By Dutton                                        H.B. No. 505

      75R2367 PB-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to qualification as a self-insurer to satisfy certain

 1-3     evidence of financial responsibility  requirements.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Section 601.124, Transportation Code, is amended

 1-6     to read as follows:

 1-7           Sec. 601.124.  SELF-INSURANCE.  (a)  A person in whose name

 1-8     more than 25 motor vehicles are registered may qualify as a

 1-9     self-insurer by obtaining a certificate of self-insurance issued by

1-10     the department as provided by this section.

1-11           (b)  The department may issue a certificate of self-insurance

1-12     to a person if:

1-13                 (1)  the person applies for the certificate; and

1-14                 (2)  the department is satisfied that the person:

1-15                       (A)  has and will continue to have the ability to

1-16     pay judgments obtained against the person; and

1-17                       (B)  is in compliance with the requirements

1-18     imposed under Subsections (c), (d), and (e).

1-19           (c)  The self-insurer must supplement the certificate with an

1-20     agreement that, for accidents occurring while  the certificate is

1-21     in force, the self-insurer will pay the same judgments in the same

1-22     amounts as an insurer would be obligated to pay under an owner's

1-23     motor vehicle liability insurance policy issued to the self-insurer

1-24     if such policy were issued.

 2-1           (d)  A person who self-insures under this section is subject

 2-2     to Article 21.55, Insurance Code, as if the  person were an insurer

 2-3     under that article.

 2-4           (e)  A person who self-insures under this section shall use

 2-5     the services of an insurance adjuster licensed under Chapter 407,

 2-6     Acts of the 63rd Legislature, Regular Session, 1973 (Article

 2-7     21.07-4, Vernon's Texas Insurance Code), to investigate or adjust a

 2-8     loss in a claim involving a motor vehicle registered to the person.

 2-9           (f)  The department for cause may cancel a certificate of

2-10     self-insurance after a hearing.  The self-insurer must  receive at

2-11     least five days' notice of the hearing.  Cause includes failure to

2-12     pay a judgment before the 31st day after the date the judgment

2-13     becomes final.

2-14           SECTION 2.  This Act takes effect September 1, 1997, and

2-15     applies only to a certificate of self-insurance that is issued  or

2-16     renewed by the Department of Public Safety on or after January 1,

2-17     1998.  A certificate that is issued or renewed before January 1,

2-18     1998, is governed by the law as it existed immediately before the

2-19     effective date of this Act, and that law is continued in effect for

2-20     that purpose.

2-21           SECTION 3.  The importance of this legislation and the

2-22     crowded condition of the calendars in both houses create an

2-23     emergency and an imperative public necessity that the

2-24     constitutional rule requiring bills to be read on three several

2-25     days in each house be suspended, and this rule is hereby suspended.