By Averitt                                             H.B. No. 338
         77R2228 AJA-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to information related to criminal activity, fraud,
 1-3     material misrepresentation, or nondisclosure in connection with an
 1-4     insurance transaction.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  Subchapter E, Chapter 21, Insurance Code, is
 1-7     amended by adding Article 21.79H to read as follows:
 1-8           Art. 21.79H.  INFORMATION RELATING TO MISCONDUCT IN INSURANCE
 1-9     TRANSACTION.  (a)  In this article, "person" includes:
1-10                 (1)  an insurer;
1-11                 (2)  a self-insurer;
1-12                 (3)  an insurance support organization;
1-13                 (4)  an agent or third-party administrator licensed
1-14     under this code or an insurance law of this state;
1-15                 (5)  an employee of an entity described by Subdivisions
1-16     (1)-(4) of this subsection; or
1-17                 (6)  a regulatory authority.
1-18           (b)  A person may collect, compile, or furnish to or exchange
1-19     with any other person information to the extent the person
1-20     collecting, compiling, furnishing, or exchanging the information
1-21     considers reasonably necessary to detect or prevent criminal
1-22     activity, fraud, material misrepresentation, or material
1-23     nondisclosures in connection with:
1-24                 (1)  filing an insurance claim; or
 2-1                 (2)  making a claim against any individual or any
 2-2     business, governmental, or other entity if indemnification by a
 2-3     liability insurance policy of the individual or entity is
 2-4     contemplated.
 2-5           (c)  A person who collects, compiles, or furnishes to or
 2-6     exchanges with another person information described by Subsection
 2-7     (b) of this article is not liable in a civil action or subject to
 2-8     criminal prosecution because of that action. This subsection does
 2-9     not apply if the person acts with malice or with the intent to
2-10     defraud.
2-11           SECTION 2.  This Act takes effect September 1, 2001.
2-12                          COMMITTEE AMENDMENT NO. 1
2-13           Amend H.B. 338 as follows:
2-14           (1)  On page 1, strike lines 13 and 14
2-15           (2)  On page 1, line 19, strike "to the extent the person"
2-16     and substitute "only to the extent that"
2-17           (3)  On page 1, line 21, strike "considers" and substitute
2-18     "is"
2-19           (4)  On page 2, Subsection (c), add at the end the following:
2-20     "Nothing in this subsection shall be construed so as to prevent a
2-21     civil action against, or criminal prosecution of a person for
2-22     misuse of information furnished, exchanged, collected, or compiled,
2-23     as outlined in Subsection (b) of this article."
2-24                                                                   Olivo