BILL ANALYSIS |
C.S.H.B. 1810 |
By: Lucio III |
Insurance |
Committee Report (Substituted) |
BACKGROUND AND PURPOSE
Automobile insurance providers currently are allowed to exclude from liability coverage drivers who are given permission to drive an insured vehicle by the policyholder, an exclusion commonly referred to as a "permissive driver exclusion." Interested parties contend that, in addition to being inconvenient, permissive driver exclusions effectively lead to the practice of driving a motor vehicle without financial responsibility. C.S.H.B. 1810 seeks to ameliorate the state's uninsured driver problem by amending state law relating to permissive driver exclusions and specifically named driver exclusions.
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RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
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ANALYSIS
C.S.H.B. 1810 amends the Insurance Code to prohibit an insurer writing personal automobile liability insurance in Texas from using a permissive driver exclusion for a personal automobile liability insurance policy delivered, issued for delivery, or renewed in Texas. The bill requires an agent or insurer, before accepting any premium or fee for a policy with a specifically named driver exclusion, to make a written disclosure to the applicant or insured specifying that the policy does not provide coverage for individuals specifically named as excluded from coverage. The bill requires an agent or insurer that delivers or issues for delivery a policy in Texas with a specifically named driver exclusion to specifically include the required disclosure in the policy and to conspicuously identify that disclosure on the front of any proof of insurance document issued to the insured. The bill defines "permissive driver exclusion" as a provision or endorsement of a personal automobile liability insurance policy that excludes from coverage under the policy drivers who do not reside in the insured's household and who receive permission from the insured to drive the insured's vehicle. The bill does not include in that term a provision or endorsement of a personal automobile liability insurance policy that excludes from coverage specific named persons or family members and residents of the insured's household who are not listed as authorized drivers in a provision or endorsement of the policy. The bill defines "specifically named driver exclusion" as a provision or endorsement of a personal automobile liability insurance policy that excludes specific named persons from coverage under the policy.
C.S.H.B. 1810 amends the Transportation Code to make conforming changes.
C.S.H.B. 1810 applies only to a personal automobile liability insurance policy that is delivered, issued for delivery, or renewed on or after January 1, 2014.
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EFFECTIVE DATE
September 1, 2013.
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COMPARISON OF ORIGINAL AND SUBSTITUTE
While C.S.H.B. 1810 may differ from the original in minor or nonsubstantive ways, the following comparison is organized and highlighted in a manner that indicates the substantial differences between the introduced and committee substitute versions of the bill.
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