By Dutton H.B. No. 1787
76R1196 AJA-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the ability of an insurer to obtain a release from
1-3 liability; providing a penalty.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter B, Chapter 21, Insurance Code, is
1-6 amended by adding Article 21.21-3 to read as follows:
1-7 Art. 21.21-3. RELEASE FROM LIABILITY FOR RELEASE OF
1-8 HAZARDOUS CHEMICALS; ASSESSMENT REQUIRED
1-9 Sec. 1. DEFINITIONS. In this article:
1-10 (1) "Insurer" means an individual, corporation,
1-11 association, partnership, reciprocal exchange, interinsurer, Lloyds
1-12 insurer, fraternal benefit society, and any other legal entity
1-13 engaged in the business of insurance. The term includes an agent,
1-14 broker, adjuster, or other representative of an insurer.
1-15 (2) "Release agreement" means:
1-16 (A) an agreement between an insured or an
1-17 insurer and an actual or potential third party claimant releasing
1-18 the insured or the insurer from liability with respect to an
1-19 accident or other event; or
1-20 (B) an agreement between an insured and an
1-21 insurer establishing the amount of liability of the insurer to the
1-22 insured with respect to an accident or other event.
1-23 Sec. 2. APPLICABILITY. This article applies only to a
1-24 release agreement obtained in connection with the deposit,
2-1 discharge, or release into the environment of hazardous chemicals,
2-2 hazardous wastes, hazardous hydrocarbons, similarly harmful organic
2-3 or mineral substances, hazardous radiation sources, and other
2-4 similarly harmful substances.
2-5 Sec. 3. ASSESSMENT OF DAMAGES REQUIRED. (a) A
2-6 representative of an insurance company may not obtain a release
2-7 agreement from a person unless:
2-8 (1) an assessment of the damages to the person has
2-9 been made by a neutral expert as required by rules adopted by the
2-10 commissioner; or
2-11 (2) the person is represented in negotiating the
2-12 release by legal counsel who is not directly or indirectly
2-13 identified, suggested, or selected by the insurer or the insured.
2-14 (b) An expert who performs an assessment under Subsection
2-15 (a) of this section may not be the employee of the insurer or the
2-16 insured.
2-17 (c) An insurer seeking a release agreement shall pay any
2-18 fees or expenses involved in obtaining the assessment of damages
2-19 required under Subsection (a) of this section.
2-20 Sec. 4. RULES. The commissioner shall adopt rules as
2-21 necessary to implement this article.
2-22 Sec. 5. DISCIPLINARY ACTION. The commissioner, on 10 days'
2-23 notice by certified mail and on hearing, may suspend or cancel the
2-24 certificate or other authority to engage in the business of
2-25 insurance of any insurer violating this article.
2-26 Sec. 6. PENALTY. (a) A person commits an offense if the
2-27 person knowingly or intentionally violates Section 3 of this
3-1 article.
3-2 (b) An offense under this section is a Class A misdemeanor.
3-3 SECTION 2. This Act takes effect September 1, 1999.
3-4 SECTION 3. This Act applies only to a release agreement that
3-5 is executed on or after the effective date of this Act. A release
3-6 agreement that is executed before the effective date of this Act is
3-7 governed by the law as it existed immediately before the effective
3-8 date of this Act, and that law is continued in effect for that
3-9 purpose.
3-10 SECTION 4. The importance of this legislation and the
3-11 crowded condition of the calendars in both houses create an
3-12 emergency and an imperative public necessity that the
3-13 constitutional rule requiring bills to be read on three several
3-14 days in each house be suspended, and this rule is hereby suspended.