81R5882 PB-D

By: West S.B. No. 565

A BILL TO BE ENTITLED

AN ACT

relating to premium discounts for certain vehicles equipped with a tracking system.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subtitle C, Title 10, Insurance Code, is amended by adding Chapter 1954 to read as follows:

CHAPTER 1954. PREMIUM DISCOUNTS FOR AUTOMOBILE INSURANCE COVERAGE

Sec. 1954.001. DEFINITIONS. In this chapter:

(1) "Applicant" includes:

(A) an applicant for new insurance coverage; and

(B) a policyholder renewing insurance coverage.

(2) "Comprehensive coverage" means automobile insurance coverage that covers the cost of replacing or repairing a motor vehicle if the vehicle is stolen or damaged by fire, vandalism, hail, or a cause other than a collision.

(3) "Insurer" means an insurance company, reciprocal or interinsurance exchange, mutual insurance company, capital stock insurance company, county mutual insurance company, Lloyd's plan, or other legal entity authorized to write automobile insurance in this state. The term includes an affiliate, as described by this code, that is authorized to write and is writing automobile insurance in this state.

(4) "Tracking system" means an electronic monitoring system, global positioning satellite system, or other appropriate technological system that is designed to track the location of a motor vehicle.

Sec. 1954.002. REQUIRED PREMIUM DISCOUNT. (a) In accordance with the rules adopted by the commissioner under this chapter, an insurer shall grant to an applicant a discount in the applicant's automobile insurance premiums for comprehensive coverage for a motor vehicle equipped with a tracking system that is designed to assist in the recovery of stolen vehicles. The insurer shall grant the discount on receipt of written verification from the applicant that the vehicle is equipped with such a system.

(b) The commissioner by rule shall prescribe the requirements for determining that a motor vehicle is equipped with an appropriate tracking system.

(c) Verification under this section must comply with the requirements prescribed by the commissioner.

Sec. 1954.003. VEHICLE INSPECTION. (a) If determined necessary by the commissioner, the rules adopted under this chapter may require an inspection of the vehicle to be insured to ensure that the vehicle is equipped with an appropriate tracking system.

(b) The applicant shall pay the costs of an inspection required under this section.

Sec. 1954.004. PREMIUM DISCOUNT; EXCEPTION. (a) The commissioner by rule shall establish the premium discount under this chapter based on sound actuarial principles.

(b) The commissioner may approve a premium discount greater or less than the discount established by rule under Subsection (a) if:

(1) the insurer files the proposed discount with the department; and

(2) the commissioner determines that the proposed discount is actuarially justified.

Sec. 1954.005. GENERAL RULEMAKING AUTHORITY. The commissioner may adopt rules as necessary to implement this chapter in addition to other rules specifically required to be adopted under this chapter.

SECTION 2. The commissioner of insurance shall adopt rules as required by Chapter 1954, Insurance Code, as added by this Act, not later than December 1, 2009.

SECTION 3. This Act applies only to an automobile insurance policy delivered, issued for delivery, or renewed on or after January 1, 2010. A policy delivered, issued for delivery, or renewed before January 1, 2010, is governed by the law as it existed immediately before the effective date of this Act, and that law is continued in effect for that purpose.

SECTION 4. This Act takes effect September 1, 2009.