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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of risk pools primarily consisting of |
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political subdivisions. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle C, Title 5, Local Government Code, is |
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amended by adding Chapter 172A to read as follows: |
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CHAPTER 172A. GENERAL PROVISIONS FOR RISK POOLS PRIMARILY |
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CONSISTING OF POLITICAL SUBDIVISIONS |
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Sec. 172A.001. APPLICABILITY OF CHAPTER. This chapter |
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applies only to a risk pool that primarily consists of political |
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subdivisions. |
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Sec. 172A.002. CONFLICT OF LAWS. To the extent of a |
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conflict between this chapter and other law, this chapter controls. |
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Sec. 172A.003. RULES. The commissioner of insurance may |
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adopt rules to implement this chapter. |
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Sec. 172A.004. APPLICABILITY OF INSURANCE LAWS. The |
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following insurance laws apply to coverage provided by a risk pool |
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subject to this chapter: |
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(1) Title 4, Insurance Code; |
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(2) Subtitle C, Title 5, Insurance Code; and |
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(3) Chapter 830, Insurance Code. |
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Sec. 172A.005. REQUIRED DISCLOSURES. A risk pool that |
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provides health or property and casualty coverage to the members of |
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the pool must annually provide to risk pool members: |
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(1) a written disclosure that the risk pool is not |
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insurance and is not regulated in the same manner as insurers |
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providing similar coverage; |
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(2) a copy of the declarations page of the coverage |
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provided under the risk pool that: |
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(A) lists and identifies each type of coverage |
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provided under the risk pool; and |
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(B) describes the process for filing claims and |
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appeals; |
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(3) a copy of the risk pool's budget for the preceding |
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risk pool year; |
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(4) a report stating the financial status of the risk |
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pool; and |
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(5) a report with a written explanation of each claim |
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denial made by the risk pool in the preceding risk pool year. |
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Sec. 172A.006. ENFORCEMENT. (a) The commissioner of |
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insurance and the Texas Department of Insurance may enforce this |
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chapter against a risk pool in the same manner as the department |
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enforces an insurance law against an insurer under Subtitle B, |
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Title 2, Insurance Code. |
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(b) A person may bring an action against a risk pool in |
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accordance with a law authorizing a private action under Subtitle |
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C, Title 5, Insurance Code. Governmental immunity of a risk pool to |
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suit and from liability is waived to the extent of liability created |
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by this subsection. |
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SECTION 2. Section 172A.004, Local Government Code, as |
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added by this Act, applies only to a contract entered into on or |
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after January 1, 2026. |
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SECTION 3. This Act takes effect September 1, 2025. |