84R12090 SCL-F
By: Alonzo H.B. No. 3394
A BILL TO BE ENTITLED
AN ACT
relating to a direct action against an insurer and insured by third
parties and required provisions of a liability insurance policy.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 4, Civil Practice and Remedies Code, is
amended by adding Chapter 100B to read as follows:
CHAPTER 100B. THIRD-PARTY LIABILITY OF INSURERS AND INSUREDS
Sec. 100B.001. DEFINITIONS. In this chapter:
(1) "Insured" means an individual who is issued, is a
party to, or is a beneficiary under a liability insurance policy.
(2) "Insurer" means an insurance company or other
entity admitted to engage in business and authorized to write
liability insurance in this state, including a county mutual
insurance company, a Lloyd's plan, and a reciprocal or
interinsurance exchange.
Sec. 100B.002. DIRECT ACTION AGAINST INSURERS AND INSUREDS.
(a) Except as provided by Subsection (c), a third party who is
injured by an insured or is a survivor of an individual who was
injured by the insured may bring an action under this chapter
against the insured and the insured's insurer if the insurer is
liable under the terms of the insured's policy to indemnify the
insured for damages for the injury.
(b) The third party may bring an action under this chapter
only in the county in which the injury occurred or in a county in
which an action may be brought against the insured or insurer under
Chapter 15.
(c) A third party may bring an action under this chapter
against the insurer only if:
(1) the insured has received a discharge in bankruptcy
by a court of competent jurisdiction that is applicable to the third
party's claim or that evidences that the insured is unable to pay
the claim;
(2) at the time the third party brings the action,
bankruptcy proceedings are pending for the insured in a court of
competent jurisdiction;
(3) the insured is insolvent;
(4) service of citation or other process cannot be
made on the insured;
(5) the third party is a child, parent, or spouse of
the insured;
(6) the third party is seeking to recover under the
insured's uninsured or underinsured motorist coverage; or
(7) the insured is deceased.
(d) A third party may bring an action under this chapter
regardless of whether the insured's policy prohibits an action
under this chapter or is written or delivered outside of this state.
Sec. 100B.003. EFFECT ON INSURANCE POLICIES. (a) This
chapter may not be construed to affect the provisions of an
insurance policy if the provisions are not in violation of the laws
of this state.
(b) An action brought under this chapter is subject to the
lawful conditions of the applicable insurance policy and the
defenses which an insurer may raise.
SECTION 2. Subchapter A, Chapter 2301, Insurance Code, is
amended by adding Section 2301.011 to read as follows:
Sec. 2301.011. REQUIRED POLICY PROVISIONS. (a) An insurer
may not deliver or issue for delivery in this state a form for use in
writing liability insurance described by Section 2301.003 unless
the form contains the provisions described by this section.
(b) A form must contain a provision providing that the
insolvency or bankruptcy of the insured does not release the
insurer from the payment of damages for an injury or loss by a third
party for which the insurer is liable under the policy.
(c) A form must contain a provision providing that a
judgment against an insured from which a third party cannot collect
any damages is prima facie evidence of the insured's insolvency and
the third party may bring an action against the insurer within the
terms and limits of the policy against the insurer under Chapter
100B, Civil Practice and Remedies Code.
(d) A form must contain a provision providing that the
purpose of the policy includes:
(1) providing benefits to all injured third parties
and the third parties' survivors to whom the insured is liable; and
(2) providing protection and coverage to each person
insured under the policy, regardless of whether the person is a
named insured or an additional insured, for any legal liability the
person may incur under the terms and limits of the policy.
SECTION 3. The changes in law made by this Act apply only to
an insurance policy delivered, issued for delivery, or renewed on
or after the effective date of this Act. An insurance policy
delivered, issued for delivery, or renewed before the effective
date of this Act 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 4. This Act takes effect September 1, 2015.