By Lewis of Tarrant                                   H.B. No. 3177
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to payment of claims by the Texas Property and Casualty
 1-3     Insurance Guaranty Association.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 8(d), Article 21.28-C, Insurance Code, is
 1-6     amended to read as follows:
 1-7           (d)  The association shall investigate and adjust,
 1-8     compromise, settle, and pay covered claims to the extent of the
 1-9     association's obligation and deny all other claims.  The
1-10     association may review settlements, releases, and judgments to
1-11     which the impaired insurer or its insureds were parties to
1-12     determine the extent to which those settlements, releases, and
1-13     judgments may be properly contested.  Any judgment taken by default
1-14     or consent against an insured or the impaired insurer, [and any
1-15     settlement, release, or judgment entered into by the insured or the
1-16     impaired insurer,] is not binding on the association, and may not
1-17     be considered as evidence of liability or of damages in connection
1-18     with any claim brought against the association or any other party
1-19     under this Act.  Notwithstanding any other provision of this Act or
1-20     of Article 21.28 of this code, a covered claim shall not include
1-21     any claim filed with the guaranty association after [the later of
1-22     the final date for filing claims against the liquidator or receiver
1-23     of an insolvent insurer or] eighteen months following [after] the
1-24     order of impairment unless the court shall find that a compelling
 2-1     reason exists for the time to be extended to address unusual or
 2-2     extenuating circumstances [liquidation].
 2-3           SECTION 2.  This Act is intended to clarify the law as it
 2-4     existed immediately before the effective date of this Act and
 2-5     applies to payment of covered claims with respect to a designation
 2-6     of impairment made before, on, or after the effective date of this
 2-7     Act.
 2-8           SECTION 3.  The importance of this legislation and the
 2-9     crowded condition of the calendars in both houses create an
2-10     emergency and an imperative public necessity that the
2-11     constitutional rule requiring bills to be read on three several
2-12     days in each house be suspended, and this rule is hereby suspended.