By: Sibley S.B. No. 1913 Line and page numbers may not match official copy. Bill not drafted by TLC or Senate E&E. A BILL TO BE ENTITLED AN ACT 1-1 relating to service contracts sold by a manufacturer or seller of 1-2 property covered by a service contract. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Section 2, Article 1.14-1, Insurance Code, is 1-5 amended by adding Subsection (b)(9) to read as follows: 1-6 (9) Transactions in this state involving service 1-7 contracts where the manufacturer or seller of the property or a 1-8 third party is the obligor of the service contract; provided that, 1-9 in the case of a third party obligor, the third party's obligation 1-10 is insured by an insurer licensed to do business in this state and 1-11 the third party obligor is acting through or with the written 1-12 agreement of the manufacturer or seller of the property. For 1-13 purposes of this subsection, "service contract" means a contract or 1-14 agreement for a separately stated consideration for a specific 1-15 duration to perform the repair, replacement or maintenance of 1-16 property or indemnification for repair, replacement or maintenance, 1-17 for the operational or structural failure due to defect in 1-18 materials, workmanship or normal wear and tear, with or without 1-19 additional provision for incidental payment of indemnity under 1-20 limited circumstances, including, but not limited to, towing, 1-21 rental and emergency road service, but does not include mechanical 2-1 breakdown insurance agreements sold by a person as defined in 2-2 Section 2(a), Article 21.21 of this code. 2-3 SECTION 2. This Act takes effect September 1, 1997. 2-4 SECTION 3. The importance of this legislation and the 2-5 crowded condition of the calendars in both houses create an 2-6 emergency and an imperative public necessity that the 2-7 constitutional rule requiring bills to be read on three several 2-8 days in each house be suspended, and this rule is hereby suspended.