By Cuellar H.B. No. 2404
75R7458 PB-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to motor vehicle insurance coverage written through the
1-3 Texas Automobile Insurance Plan Association.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 1(2), Article 21.81, Insurance Code, is
1-6 amended to read as follows:
1-7 (2) "Authorized insurer" means any insurer authorized
1-8 by the Texas Department of Insurance to write motor vehicle
1-9 liability coverage under the provisions of Chapter 5 of this code.
1-10 The term includes [does not include] an insurer organized under
1-11 Chapter 17 of this code for the portion of that insurer's voluntary
1-12 market insurance policies for which the rates for bodily injury
1-13 liability coverage are at or below the rates that are provided by
1-14 the association for that coverage and that are in effect on the
1-15 effective date of the voluntary market policy issued by the
1-16 insurer.
1-17 SECTION 2. Section 4, Article 21.81, Insurance Code, is
1-18 amended by adding Subsections (c) and (d) to read as follows:
1-19 (c) A person who obtains, from any source, private passenger
1-20 auto liability insurance coverage that exceeds the minimum
1-21 automobile liability coverage required by law is ineligible for
1-22 insurance coverage through the association. The coverage for the
1-23 excess and basic limits policies is not affected by a violation of
1-24 this subsection unless the insurer demonstrates to the satisfaction
2-1 of the commissioner that the insured had actual knowledge that the
2-2 insured was ineligible for coverage through the association.
2-3 (d) An agent may not write excess private passenger
2-4 automobile liability insurance coverage for an insured whom the
2-5 agent knows to have coverage provided through the association for
2-6 the minimum automobile liability coverage required by law. An
2-7 agent who violates this subsection is subject to sanctions as
2-8 provided by Section 7, Article 1.10, of this code.
2-9 SECTION 3. Section 5, Article 21.81, Insurance Code, is
2-10 amended by adding Subsection (c) to read as follows:
2-11 (c) Notwithstanding Subsection (a) of this section, the
2-12 commissioner shall set rates charged for insurance provided
2-13 through the association at 145 percent of the benchmark rate
2-14 established by the commissioner under Article 5.101 of this code,
2-15 and shall set surcharges for insurance provided through the
2-16 association for at-fault accidents and convictions at 200 percent
2-17 of the surcharges authorized by Rule 42, Texas Automobile Rules and
2-18 Rating Manual, as that rule existed on February 1, 1997. This
2-19 subsection expires September 1, 2001.
2-20 SECTION 4. Article 21.81, Insurance Code, as amended by this
2-21 Act, applies only to an insurance policy that is delivered, issued
2-22 for delivery, or renewed on or after January 1, 1998. A policy
2-23 that is delivered, issued for delivery, or renewed before January
2-24 1, 1998, is governed by the law as it existed immediately before
2-25 the effective date of this Act, and that law is continued in effect
2-26 for this purpose.
2-27 SECTION 5. The importance of this legislation and the
3-1 crowded condition of the calendars in both houses create an
3-2 emergency and an imperative public necessity that the
3-3 constitutional rule requiring bills to be read on three several
3-4 days in each house be suspended, and this rule is hereby suspended.