85R12417 TYPED
By: Goldman H.B. No. 2113
A BILL TO BE ENTITLED
AN ACT
Relating to the regulation of certain companies that provide
for-profit legal service contracts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 953.001, Occupations Code, is amended as
follows:
Sec. 953.001. DEFINITION[S]. In this chapter [:
[(1) "Administrator" means the person responsible for
the administration of a legal service contract. The term includes a
person responsible for any filing required by this chapter.
[(2) "Company" means a person who:
[(A) is contractually obligated to a legal
service contract holder under the terms of a legal service
contract;
[(B) enters into a contract with a contracting
attorney to provide or obtain covered legal services for a legal
service contract holder; and
[(C) operates as a for-profit legal service
contract company.
[(3) "Contracting attorney" means an attorney who has
entered into a contract with a company to provide or obtain covered
legal services for a legal service contract holder.
[(4) "Department" means the Texas Department of
Licensing and Regulation.
[(5) "Executive director" means the executive
director of the Texas Department of Licensing and Regulation or the
executive director's designee.
[(6) "Financial security" means a surety bond, a
certificate of deposit, or any other item approved by the executive
director.
[(7)] "Legal service contract" means an agreement:
(A) that is entered into for a separately stated
consideration; and
(B) under which the company obtains legal
services for a legal service contract holder through a contracting
attorney.
[(8) "Legal service contract holder" means the person
who purchases or otherwise holds a legal service contract or who is
covered under a group legal service contract.
[(9) "Person" means an individual or a partnership,
company, corporation, association, or other private group.
[(10) "Sales representative" means a person who sells
or solicits legal service contracts to a person on behalf of a
company.]
SECTION 2. Sections 953.002 and 953.003, Occupations Code,
are amended as follows:
Sec. 953.002. [EXEMPTIONS. This chapter does not apply to:
[(1) a nonprofit legal services corporation under
Chapter 961, Insurance Code;
[(2) an automobile club supplying services under
Chapter 722, Transportation Code;
[(3) a prepaid legal services program under Chapter
951;
[(4) a lawyer referral service under Chapter 952;
[(5) a retainer contract between an attorney and a
client, and similar contracts made with a group of clients involved
in the same or closely related legal matters; or
[(6) a contingency fee contract between an attorney
and a client.
[Sec. 953.003.] EXEMPTIONS FROM CERTAIN OTHER LAWS.
The acts of marketing, selling, offering for sale, issuing, making,
proposing to make, and administering a legal service contract [that
is regulated by this chapter] are exempt from the Insurance Code and
other laws of this state regulating the business of insurance.
SECTION 3. On the effective date of this Act, the following
provisions of the Occupations Code are repealed:
(1) Section 953.004, Occupations Code;
(2) Section 953.005, Occupations Code;
(3) Subchapter B, Chapter 953, Occupations Code;
(4) Subchapter C, Chapter 953, Occupations Code;
(5) Subchapter D, Chapter 953, Occupations Code; and
(6) Subchapter E, Chapter 953, Occupations Code.
SECTION 4. This Act takes effect September 1, 2018.