1-1 AN ACT 1-2 relating to risk pools established by political subdivisions to 1-3 provide liability coverage. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Chapter 119, Local Government Code, is amended by 1-6 adding Sections 119.012, 119.013, and 119.014 to read as follows: 1-7 Sec. 119.012. NOTICE OF CANCELLATION OR CHANGE OF COVERAGE. 1-8 (a) Except as provided by Subsection (b), cancellation of coverage 1-9 for liability provided through the pool under this chapter other 1-10 than cancellation for nonpayment of contribution, or any change to 1-11 the terms or conditions of the coverage, may not take effect before 1-12 the 60th day after the earlier of the date that written notice of 1-13 the change is: 1-14 (1) delivered to the county judge or presiding officer 1-15 of the governing body of each affected county or other political 1-16 subdivision; or 1-17 (2) mailed, by certified mail, to the county judge or 1-18 presiding officer of the governing body of each affected county or 1-19 other political subdivision. 1-20 (b) Notice is not required for cancellation or a change to 1-21 the terms or conditions of the coverage made: 1-22 (1) at the request of the affected county or other 1-23 political subdivision; or 1-24 (2) by mutual agreement of the governing body, or 2-1 authorized agent, of the affected county or other political 2-2 subdivision and the pool if: 2-3 (A) the mutual agreement is evidenced by a 2-4 writing; and 2-5 (B) not later than the 72nd hour before the 2-6 governing body takes formal action with respect to the agreement, 2-7 the writing described by Paragraph (A) is provided, electronically 2-8 or by certified mail, to the county judge or presiding officer of 2-9 the governing body of the political subdivision. 2-10 (c) The notice must be printed in at least 12-point 2-11 bold-faced type and must specify the reasons for the cancellation 2-12 or change. 2-13 (d) In the case of cancellation of the coverage, the notice 2-14 must state that, on request of the affected county or other 2-15 political subdivision, the pool shall refund to the county or 2-16 political subdivision the pro rata unearned paid contribution of 2-17 the county or political subdivision. This subsection does not 2-18 apply if the refund is paid at the time the notice is made. 2-19 Sec. 119.013. QUALIFICATIONS OF ADMINISTRATOR. The 2-20 individual responsible for administration of the pool, whether 2-21 employed by the pool or any other entity: 2-22 (1) must hold at least a bachelor's degree in a field 2-23 relating to insurance, finance, business management, or law or hold 2-24 the professional designation of: 2-25 (A) Chartered Property Casualty Underwriter 2-26 granted by the American Institute for Property and Liability 2-27 Underwriters; 3-1 (B) Certified Insurance Counselor granted by the 3-2 Society of Certified Insurance Counselors; or 3-3 (C) Associate in Risk Management granted by the 3-4 Insurance Institute of America; 3-5 (2) must have at least five years experience in 3-6 administration of risk pools, commercial insurance production or 3-7 management, or risk management; and 3-8 (3) during each calendar year, shall participate in a 3-9 minimum of 20 hours of continuing education that: 3-10 (A) is acceptable to the board; and 3-11 (B) relates to the types of coverage provided by 3-12 the pool, risk management, or administration of risk pools. 3-13 Sec. 119.014. APPLICATION REQUIREMENTS. The requirements of 3-14 Section 119.012 shall apply to cancellation of, or any change to 3-15 the terms or conditions of, a contractual obligation to indemnify 3-16 for liability for the acts or omissions of a county or its officers 3-17 and employees provided to any county through any intergovernmental 3-18 risk-sharing pool or insurance coverage. 3-19 SECTION 2. This Act applies only to coverage provided under 3-20 a contract that is entered into or renewed or a policy that is 3-21 delivered, issued for delivery, or renewed on or after January 1, 3-22 1998. A contract that is entered into or renewed or a policy that 3-23 is delivered, issued for delivery, or renewed before January 1, 3-24 1998, is governed by the law as it existed immediately before the 3-25 effective date of this Act, and that law is continued in effect for 3-26 this purpose. 3-27 SECTION 3. (a) An individual responsible for administration 4-1 of the County Government Risk Management Pool under Chapter 119, 4-2 Local Government Code, is not required to satisfy the requirements 4-3 of Sections 119.013(1) and (2), Local Government Code, as added by 4-4 this Act, before January 1, 1998, or the requirements of Section 4-5 119.013(3), Local Government Code, as added by this Act, before 4-6 December 31, 1998. 4-7 (b) The change in law made by Section 119.013, Local 4-8 Government Code, as added by this Act, applies only to the 4-9 qualifications of an individual who is responsible for 4-10 administration of the risk pool under a contract entered into or 4-11 renewed on or after the effective date of this Act. The 4-12 qualifications of an individual who is responsible for 4-13 administration of the risk pool under a contract entered into or 4-14 renewed before the effective date of this Act is governed by the 4-15 law as it existed immediately before the effective date of this 4-16 Act, and that law is continued in effect for this purpose. 4-17 SECTION 4. This Act takes effect September 1, 1997. 4-18 SECTION 5. The importance of this legislation and the 4-19 crowded condition of the calendars in both houses create an 4-20 emergency and an imperative public necessity that the 4-21 constitutional rule requiring bills to be read on three several 4-22 days in each house be suspended, and this rule is hereby suspended. _______________________________ _______________________________ President of the Senate Speaker of the House I certify that H.B. No. 2736 was passed by the House on May 16, 1997, by a non-record vote; and that the House concurred in Senate amendments to H.B. No. 2736 on May 28, 1997, by a non-record vote. _______________________________ Chief Clerk of the House I certify that H.B. No. 2736 was passed by the Senate, with amendments, on May 26, 1997, by a viva-voce vote. _______________________________ Secretary of the Senate APPROVED: _____________________ Date _____________________ Governor