SRC-DPW H.B. 3091 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 3091
76R11590 DWS-FBy: Siebert (Brown)
Administration
5/4/1999
Engrossed


DIGEST 

Currently, Article 9026, V.T.C.S., governs the sale of loss damage waivers
to renters of private passenger vehicles.  Loss damage waivers are offered
as an additional service by the rental company, and their purchase is
entirely voluntary and at the discretion of the renter of the vehicle.  A
majority of states have adopted a model law regulating the sale of loss
damage waivers to motor vehicle renters. This bill would adopt the model
consumers protection law now in effect in a majority of states, put Texas
law in the national mainstream in protecting consumers from abuses stemming
from nondisclosure of mandatory charges, establish procedures and
guidelines for the purchase of rental car damage waivers, and provide
penalties for violations of this Act. 

PURPOSE

As proposed, H.B. 3091 establishes procedures and guidelines for the
purchase of rental car damage waivers and provides penalties for violations
of this Act.   

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Chapter 20, Title 132, V.T.C.S., by adding Article 9026c, as
follows: 

Art. 9026c. RENTAL CAR DAMAGE WAIVER

Sec. 1. DEFINITIONS. Defines "rental company," "renter," "rental
agreement," "damage," "private passenger vehicle," "authorized driver," and
"damage waiver." 

Sec. 2. PROHIBITED PRACTICES. Prohibits a rental company from selling a
damage waiver unless the renter agrees to the damage waiver in writing
before the time the rental agreement is executed.  Prohibits a rental
company from voiding a damage waiver except for certain reasons regarding
the cause of the damage.   

Sec. 3. DISCLOSURE NOTICE REQUIREMENTS. Requires a rental company to
provide a disclosure notice to each renter who purchases a damage waiver
that is not included in the base rental rate.  Sets forth required text and
format of the required notice.   

Sec. 4. MANDATORY CHARGES. Defines "mandatory charges."  Requires a rental
agreement containing a mandatory charge to prominently display and fully
disclose the charge separately on the face of the agreement and in all the
rental company's price advertising, price displays, price quotes, and price
offers.  Prohibits a rental company from imposing or requiring the purchase
of a damage waiver as a mandatory charge.   

Sec. 5. PENALTY. Subjects a rental company that violates this article to a
civil penalty in an amount of at least $500 and not to exceed $1,000 for
each violation.  Authorizes a county or district attorney or the attorney
general to institute and conduct a suit in the name of the state to recover
the civil penalty, injunctive relief, or both.  Authorizes any person or
entity injured or threatened with injury by a violation of this article to
seek injunctive relief against any company or person who violates this
article. 

 SECTION 2. Repealer: Article 9026, V.T.C.S. (Automobile rental agreements).

SECTION 3. Makes application of this Act prospective.

SECTION 4. Effective date: September 1, 1999.

SECTION 5. Emergency clause.