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78R4436 PB-F

By:  Carona                                                       S.B. No. 435



A BILL TO BE ENTITLED

AN ACT

relating to insurer interests in certain motor vehicle repair 
facilities.   
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subtitle A, Title 14, Occupations Code, is 
amended by adding Chapter 2306 to read as follows:

CHAPTER 2306. INSURER INTERESTS IN REPAIR FACILITIES PROHIBITED
	Sec. 2306.001.  DEFINITIONS.  In this chapter:                          
		(1)  "Insurer" means an insurer authorized by the Texas 
Department of Insurance to  write motor vehicle insurance in this 
state, including a county mutual insurance company, a Lloyd's plan, 
and a reciprocal or interinsurance exchange.  The term includes an 
entity that is an affiliate of an insurer as described by Section 
823.003, Insurance Code.
		(2)  "Repair facility" has the meaning assigned by 
Section 2304.001. 
	Sec. 2306.002.  INTEREST PROHIBITED.   An insurer may not 
hold or acquire any ownership interest in a  repair facility.
	Sec. 2306.003.  ACTION TO COMPEL COMPLIANCE.  (a)  An 
individual aggrieved by a violation of this chapter by an insurer 
may bring an action for injuctive or other appropriate relief to 
compel the insurer to comply with the requirements adopted under 
this chapter.
	(b)  A plaintiff who prevails in an action under this section 
is entitled to recover reasonable attorney's fees and court costs.
	Sec. 2306.004.  DIVESTITURE REQUIREMENTS; DISCLOSURE.  (a)  
An insurer that, on September 1, 2003, has an ownership interest in 
a repair facility must divest itself of any interest in the facility 
not later than September 1, 2005.
	(b)  During the period in which the insurer maintains its 
interest in the repair facility before the divestiture required 
under this section, the insurer shall disclose to each insured that 
the insured has the right to use any repair facility selected by the 
insured.   The insurer shall make the disclosure in writing in the 
manner prescribed by the commissioner of insurance and shall 
provide the disclosure:
		(1)  at the time the policy is delivered, issued for 
delivery, or renewed; and
		(2)  when a claim covered by the policy is reported to 
the insurer by the insured.
	(c)  This section expires December 1, 2005.                             
	SECTION 2.  Chapter 2306, Occupations Code, as added by this 
Act, applies only to an action that is commenced on or after the 
effective date of this Act.  An action that is commenced before the 
effective date of this Act is governed by the law applicable to the 
action immediately before the effective date of this Act, and that 
law is continued in effect for that purpose.
	SECTION 3.  (a)  Except as provided by Subsection (b) of this 
section, this Act takes effect September 1, 2003.
	(b)  Section 2306.003, Occupations Code, as added by this 
Act, takes effect September 1, 2005.