Texas Senate Bill SB1125

Texas 2013 - 83rd Regular

Caption

Relating to first-party indemnity coverage purchased by insurance purchasing groups.

Impact

The inclusion of first-party indemnity coverage reflects a strategic shift in how these purchasing groups can protect their members. By permitting this extra layer of coverage, SB1125 aims to ensure that employees within these political subdivisions are better protected from risks beyond the liability coverage they previously had. The limit of three percent of the per member coverage for indemnity relative to liability coverage ensures that the costs remain manageable while still enhancing risk management for these groups.

Summary

SB1125 addresses first-party indemnity coverage for insurance purchasing groups, specifically focusing on those composed primarily of employees from political subdivisions such as counties, municipalities, and school districts. The bill allows these groups to purchase additional indemnity coverage alongside their existing liability insurance. This is designed to provide extra protection against various risks that may be faced by group members, thereby enhancing their overall insurance options.

Contention

While the bill is largely seen as a positive step for employees of political subdivisions, some might argue about the implications of introducing such coverage. Concerns could arise regarding the financial responsibilities of these groups, particularly if the indemnity coverage leads to increasing premiums or if the groups face challenges in managing the additional policies. The requirement for groups to notify the commissioner about their intent to purchase this coverage also raises questions about regulatory oversight and compliance.

Last_action

SB1125 was reported in the House on May 17, 2013, passing with no opposition, suggesting strong bipartisan support for the provisions introduced within the bill.