By Burnam                                              H.B. No. 185
         77R713 AJA-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to cancellation of certain insurance policies.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Section 4, Article 21.49-2B, Insurance Code, is
 1-5     amended by amending Subsection (i) and adding Subsection (j) to
 1-6     read as follows:
 1-7           (i)  Except as provided by Subsection (j) of this section, an
 1-8     [An] insurer may cancel a personal automobile insurance policy if
 1-9     the policy [it] has been in effect less than 60 days.  An insurer
1-10     may cancel any other policy if the policy [it] has been in effect
1-11     less than 90 days.
1-12           (j)  An insurer may not cancel a policy under Subsection (i)
1-13     of this section based on:
1-14                 (1)  a claim brought under the policy that arose on or
1-15     after the first day that the policy was in effect; or
1-16                 (2)  an accident or other incident that occurred on or
1-17     after the first day that the policy was in effect, regardless of
1-18     whether the policyholder files a claim under the policy, unless the
1-19     policy is a personal automobile insurance policy and the operator
1-20     of the motor vehicle involved in the accident or incident is
1-21     insured under the policy and is charged under Section 49.03, 49.04,
1-22     49.07, or 49.08, Penal Code, in connection with the accident or
1-23     incident.
1-24           SECTION 2.  (a)  This Act takes effect September 1, 2001.
 2-1           (b)  Article 21.49-2B, Insurance Code, as amended by this
 2-2     Act, applies only to an insurance policy that is delivered, issued
 2-3     for delivery, or renewed on or after January 1, 2002.  A policy
 2-4     that is delivered, issued for delivery, or renewed before January
 2-5     1, 2002, is governed by the law as it existed immediately before
 2-6     the effective date of this Act, and that law is continued in effect
 2-7     for that purpose.