By Tillery                                            H.B. No. 3456
         77R6276 DLF-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to settlement of certain claims under a motor vehicle
 1-3     insurance policy.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Subchapter A, Chapter 5, Insurance Code, is
 1-6     amended by adding Article 5.07-8 to read as follows:
 1-7           Art. 5.07-8.  SETTLEMENT OF CERTAIN CLAIMS UNDER MOTOR
 1-8     VEHICLE INSURANCE POLICY; PROHIBITED CONDUCT RELATED TO PREVIOUS
 1-9     CLAIMS. (a)  This article applies to a motor vehicle insurance
1-10     policy issued by any entity described by Article 5.01(a) of this
1-11     code.
1-12           (b)  This article applies to a settlement of an insured's
1-13     claim for damage to or destruction of a motor vehicle under a motor
1-14     vehicle insurance policy only if:
1-15                 (1)  the motor vehicle that is the subject of the claim
1-16     had been damaged before the accident that resulted in the claim;
1-17     and
1-18                 (2)  the previous damage to the motor vehicle was the
1-19     subject of a claim made by the same insured to the same insurer.
1-20           (c)  The insurer may not reduce the amount payable for damage
1-21     to the motor vehicle for any reduction in the value of the motor
1-22     vehicle attributable to the previous damage to the motor vehicle
1-23     unless any amount paid by the insurer to the insured for the
1-24     previous claim included payment for that reduction in value.
 2-1           (d)  An insurer that violates this article commits an unfair
 2-2     settlement practice for purposes of Article 21.21 of this code and
 2-3     an unfair claim settlement practice for purposes of Article 21.21-2
 2-4     of this code.
 2-5           SECTION 2. This Act takes effect September 1, 2001, and
 2-6     applies only to an insurance policy that is delivered, issued for
 2-7     delivery, or renewed on or after January 1, 2002.  A policy that is
 2-8     delivered, issued for delivery, or renewed before January 1, 2002,
 2-9     is governed by the law as it existed immediately before the
2-10     effective date of this Act, and that law is continued in effect for
2-11     that purpose.