By: Armbrister S.B. No. 1740
97S0870/1
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the dissolution of the Texas workers' compensation
1-2 insurance facility and the transfer of certain assets and
1-3 liabilities to the Texas Property and Casualty Insurance Guaranty
1-4 Association.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. (a) The legislature finds and declares that:
1-7 (1) the requirement that the Texas workers'
1-8 compensation insurance facility contract with the Texas Workers'
1-9 Compensation Insurance Fund to assume all claims liabilities of the
1-10 facility is not in the best interest of the state and that the
1-11 Texas Property and Casualty Insurance Guaranty Association should
1-12 control the facility's operations;
1-13 (2) it is of paramount importance that all workers'
1-14 compensation claimants be assured that adequate financial resources
1-15 are available to pay workers' compensation claims as the claims
1-16 mature; and
1-17 (3) the facility has developed several public policy
1-18 initiatives which are important to the administration of the
1-19 workers' compensation system in Texas and should be continued,
1-20 including the antifraud program, servicing company performance
1-21 reviews, and collection of money due the facility.
1-22 (b) In accordance with Subsection (a) of this section, the
1-23 purposes of this Act are to:
2-1 (1) discontinue the Texas workers' compensation
2-2 insurance facility's operation as an independent entity by
2-3 transferring control of the facility to the Texas Property and
2-4 Casualty Insurance Guaranty Association;
2-5 (2) ensure that the Texas Property and Casualty
2-6 Insurance Guaranty Association has full authority to enforce the
2-7 existing rights of the facility without limitation except as
2-8 provided in this Act; and
2-9 (3) authorize the transfer of the facility's
2-10 operations without impairing the continuity of the public policy
2-11 initiatives provided in this section.
2-12 (c) This Act shall be liberally construed in conformity with
2-13 the legislative findings and purposes stated in this section.
2-14 SECTION 2. (a) On December 31, 1997, the members of the
2-15 governing committee of the Texas workers' compensation insurance
2-16 facility shall be deemed to have resigned and the board of
2-17 directors of the Texas Property and Casualty Insurance Guaranty
2-18 Association shall replace the governing committee of the facility.
2-19 (b) The board of directors of the Texas Property and
2-20 Casualty Insurance Guaranty Association shall submit to the
2-21 Commissioner of Insurance an amended plan of operation for the
2-22 assimilation of the operations of the Texas workers' compensation
2-23 insurance facility into the Texas Property and Casualty Insurance
2-24 Guaranty Association no later than October 31, 1997.
2-25 SECTION 3. Any assessment of members made after January 1,
3-1 1997, required to fund deficits from operations of the facility
3-2 shall be made as provided by Section 18, Article 21.28C, Insurance
3-3 Code, and shall be subject to the provisions of Section 21, Article
3-4 21.28-C, Insurance Code.
3-5 SECTION 4. The Texas Property and Casualty Insurance
3-6 Guaranty Association shall succeed to all rights, defenses,
3-7 immunities, and liabilities of the Texas workers' compensation
3-8 insurance facility in all litigation and other causes of action
3-9 pending by or against the facility on December 31, 1997, and causes
3-10 of action that arise after December 31, 1997, that relate to acts
3-11 or omissions that occurred prior to that date to which the facility
3-12 becomes a party. The litigation and causes of action described in
3-13 this section shall continue to be governed by and conducted under
3-14 Article 5.76-2, Insurance Code, and the applicable bylaws, rules,
3-15 and regulations of the facility.
3-16 SECTION 5. The immunity provisions of Subsection (h),
3-17 Section 2.05, Article 5.76-2, Insurance Code, and Section 2.12,
3-18 Article 5.76-2, Insurance Code, apply to all acts or omissions
3-19 occurring before, on, or after December 31, 1997, and such
3-20 provisions shall expressly apply to the powers and duties contained
3-21 in this Act.
3-22 SECTION 6. In an action against the Texas workers'
3-23 compensation insurance facility or its governing committee,
3-24 executive director, staff, agents, servants, attorneys,
3-25 consultants, employees, or member insurers, solely in their
4-1 capacity as member insurers, whether or not serving as such on
4-2 December 31, 1997, in connection with the facility's operations or
4-3 the transactions contemplated by this Act, the Texas Property and
4-4 Casualty Insurance Guaranty Association shall defend, indemnify,
4-5 and hold harmless such person for any act or omission taken in
4-6 connection with or arising from the performance of the person's
4-7 powers and duties on behalf of the facility.
4-8 SECTION 7. (a) Subsection (b), Section 18.24, Chapter 12,
4-9 Acts of the 72nd Legislature, 2nd Called Session, 1991, as amended
4-10 by Section 8, Chapter 885, Acts of the 73rd Legislature, 1993, is
4-11 hereby repealed.
4-12 (b) Section 2.03, Article 5.76-2, Insurance Code, is
4-13 repealed effective December 31, 1997.
4-14 SECTION 8. To the extent of a conflict between a provision
4-15 of this Act and any other law or statute, this Act shall control.
4-16 SECTION 9. The importance of this legislation and the
4-17 crowded condition of the calendars in both houses create an
4-18 emergency and an imperative public necessity that the
4-19 constitutional rule requiring bills to be read on three several
4-20 days in each house be suspended, and this rule is hereby suspended,
4-21 and that this Act take effect and be in force from and after its
4-22 passage, and it is so enacted.