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A BILL TO BE ENTITLED
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AN ACT
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relating to subrogation rights of certain insurers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 7, Subtitle E, Insurance Code, is amended |
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to add Chapter 1371 to read as follows: |
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Sec. 1371.001. APPLICABILITY OF CHAPTER. (a) This chapter |
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applies to any individual or group health or accident benefit plan |
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or policy that is delivered or issued for delivery in this state or |
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that insures any individual or group in this state. |
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(b) This chapter applies to any benefit plan exempted under |
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29 U.S.C. Sec. 1003(b), to the extent allowed by law. |
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Sec. 1371.002. SUBROGATION. (a) A policy or plan must |
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provide that any right of recovery from third parties on the part of |
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the insurer, whether by subrogation, assignment or reimbursement, |
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is subordinate to the insured's right to be fully compensated for |
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his damages. |
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(b) A policy or plan must provide that the insurer is |
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obligated to share the legal expenses incurred in obtaining any |
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recovery, to the extent the insurer shares in that recovery. |
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(c) No right of recovery may be pursued against the |
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insured's first party recovery. |
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SECTION 2. This Act applies only to an action commenced on |
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or after the effective date of this Act. An action that is |
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commenced before the effective date of this Act is governed by the |
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law applicable to the action immediately before the effective date |
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of this Act, and that law is continued in effect for that purpose. |
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SECTION 3. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2009. |