79R5646 DLF-D

By:  Villarreal                                                   H.B. No. 1103



A BILL TO BE ENTITLED

AN ACT

relating to liability insurance for certain child-care facilities 
and child-placing agencies.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Article 21.49-3, Insurance Code,  is amended by 
adding Section 3C to read as follows:
	Sec. 3C. ELIGIBILITY OF CERTAIN CHILD-CARE FACILITIES AND 
CHILD-PLACING ENTITIES. (a) A nonprofit child-care facility or 
child-placing agency is entitled to receive coverage under this 
article if the facility or agency:
		(1)  is licensed under Chapter 42, Human Resources 
Code;             
		(2)  is accredited by a national accreditation agency, 
such as the Joint Commission on Accreditation of Healthcare 
Organizations or the Council on Accreditation, in accordance with 
rules adopted by the executive commissioner of the Health and Human 
Services Commission; and
		(3)  contracts with the Department of Family and 
Protective Services to provide services to children in foster care 
and those children represent not less than 25 percent of the total 
number of children served annually by the facility or agency.
	(b)  The association shall provide liability insurance 
coverage under this section in a form and in at least the amounts 
sufficient to satisfy the requirements of Section 42.049, Human 
Resources Code. The insurance coverage provided may, in accordance 
with the plan of operation, include additional related liability 
coverages necessary or advisable for the operations of the facility 
or agency.
	(c)  A nonprofit child-care facility or child-placing agency 
that obtains liability insurance coverage under this section  has a 
contingent liability as described by Section 5 of this article and 
is subject to assessment under that section. The facility or agency 
participates in a policyholder's stabilization reserve fund under 
Section 4A or 4B of this article or under a separate policyholder's 
reserve fund, as determined by order of the commissioner. A 
separate policyholder's stabilization reserve fund established by 
order of the commissioner under this subsection operates in the 
same manner as a stabilization reserve fund created under Section 
4B of this article.
	(d)  Except as provided by Subsection (e) of this section, a 
liability insurance policy issued to a nonprofit child-care 
facility or child-placing agency under this section is issued in 
the same manner and subject to the same procedures as a medical 
liability insurance policy issued under this article.
	(e)  The commissioner by rule may provide that a provision of 
this article does not apply to liability insurance issued to a 
nonprofit child-care facility or child-placing agency under this 
section if the commissioner determines that the provision is 
inappropriate to the type of liability insurance provided under 
this section.
	SECTION 2.  Not later than December 31, 2006, the board of 
directors of the joint underwriting association established under 
Article 21.49-3, Insurance Code,  shall propose to the commissioner 
of insurance amendments to the association's plan of operation 
necessary to implement Section 3C, Article 21.49-3, Insurance Code, 
as added by this Act.
	SECTION 3.  Not later than March 1, 2006, the joint 
underwriting association established under Article 21.49-3, 
Insurance Code, shall offer the liability coverage required under 
Section 3C, Article 21.49-3, Insurance Code, as added by this Act.
	SECTION 4.  This Act takes effect September 1, 2005.