By Burnam H.B. No. 3099
76R7263 AJA-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a mile-based rating plan for motor vehicle insurance.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter A, Chapter 5, Insurance Code, is
1-5 amended by adding Article 5.01-4 to read as follows:
1-6 Art. 5.01-4. TIME-BASED AND MILE-BASED RATING PLANS
1-7 REQUIRED. (a) In this article:
1-8 (1) "Mile-based rating plan" means a rating plan for
1-9 which a unit of exposure is one mile traveled by the insured motor
1-10 vehicle.
1-11 (2) "Time-based rating plan" means a rating plan for
1-12 which a unit of exposure is a unit of time.
1-13 (b) An insurer writing motor vehicle insurance in this state
1-14 shall offer each person who purchases motor vehicle insurance
1-15 coverage from that insurer a choice between a mile-based rating
1-16 plan and a time-based rating plan for coverage for losses caused by
1-17 collision or other driving-related accident.
1-18 (c) The commissioner shall adopt rules as necessary or
1-19 appropriate to govern the use of a mile-based rating plan under
1-20 this article, including rules regarding:
1-21 (1) prepayment arrangements;
1-22 (2) proof of financial responsibility;
1-23 (3) auditing of the odometer of a vehicle for the
1-24 purpose of determining whether coverage is in force; and
2-1 (4) policy forms.
2-2 (d) This article applies to county mutual insurance
2-3 companies.
2-4 SECTION 2. Article 5.101, Insurance Code, is amended by
2-5 adding Section 6 to read as follows:
2-6 Sec. 6. TIME-BASED AND MILE-BASED RATING PLANS FOR MOTOR
2-7 VEHICLE INSURANCE. (a) In this section:
2-8 (1) "Mile-based rating plan" means a rating plan for
2-9 which a unit of exposure is one mile traveled by the insured motor
2-10 vehicle.
2-11 (2) "Time-based rating plan" means a rating plan for
2-12 which a unit of exposure is a unit of time.
2-13 (b) Notwithstanding this article or any other insurance law
2-14 of this state, for motor vehicle insurance lines subject to this
2-15 article that provide coverage for losses caused by collision or
2-16 other driving-related accident, the commissioner shall promulgate
2-17 separate benchmark rates for mile-based rating plans and time-based
2-18 rating plans.
2-19 (c) In promulgating a rating manual for a motor vehicle
2-20 insurance line under Section 3(k) of this article, the commissioner
2-21 must use the same classifications and territories for mile-based
2-22 and time-based rating plans.
2-23 (d) The commissioner may not approve a rating manual under
2-24 Section 3(l) of this article for a motor vehicle insurance line
2-25 subject to this article if the classifications and territories used
2-26 in the manual are not the same for mile-based and time-based rating
2-27 plans.
3-1 SECTION 3. This Act takes effect September 1, 1999.
3-2 SECTION 4. (a) This Act applies only to a motor vehicle
3-3 insurance policy that is delivered, issued for delivery, or renewed
3-4 on or after January 1, 2000. A motor vehicle policy delivered,
3-5 issued for delivery, or renewed before January 1, 2000, is governed
3-6 by the law as it existed immediately before the effective date of
3-7 this Act, and that law is continued in effect for that purpose.
3-8 (b) An insurer is not required to offer a mile-based rating
3-9 plan as required under Article 5.01-4, Insurance Code, as added by
3-10 this Act, before January 1, 2002. An insurer may only offer a
3-11 mile-based rating plan before January 1, 2002, with the approval of
3-12 the commissioner of insurance.
3-13 (c) The commissioner of insurance shall adopt all rules
3-14 necessary to implement Article 5.01-4, Insurance Code, as added by
3-15 this Act, not later than September 1, 2001.
3-16 SECTION 5. The importance of this legislation and the
3-17 crowded condition of the calendars in both houses create an
3-18 emergency and an imperative public necessity that the
3-19 constitutional rule requiring bills to be read on three several
3-20 days in each house be suspended, and this rule is hereby suspended.