Texas 2021 - 87th Regular

Texas Senate Bill SB1538 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	By: Menéndez, Alvarado, Campbell S.B. No. 1538
	1	+	By: Menéndez, Campbell S.B. No. 1538
	2	+	(In the Senate - Filed March 11, 2021; March 24, 2021, read
	3	+	first time and referred to Committee on Business & Commerce;
	4	+	April 23, 2021, reported adversely, with favorable Committee
	5	+	Substitute by the following vote: Yeas 9, Nays 0; April 23, 2021,
	6	+	sent to printer.)
	7	+	Click here to see the committee vote
	8	+	COMMITTEE SUBSTITUTE FOR S.B. No. 1538 By: Hancock
2	9
3	10
4	11		A BILL TO BE ENTITLED
5	12		AN ACT
6	13		relating to insurer restrictions and duties regarding repair of a
7	14		motor vehicle covered under an insurance policy.
8	15		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	16		SECTION 1. Section 1952.301, Insurance Code, is amended to
10	17		read as follows:
11	18		Sec. 1952.301. LIMITATIONS AND DUTIES REGARDING REPAIR OF
12	19		MOTOR VEHICLE [LIMITATION ON PARTS, PRODUCTS, OR REPAIR PERSONS OR
13	20		FACILITIES PROHIBITED]. (a) In this section:
14	21		(1) "New motor vehicle" has the meaning assigned by
15	22		Section 2301.002, Occupations Code.
16	23		(2) "Non-original equipment" means a part, product, or
17	24		repair process used in the repair of a motor vehicle that is not
18	25		made by or for or used by that vehicle's manufacturer or
19	26		distributor.
20	27		(b) Under an automobile insurance policy that is delivered,
21	28		issued for delivery, or renewed in this state, for damage to a motor
22	29		vehicle that has been owned by the insured for 36 months or less and
23	30		that was a new motor vehicle when delivered to the insured, the
24	31		insurer:
25	32		(1) shall require that a part, product, or repair
26	33		process used to repair the vehicle be the original equipment
27	34		manufacturer's or distributor's part, product, or repair process,
28	35		unless the insured opts to use non-original equipment in accordance
29	36		with Subsection (f); and
30	37		(2) may not limit the beneficiary of the policy from
31	38		selecting a repair person or facility to repair damage to the
32	39		vehicle.
33	40		(c) Under [Except as provided by rules adopted by the
34	41		commissioner, under] an automobile insurance policy that is
35	42		delivered, issued for delivery, or renewed in this state, an
36	43		insurer may not directly or indirectly limit the insurer's coverage
37	44		under a policy covering damage to a motor vehicle that has been
38	45		owned by the insured for more than 36 months by:
39	46		(1) specifying the brand, type, kind, age, vendor,
40	47		supplier, or condition of parts or products or the repair process
41	48		that may be used to repair the vehicle; or
42	49		(2) limiting the beneficiary of the policy from
43	50		selecting a repair person or facility to repair damage to the
44	51		vehicle.
45	52		(d) In settling a liability claim by a third party against
46	53		an insured for property damage claimed by the third party for damage
47	54		to the third party's motor vehicle that has been owned by the third
48	55		party for 36 months or less and that was a new motor vehicle when
49	56		delivered to the third party, an insurer:
50	57		(1) shall require that a part, product, or repair
51	58		process used to repair the vehicle be the original equipment
52	59		manufacturer's or distributor's part, product, or repair process,
53	60		unless the third-party claimant opts to use non-original equipment
54	61		in accordance with Subsection (f); and
55	62		(2) may not require the third-party claimant to use a
56	63		particular repair person or facility to repair damage to the
57	64		vehicle.
58	65		(e) [(b)] In settling a liability claim by a third party
59	66		against an insured for property damage claimed by the third party to
60	67		a motor vehicle that has been owned by the insured for more than 36
61	68		months, an insurer may not require the third-party claimant to have
62	69		the motor vehicle repairs made by a particular repair person or
63	70		facility or to use a particular brand, type, kind, age, vendor,
64	71		supplier, or condition of parts or products or a particular repair
65	72		process.
66	73		(f) An insured or third-party claimant may opt to accept the
67	74		use of non-original equipment in the repair of the insured's or
68	75		claimant's motor vehicle by signing a written disclosure. The
69	76		disclosure must:
70	77		(1) be signed before repair of the vehicle begins;
71	78		(2) be delivered as an attachment to a written
72	79		estimate provided for the repair of the vehicle;
73	80		(3) be written in at least a 12-point font; and
74	81		(4) include the following language:
75	82		"I am opting to accept the use of a non-original equipment
76	83		manufacturer's or distributor's part, product, or repair process in
77	84		the repair of my vehicle, and I understand and agree that:
78	85		1. the attached repair estimate is based on the use of
79	86		a non-original equipment manufacturer's or distributor's part,
80	87		product, or repair process that is supplied by a manufacturer or
81	88		distributor that is not my motor vehicle's manufacturer or
82	89		distributor; and
83	90		2. the warranty for the non-original equipment
84	91		manufacturer's or distributor's part, product, or repair process is
85	92		provided by the manufacturer or distributor of that part, product,
86	93		or repair process and not by my motor vehicle's manufacturer or
87	94		distributor."
88	95		(g) An insurer that delivers, issues for delivery, or renews
89	96		an automobile insurance policy in this state may not require or
90	97		request that a repair person or facility use any specific
91	98		percentage of non-original equipment in the repair of a motor
92	99		vehicle.
93	100		SECTION 2. The change in law made by this Act applies only
94	101		to an insurance policy that is delivered, issued for delivery, or
95	102		renewed on or after January 1, 2022. A policy delivered, issued for
96	103		delivery, or renewed before that date is governed by the law as it
97	104		existed immediately before the effective date of this Act, and that
98	105		law is continued in effect for that purpose.
99	106		SECTION 3. This Act takes effect September 1, 2021.
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