2019S0329-1 03/04/19
 
  By: Menéndez S.B. No. 1737
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to continuation of automobile insurance coverage for
  temporary substitute vehicles during a personal automobile
  insurance policy term.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter B, Chapter 1952, Insurance Code, is
  amended by adding Section 1952.060 to read as follows:
         Sec. 1952.060.  REQUIRED PROVISION: LIABILITY COVERAGE FOR
  TEMPORARY SUBSTITUTE VEHICLES DURING POLICY TERM. (a) This
  section applies to an insurer authorized to write automobile
  insurance in this state, including an insurance company, reciprocal
  or interinsurance exchange, mutual insurance company, capital
  stock company, county mutual insurance company, Lloyd's plan, or
  other entity.
         (b)  In this section:
               (1)  "Repair facility" means a person that engages in
  the business of servicing, repairing, or replacing a motor vehicle
  for consideration or in accordance with a warranty, service
  contract, or maintenance contract.
               (2)  "Resident relative" means an individual who:
                     (A)  resides in the same household as the insured;
  and
                     (B)  is related to the insured within the third
  degree by consanguinity or affinity, as determined under Chapter
  573, Government Code.
               (3)  "Temporary substitute vehicle" means a motor
  vehicle that is:
                     (A)  loaned or provided without charge by a repair
  facility to the insured while a vehicle owned by the insured is
  being serviced, repaired, or replaced, including a vehicle loaned
  or provided following the theft of a vehicle owned by the insured;
  and
                     (B)  not owned by the insured, a resident
  relative, or any individual who resides in the same household as the
  insured. 
         (c)  A personal automobile insurance policy must contain a
  provision to provide primary liability coverage in accordance with
  this section for a temporary substitute vehicle during the policy
  term.
         (d)  Coverage under this section is required only for a
  vehicle that is:
               (1)  a private passenger automobile; or
               (2)  a pickup, utility vehicle, or van with a gross
  vehicle weight of 25,000 pounds or less that is not used for the
  delivery or transportation of goods, materials, or supplies, other
  than samples, unless:
                     (A)  the delivery of the goods, materials, or
  supplies is not the primary use for which the vehicle is employed;
  or
                     (B)  the vehicle is used for farming or ranching.
         (e)  Coverage under this section must provide primary, not
  excess, coverage subject to the same financial and territorial
  limits of the policy, including coverage against damage to a
  temporary substitute vehicle and against property damage and bodily
  injury claimed by a third party.
         (f)  Coverage under this section must insure against loss
  from liability for damages arising out of the use of a temporary
  substitute vehicle:
               (1)  by the insured; and
               (2)  unless the policy is a named driver policy under
  Section 1952.0545 that excludes such individuals, by:
                     (A)  a licensed resident relative; and
                     (B)  any other licensed operator using the vehicle
  with the express or implied permission of the insured.
         SECTION 2.  The change in law made by this Act applies only
  to an insurance policy delivered, issued for delivery, or renewed
  on or after January 1, 2020. An insurance policy delivered, issued
  for delivery, or renewed before January 1, 2020, is governed by the
  law in effect immediately before the effective date of this Act, and
  that law is continued in effect for that purpose.
         SECTION 3.  This Act takes effect September 1, 2019.