By:  Ellis                                            S.B. No. 1792
         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 the use of no prior insurance as an underwriting
 1-2     guideline in the issuance of a motor vehicle liability insurance
 1-3     policy.
 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 21.21-10 to read as follows:
 1-7           Art. 21.21-10  PROHIBITION AGAINST USING NO PRIOR INSURANCE
 1-8     AS AN UNDERWRITING GUIDELINE
 1-9           (a)  DEFINITIONS.  In this article:
1-10                 (1)  "Insurer means a person or entity that receives an
1-11     application for, or who delivers, issues for delivery, or renews a
1-12     motor vehicle liability insurance policy in this state.  The term
1-13     includes an interinsurance exchange, a mutual insurance company, a
1-14     county mutual insurance company, a reciprocal exchange, an
1-15     association, or a Lloyd's plan, as well as an agent of any of these
1-16     entities or of any insurer.
1-17                 (2)  "Policy" means any motor vehicle liability
1-18     insurance policy that provides personal auto coverage.
1-19           (b)  An insurer, solely or in part because of an individual's
1-20     or individuals' lack of prior insurance, may not:
1-21                 (1)  refuse to issue a policy to the individual(s).
1-22                 (2)  cancel a policy covering the individual(s)
 2-1                 (3)  limit the amount, extent, or kind of coverage
 2-2     available to the individual(s) under a policy; or
 2-3                 (4)  charge the individual(s) a different rate for the
 2-4     policy.
 2-5           (c)  A policy applicant currently or previously insured in a
 2-6     higher-rated insurance company or through the Texas Automobile
 2-7     Insurance Plan Association (the assigned risk plan) will be
 2-8     underwritten without consideration of the applicant's prior
 2-9     insurance carrier.
2-10           (d)  An insurer who makes a quote to a policy applicant with
2-11     no prior insurance, having no more than one accident and one
2-12     violation within the past three years, which quote equals or
2-13     exceeds the premium available through the assigned risk plan, must
2-14     inform the applicant of the approximate cost of coverage available
2-15     through the assigned risk plan.
2-16           (e)  An insurer who violates this article commits an unfair
2-17     and deceptive practice as defined by Article 21.21 of this code and
2-18     is subject to the penalties under that article.
2-19     SECTION 2.  This Act takes effect September 1, 1999.
2-20           SECTION 3.  The importance of this legislation and the
2-21     crowded condition of the calendars in both houses create an
2-22     emergency and an imperative public necessity that the
2-23     constitutional rule requiring bills to be read on three several
2-24     days in each house be suspended, and this rule is hereby suspended.