JH C.S.H.B. 1166 75(R) BILL ANALYSIS URBAN AFFAIRS C.S.H.B. 1166 By: Garcia 4-17-97 Committee Report (Substituted) BACKGROUND Certain of the state's larger municipalities place restrictions on the insurance companies which may be used by taxicab companies within their jurisdictions. This has the effect of restricting the availability of insurance companies willing to insure taxicabs. The result is that small and midsized taxicab companies, which have difficulty meeting the selective underwriting guidelines of a limited insurance market, may be forced out of business or may have to pay non-competitive and excessive premiums. It is in the public interest that such an insurance market be open to all authorized insurance companies meeting the standards of reliability set by the state, and administered by the Texas Department of Insurance, to protect both vehicle owners and the general public. Chapter 215 of the Local Government Code is entitled Municipal Regulation of Miscellaneous Businesses and Other Activities. It contains provisions for the regulation of explosives, rendering plants, dairies, peddlers, and others. PURPOSE C.S.H.B. 1166 would regulate municipal requirements for taxicab insurance. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 215.004 of the Local Government Code to require a municipal ordinance requiring taxicab insurance to be obtained from a company authorized to transact business in Texas. Exempts taxicab companies which are self-insured. Ordinance may disqualify insurance company only for hazardous financial condition or for state of supervision, both determined by commissioner of insurance. Allows city requirement of certification for reinsurance if insurance required by ordinance exceeds ten percent of insurance company's capital. Disallows other municipal regulation of taxicab insurance. SECTION 2. Effective date September 1, 1997 SECTION 3. Emergency Clause COMPARISON OF ORIGINAL TO SUBSTITUTE The substitute adds the provisions concerning self-insurance, reinsurance, and the financial condition of insurance companies as determined by the commissioner of insurance.