By Bonnen                                             H.B. No. 1477

         Substitute the following for H.B. No. 1477:

         By Gray                                           C.S.H.B. No. 1477

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to immunity from liability for the directors of the Texas

 1-3     Catastrophe Property Insurance Association.

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

 1-5           SECTION 1.  Section 9A(a), Article 21.49, Insurance Code, is

 1-6     amended to read as follows:

 1-7           (a)  Except as provided by section 10 of the Article, any

 1-8     [Any] person insured under this Act who is aggrieved by an act,

 1-9     ruling, or decision of the Association relating to the payment of,

1-10     the amount of, or the denial of a claim may elect to bring an

1-11     action under Article 21.21 of this code, against the Association in

1-12     a court of competent jurisdiction or to appeal the act, ruling, or

1-13     decision under Section 9 of the Article.  A person may not proceed

1-14     under both Section 9 of this Article and this section for the same

1-15     act, ruling or decision.

1-16           SECTION 2.  Section 10, Article 21.49, Insurance Code, is

1-17     amended to read as follows:

1-18           Section 10.  IMMUNITY FROM LIABILITY.  (a)  There shall be no

1-19     liability on the part of and no cause of action of any nature shall

1-20     arise against a director of the Association for any action or

1-21     failure to act in the performance of official powers and duties

1-22     under this Article, including any official power or duty relating

1-23     to the plan of operation or to any policy issued by the

1-24     Association, except that immunity from liability and suit does not

 2-1     extend to any bad faith act or failure to act, or to an act or

 2-2     failure to act that involves gross negligence, intentional

 2-3     misconduct, or a knowing violation of the law.

 2-4           (b)  There shall be no liability on the part of and cause of

 2-5     action of any nature shall arise against a director of the

 2-6     association, the board or any of its staff, the Association or its

 2-7     agents or employees, or against any participating insurer or its

 2-8     agents or employees, for any inspections made under the plan of

 2-9     operation or any statements made in good faith by them in any

2-10     reports or communications concerning risks submitted to the

2-11     Association, or to any administrative hearings conducted in

2-12     connection therewith under the provisions of this Act.

2-13           SECTION 3.  This Act takes effect September 1, 1997, and

2-14     applies only to a cause of action that accrues on or after that

2-15     date.  A cause of action that accrues before the effective date of

2-16     this Act is governed by the law as it existed immediately before

2-17     the effective date of this Act and that law is continued in effect

2-18     for that purpose.

2-19           SECTION 4.  The importance of this legislation and the

2-20     crowded condition of the calendars in both houses create an

2-21     emergency and an imperative public necessity that the

2-22     constitutional rule requiring bills to be read on three several

2-23     days in each house be suspended, and this rule is hereby suspended.