83R10497 AJA-D
By: Smithee H.B. No. 2956
A BILL TO BE ENTITLED
AN ACT
relating to certain binding arbitration provisions in certain
insurance and health benefit plan coverage documents.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 1271, Insurance Code, is
amended by adding Section 1271.058 to read as follows:
Sec. 1271.058. PRE-DISPUTE BINDING ARBITRATION CLAUSE
PROHIBITED. (a) An evidence of coverage may not contain a provision
that requires the enrollee to arbitrate a controversy that arises
between the health maintenance organization or other entity
described by Section 1271.002(c) and the enrollee.
(b) This section does not prohibit an agreement between a
health maintenance organization and an enrollee to arbitrate a
controversy that exists at the time of the agreement.
SECTION 2. Subchapter B, Chapter 1701, Insurance Code, is
amended by adding Section 1701.063 to read as follows:
Sec. 1701.063. PRE-DISPUTE BINDING ARBITRATION CLAUSE
PROHIBITED. (a) An insurer may not use a document described by
Section 1701.002 if the document contains a provision that requires
the insured to arbitrate a controversy that arises between the
insurer and the insured.
(b) This section does not prohibit an agreement between an
insurer and insured to arbitrate a controversy that exists at the
time of the agreement.
SECTION 3. Subchapter B, Chapter 2301, Insurance Code, is
amended by adding Section 2301.0541 to read as follows:
Sec. 2301.0541. PRE-DISPUTE BINDING ARBITRATION CLAUSE
PROHIBITED. (a) Except as provided by Subsection (c), an insurer
may not use a form for personal automobile or residential property
insurance if the form contains a provision that requires the
insured to arbitrate a controversy that arises between the insurer
and the insured.
(b) This section does not prohibit an agreement between an
insurer and insured to arbitrate a controversy that exists at the
time of the agreement.
(c) This section does not apply to a binding arbitration
endorsement under Section 2210.554.
SECTION 4. Chapter 3501, Insurance Code, is amended by
adding Section 3501.004 to read as follows:
Sec. 3501.004. PRE-DISPUTE BINDING ARBITRATION CLAUSE
PROHIBITED. (a) An insurer may not use a form for credit
involuntary unemployment insurance if the form contains a provision
that requires the insured to arbitrate a controversy that arises
between the insurer and the insured.
(b) This section does not prohibit an agreement between an
insurer and insured to arbitrate a controversy that exists at the
time of the agreement.
SECTION 5. Subchapter C, Chapter 3502, Insurance Code, is
amended by adding Section 3502.1061 to read as follows:
Sec. 3502.1061. PRE-DISPUTE BINDING ARBITRATION CLAUSE
PROHIBITED. (a) An insurer may not use a form for mortgage
guaranty insurance if the form contains a provision that requires
the insured to arbitrate a controversy that arises between the
insurer and the insured.
(b) This section does not prohibit an agreement between an
insurer and insured to arbitrate a controversy that exists at the
time of the agreement.
SECTION 6. The change in law made by this Act applies only
to a policy, contract, certificate, evidence of coverage, rider, or
endorsement delivered, issued for delivery, or renewed on or after
January 1, 2014. A policy, contract, certificate, evidence of
coverage, rider, or endorsement delivered, issued for delivery, or
renewed before January 1, 2014, is governed by the law applicable to
the policy, contract, certificate, evidence of coverage, rider, or
endorsement immediately before the effective date of this Act, and
that law is continued in effect for that purpose.
SECTION 7. This Act takes effect September 1, 2013.