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A BILL TO BE ENTITLED
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AN ACT
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relating to regulation of persons holding a certificate of |
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self-insurance for establishment of financial responsibility for |
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operating a motor vehicle. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 601.124, Transportation Code, is amended |
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to read as follows: |
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Sec. 601.124. SELF-INSURANCE. (a) A person in whose name |
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more than 25 motor vehicles are registered may qualify as a |
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self-insurer by obtaining a certificate of self-insurance issued by |
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the Texas Department of Insurance [department] as provided by this |
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section. |
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(b) The Texas Department of Insurance [department] may |
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issue a certificate of self-insurance to a person if: |
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(1) the person applies for the certificate; [and] |
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(2) the person files with the Texas Department of |
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Insurance a bond: |
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(A) in the amount of $10,000; |
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(B) conditioned for payment: |
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(i) in the amounts and under the same |
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circumstances as required under a motor vehicle liability insurance |
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policy; and |
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(ii) in accordance with the claims review |
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procedure under Subsection (c-1) or a court order; |
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(C) that is not cancelable before the sixth day |
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after the date the Texas Department of Insurance receives written |
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notice of the cancellation; and |
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(D) approved by the Texas Department of |
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Insurance; and |
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(3) the commissioner of insurance [department] is |
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satisfied that the person has and will continue to have the ability |
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to pay judgments obtained against the person. |
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(c) The self-insurer must supplement the certificate with |
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an agreement that, for accidents occurring while the certificate is |
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in force, the self-insurer will pay the same judgments within the |
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time and in the same amounts as an insurer would be obligated to pay |
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under an owner's motor vehicle liability insurance policy issued to |
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the self-insurer if such policy were issued. The agreement may |
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include any other requirements that the commissioner of insurance |
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determines are appropriate for ensuring that the self-insurer pays |
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a legitimate claim timely. |
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(c-1) The commissioner of insurance by rule shall establish |
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a claims review procedure under which a claimant may file a motor |
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vehicle collision claim against the self-insurer with the Texas |
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Department of Insurance. If the claimant prevails, the claimant |
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may recover the awarded amount from the bond filed by the |
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self-insurer and the self-insurer shall replenish the bond as |
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necessary for the bond to be in the amount described by Subsection |
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(b)(2)(A). A claim under the procedure is a contested case under |
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Chapter 2001, Government Code. |
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(c-2) Notwithstanding any other law, a person may file suit |
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against the self-insurer by using the self-insurer's assumed name |
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stated on a certificate filed under Chapter 71, Business & Commerce |
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Code, for a cause of action: |
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(1) provided by other law; and |
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(2) arising from a motor vehicle collision: |
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(A) occurring while the certificate is in effect; |
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and |
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(B) in which a motor vehicle registered by the |
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self-insurer is involved. |
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(d) The Texas Department of Insurance [department] for |
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cause, including failure to pay a legitimate claim timely or |
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failure to comply with a requirement imposed by the commissioner of |
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insurance, may cancel a certificate of self-insurance after a |
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hearing. Cause includes failure to pay a judgment before the 31st |
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day after the date the judgment becomes final. |
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(e) A self-insurer must receive at least five days' notice |
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of a hearing held under Subsection (d). The Texas Department of |
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Insurance [department] shall send notice of the hearing to the |
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self-insurer by: |
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(1) first class mail; or |
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(2) e-mail if the self-insurer has provided an e-mail |
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address to the Texas Department of Insurance [department] and has |
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elected to receive notice electronically. |
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(f) The Texas Department of Insurance shall suspend a |
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certificate under Subsection (d) for six months if the self-insurer |
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fails to pay a legitimate claim timely. If the self-insurer |
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subsequently fails to pay a legitimate claim timely, the Texas |
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Department of Insurance shall cancel the certificate. |
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(g) The commissioner of insurance may adopt rules necessary |
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to implement this section. |
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SECTION 2. Section 601.124, Transportation Code, as amended |
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by this Act, applies only to a certificate of self-insurance issued |
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on or after January 1, 2020. A certificate of self-insurance issued |
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before January 1, 2020, is governed by the law applicable to the |
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certificate immediately before the effective date of this Act, and |
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that law is continued in effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2019. |