carrier.
52-12 Provided further, that in the event the insured shall abandon his
52-13 permit or certificate and leave the state, a claimant, asserting a
52-14 claim within the provisions of said bonds or policies, may file
52-15 suit against the sureties executing such bond or the company
52-16 issuing such policies in a court of competent jurisdiction without
52-17 the necessity of making the insured a party to said suit.
52-18 Provided, however, that the Commission shall not require insurance
52-19 covering loss of or damage to cargo in amount excessive for the
52-20 class of service to be rendered by any motor carrier. Each such
52-21 motor carrier shall, on or before the date of the expiration of the
52-22 term of any policy or bond so filed by him, file a renewal thereof,
52-23 or new bonds or policies containing the same terms and obligations
52-24 of the preceding bonds and policies, and shall each year thereafter
52-25 on or before the expiration date of the existing bonds and
52-26 policies, file such renewal policies and bonds so as to provide
52-27 continuous and unbroken protection to the public having legal
53-1 claims against such motor carrier; and in the event such renewal
53-2 bonds and policies are not so filed, the Commission, after notice
53-3 to the motor carrier, and hearing, may, within its discretion if it
53-4 shall find and determine that the ends of justice will be better
53-5 subserved thereby, cancel such permit or certificate for failure to
53-6 furnish and provide such bonds or insurance as herein required.
53-7 The Commission may accept in lieu of the filing of the original
53-8 policies of insurance, a certificate of insurance, in such form as
53-9 may be prescribed by the Commission, which certificate, when filed
53-10 with the Commission, will bind the obligor thereunder and satisfy
53-11 the requirements of this section as if the original policies of
53-12 insurance had been filed.
53-13 Each motor carrier shall also protect his employees by
53-14 obtaining workers' compensation insurance coverage as defined under
53-15 Subtitle A, Title 5, Labor Code, <the Texas Workers' Compensation
53-16 Act (Article 8308-1.01 et seq., Vernon's Texas Civil Statutes)> or
53-17 accidental insurance coverage in an amount fixed by the Commission
53-18 from a reliable insurance company or companies authorized to write
53-19 such policies in this state approved by the Commission.
53-20 (b) Section 5, Chapter 1050, Acts of the 70th Legislature,
53-21 Regular Session, 1987, is repealed.
53-22 SECTION 29. (a) Articles 5.06-1 and 5.06-3, Insurance Code,
53-23 are repealed.
53-24 (b) Sections 18, 19, 22, 24, and 25, Texas Motor Vehicle
53-25 Safety-Responsibility Act (Article 6701h, Vernon's Texas Civil
53-26 Statutes), are repealed.
53-27 SECTION 30. Chapter 27, Insurance Code, as added by this
54-1 Act, would not have been enacted if Article 27.52, Insurance Code,
54-2 had not been enacted. If Article 27.52, Insurance Code, is held
54-3 invalid, Chapter 27, Insurance Code, as added by this Act, is
54-4 invalid.
54-5 SECTION 31. (a) The commissioner of insurance shall adjust
54-6 the benchmark rate or other applicable premium rate attributable to
54-7 coverage for bodily injury arising out of the use of a motor
54-8 vehicle other than a motorcycle for all motor vehicle insurance
54-9 policies under Chapter 27, Insurance Code, as added by this Act,
54-10 issued on or after January 1, 1996, and before January 1, 1997, to
54-11 reflect at least a 12 percent reduction in the overall premium rate
54-12 for bodily injury liability coverage that was effective on January
54-13 1, 1995, distributed among rate classifications in accordance with
54-14 sound actuarial principles.
54-15 (b) The reductions in rates required by this section take
54-16 effect only on a finding by the commissioner of insurance that:
54-17 (1) the reductions would be consistent with the
54-18 encouragement of the prevention of accidents;
54-19 (2) the reductions are appropriate after consideration
54-20 of the peculiar hazard and experience of individual risks, past and
54-21 prospective, in and out of the state, and all other relevant
54-22 factors, in and out of the state;
54-23 (3) the reductions are fair, reasonable, and not
54-24 confiscatory as to any class of insurer authorized by law to write
54-25 motor vehicle insurance in this state; and
54-26 (4) the statistical data and other information
54-27 provided to justify the reductions indicate that approval of the
55-1 reductions is reasonable.
55-2 SECTION 32. (a) Except as provided by Subsection (b) of
55-3 this section, this Act takes effect September 1, 1995.
55-4 (b) Sections 11 through 29 of this Act take effect January
55-5 1, 1996.
55-6 (c) This Act applies only to an insurance policy that is
55-7 delivered, issued for delivery, or renewed on or after January 1,
55-8 1996. A policy that is delivered, issued for delivery, or renewed
55-9 before January 1, 1996, is governed by the law as it existed
55-10 immediately before the effective date of this Act, and that law is
55-11 continued in effect for that purpose.
55-12 (d) Subchapter C, Chapter 27, Insurance Code, as added by
55-13 this Act, applies only to an action to recover damages for
55-14 accidental injury that accrues on or after January 1, 1996. An
55-15 action that accrues before January 1, 1996, is governed by the law
55-16 in effect at the time the action accrues, and that law is continued
55-17 in effect for that purpose.
55-18 SECTION 33. The importance of this legislation and the
55-19 crowded condition of the calendars in both houses create an
55-20 emergency and an imperative public necessity that the
55-21 constitutional rule requiring bills to be read on three several
55-22 days in each house be suspended, and this rule is hereby suspended.