ZEM H.B. 1265 75(R)BILL ANALYSIS


CIVIL PRACTICES
H.B. 1265
By: Garcia
4-24-97
Committee Report (Amended)



BACKGROUND 

Chapter 41 of the Civil Practices and Remedies Code places limitations on
punitive damages. Currently, punitive damages may not be awarded for harm
inflicted by an intoxicated driver of a motor vehicle. 

PURPOSE

HB 1265 removes restrictions imposed under Chapter 41 on punitive damages
awarded as a result of harm inflicted by an intoxicated driver of a motor
vehicle.  HB 1265, as amended, also mandates that all liability insurance
policies covering maintenance, use or ownership of a motor vehicle must
also cover punitive damages, up to policy limits, which may be awarded
under Section 41.002, subsection (e). 


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 41.002 of the Civil Practice and Remedies Code by
adding subsection (e) to provide that the limitations placed on awarding
exemplary damages under Chapter 41 of this code do not apply to the
recovery of such damages as a result of harm inflicted by an intoxicated
driver of a motor vehicle, as defined by Sec. 49.01, Penal Code.   

SECTION 2 Amends Subchapter A, Chapter 5 of the Insurance Code by adding
Article 5.06-7 to provide that all personal automobile insurance policies
which cover liability arising out of ownership, maintenance, or use of a
motor vehicle must also cover exemplary damages awarded due to harm
inflicted by an intoxicated driver. 
     
SECTION 3 Effective date:  September 1, 1997.  Applies prospectively.
Savings clause. 

SECTION 4 Emergency clause.



EXPLANATION OF AMENDMENTS

Committee Amendment #1 clarifies in SECTION 2 that an insurance company is
only liable for exemplary damages up to the limits of the policy.