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A BILL TO BE ENTITLED
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AN ACT
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relating to enforcement of certain insurance provisions in and |
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related to construction contracts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle A, Title 10, Insurance Code, is amended |
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by adding Chapter 1808 to read as follows: |
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CHAPTER 1808. INSURANCE AND RISK TRANSFER AGREEMENTS IN CERTAIN |
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CONSTRUCTION CONTRACTS |
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Sec. 1808.001. DEFINITIONS. In this chapter: |
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(1) "Additional insured" means a person covered under |
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another person's insurance policy for an occurrence caused by |
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something other than the sole negligence of the named insured under |
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the policy, or an indemnitor under an indemnification agreement. |
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(2) "Construction contract" means a contract or |
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agreement made or entered into by an owner, contractor, |
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subcontractor, or supplier concerning the construction, |
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alteration, remodeling, repair, or maintenance of a building, |
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structure, appurtenance, or other improvement to or on real |
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property, including moving, demolition, and excavation connected |
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with the real property. |
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(3) "Construction insurance provision" means a |
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covenant, promise, agreement, or understanding contained in a |
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construction contract, or in an agreement collateral to or |
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affecting a construction contract, that: |
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(A) requires a person to provide insurance |
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coverage; |
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(B) provides insurance coverage; or |
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(C) requires insurance coverage for an |
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indemnitee under an indemnification agreement. |
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Sec. 1808.002. CERTAIN INSURANCE PROVISIONS UNENFORCEABLE. |
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(a) A construction insurance provision is void and unenforceable |
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to the extent that the provision requires that: |
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(1) a person, including an indemnitee under an |
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indemnification agreement, be an additional insured; or |
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(2) a workers' compensation insurance policy be |
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endorsed to provide a waiver of subrogation. |
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(b) An insurance policy provision or endorsement that |
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provides for an additional insured or a waiver of subrogation in |
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contravention of this section is void. |
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Sec. 1808.003. WAIVER PROHIBITED. The provisions of this |
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chapter may not be waived by contract or otherwise. |
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Sec. 1808.004. APPLICABILITY OF OTHER LAW. This chapter |
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prevails over any other law that conflicts with or is inconsistent |
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with this chapter. |
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SECTION 2. The changes in law made by this Act apply only to |
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a contract or agreement entered into on or after the effective date |
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of this Act. A contract or agreement entered into before the |
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effective date of this Act is governed by the applicable law in |
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effect immediately before the effective date of this Act, and that |
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law is continued in effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2007. |