By Brimer H.B. No. 2630 Line and page numbers may not match official copy. Bill not drafted by TLC or Senate E&E. A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to coverage for owners and contractors under certain 1-3 policies covering subcontractors. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter B, Chapter 5, Insurance Code, is 1-6 amended by adding Article 5.17 to read as follows: 1-7 Art. 5.17. SUBCONTRACTOR'S GENERAL LIABILITY OR WORKERS' 1-8 COMPENSATION POLICY; CERTAIN COVERAGE PROHIBITED. (a) In this 1-9 article: 1-10 (1) "General contractor" means a person who: 1-11 (A) under contract with a project owner, 1-12 performs work or arranges for work to be performed; and 1-13 (B) is not controlled by the project owner and 1-14 is not subject to the project owner's right of control with respect 1-15 to the performance of the work. 1-16 (2) "Owners and contractors protective liability 1-17 insurance" is insurance that provides coverage for the named 1-18 insured's liability arising out of: 1-19 (A) operations performed for the named insured 1-20 by an identified general contractor or subcontractor in connection 1-21 with an identified project; or 1-22 (B) the named insured's acts or omissions in 2-1 connection with the named insured's general supervision of the 2-2 general contractor's or subcontractor's work. 2-3 (3) "Project owner" means a person who, directly or 2-4 through an agent, contracts with a general contractor. 2-5 (4) "Subcontractor" means a person who furnishes labor 2-6 to fulfill an obligation to a general contractor or to another 2-7 subcontractor to perform all or part of the work required by the 2-8 contract between the project owner and the general contractor. 2-9 (b) A general liability or workers' compensation insurance 2-10 policy issued to a subcontractor may not, through endorsement or 2-11 otherwise, provide coverage for a project owner or general 2-12 contractor for liability for damages arising from or workers' 2-13 compensation benefits for personal injury, death, or damage to the 2-14 property of others arising from the project that is the subject of 2-15 the contract if liability coverage providing substantially similar 2-16 protection is available to the project owner or general contractor 2-17 through an owners and contractors protective liability insurance 2-18 policy. 2-19 (c) The commissioner may adopt rules as necessary to 2-20 implement this article. 2-21 SECTION 2. This Act takes effect September 1, 1997, and 2-22 applies only to an insurance policy that is delivered, issued for 2-23 delivery, or renewed on or after January 1, 1998. A policy that is 2-24 delivered, issued for delivery, or renewed before January 1, 1998, 2-25 is governed by the law as it existed immediately before the 2-26 effective date of this Act, and that law is continued in effect for 2-27 that purpose. 3-1 SECTION 3. The importance of this legislation and the 3-2 crowded condition of the calendars in both houses create an 3-3 emergency and an imperative public necessity that the 3-4 constitutional rule requiring bills to be read on three several 3-5 days in each house be suspended, and this rule is hereby suspended.