By Nixon                                        H.B. No. 2990

      75R309 DLF-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the term of certain motor vehicle insurance policies.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Article 5.06(9), Insurance Code, is amended to

 1-5     read as follows:

 1-6           (9)  A personal automobile insurance policy must provide

 1-7     liability coverage for a term of at least six months.  Liability

 1-8     coverage under the policy may not be terminated during the first

 1-9     six months after the date of issuance or renewal of the policy

1-10     because the insured fails to pay the premium owed or for any other

1-11     reason, except that the policy may be terminated:

1-12                 (A)  on the insured's request for cancellation of the

1-13     policy if the insured demonstrates that substitute insurance has

1-14     been obtained; or

1-15                 (B)  for fraud by the insured or another person in

1-16     obtaining the policy.  [An insurance policy or other document

1-17     evidencing proof of purchase of a personal automobile insurance

1-18     policy written for a term of less than 30 days may not be used to

1-19     obtain an original or renewal driver's license, an automobile

1-20     registration or license plates, or a motor vehicle inspection

1-21     certificate and must contain a statement as follows:]

1-22           ["TEXAS LAW PROHIBITS USE OF THIS DOCUMENT TO OBTAIN A MOTOR

1-23     VEHICLE INSPECTION CERTIFICATE, AN ORIGINAL OR RENEWAL DRIVER'S

1-24     LICENSE, OR AN AUTOMOBILE REGISTRATION OR LICENSE PLATES."]

 2-1           SECTION 2.  Article 5.06(10), Insurance Code, is repealed.

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

 2-3     applies only to an insurance policy that is delivered, issued for

 2-4     delivery, or renewed on or after January 1, 1998.  A policy that is

 2-5     delivered, issued for delivery, or renewed before January 1, 1998,

 2-6     is governed by the law as it existed immediately before the

 2-7     effective date of this Act, and that law is continued in effect for

 2-8     that purpose.

 2-9           SECTION 4.  The importance of this legislation and the

2-10     crowded condition of the calendars in both houses create an

2-11     emergency and an imperative public necessity that the

2-12     constitutional rule requiring bills to be read on three several

2-13     days in each house be suspended, and this rule is hereby suspended.