Texas 2025 - 89th Regular

Texas House Bill HB4877 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	89R16206 SCR-F
2	2	By: Paul H.B. No. 4877
3	3
4	4
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to the Texas Property and Casualty Insurance Guaranty
10	10	Association.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Section 462.004(4), Insurance Code, is amended
13	13	to read as follows:
14	14	(4) "Claimant" means an insured making a first-party
15	15	claim, [or] a person instituting a liability claim, or a workers'
16	16	compensation claimant.
17	17	SECTION 2. Section 462.007(b), Insurance Code, is amended
18	18	to read as follows:
19	19	(b) Except as provided by Subchapter F, this chapter does
20	20	not apply to:
21	21	(1) life, annuity, health, or disability insurance;
22	22	(2) mortgage guaranty, financial guaranty, or other
23	23	kinds of insurance offering protection against investment risks;
24	24	(3) a fidelity or surety bond, or any other bonding
25	25	obligation;
26	26	(4) credit insurance, guaranteed asset protection
27	27	insurance that protects a lender's or borrower's interest if the
28	28	amount owed on an asset exceeds its value, vendors' single-interest
29	29	insurance, collateral protection insurance, or similar insurance
30	30	protecting a creditor's interest arising out of a creditor-debtor
31	31	transaction;
32	32	(5) insurance of warranties or service contracts;
33	33	(6) title insurance;
34	34	(7) ocean marine insurance;
35	35	(8) a transaction or combination of transactions
36	36	between a person, including an affiliate of the person, and an
37	37	insurer, including an affiliate of the insurer, that involves the
38	38	transfer of investment or credit risk unaccompanied by the transfer
39	39	of insurance risk, including transactions, except for workers'
40	40	compensation insurance, involving captive insurers, policies in
41	41	which deductible or self-insured retention is substantially equal
42	42	in amount to the limit of the liability under the policy, and
43	43	transactions in which the insured retains a substantial portion of
44	44	the risk; or
45	45	(9) insurance provided by or guaranteed by government.
46	46	SECTION 3. Section 462.017(b), Insurance Code, is amended
47	47	to read as follows:
48	48	(b) Venue in a suit by or against the commissioner or
49	49	association [relating to an action or ruling of the commissioner or
50	50	association] under this chapter is in Travis County. The
51	51	commissioner or association is not required to give an appeal bond
52	52	in an appeal of a cause of action arising under this chapter.
53	53	SECTION 4. Section 462.054, Insurance Code, is amended to
54	54	read as follows:
55	55	Sec. 462.054. ELIGIBILITY TO SERVE AS INDUSTRY
56	56	REPRESENTATIVE. To be eligible to serve as an insurance industry
57	57	board member, an individual must be an officer or a full-time
58	58	employee of a member insurer or affiliated entity.
59	59	SECTION 5. Section 462.105, Insurance Code, is amended to
60	60	read as follows:
61	61	Sec. 462.105. ACCOUNTS. For purposes of administration and
62	62	assessment, the association maintains the following four accounts
63	63	[is divided into]:
64	64	(1) the administrative account;
65	65	(2) the workers' compensation insurance account;
66	66	(3) [(2)] the automobile insurance account; and
67	67	(4) [(3)] the account for all other lines of insurance
68	68	to which this chapter applies.
69	69	SECTION 6. Section 462.156(a), Insurance Code, is amended
70	70	to read as follows:
71	71	(a) The amounts provided under assessments made under this
72	72	chapter supplement the marshalling of assets by the receiver under
73	73	Chapter 443 [442] to make payments on the impaired insurer's
74	74	behalf.
75	75	SECTION 7. Sections 462.308(a), (b), and (c), Insurance
76	76	Code, are amended to read as follows:
77	77	(a) The association is entitled to recover:
78	78	(1) the amount of a covered claim and the cost of
79	79	defense paid on behalf of a person:
80	80	(A) who is an affiliate of the impaired insurer;
81	81	and
82	82	(B) whose liability obligations to other persons
83	83	are satisfied wholly or partly by payment made under this chapter;
84	84	[and]
85	85	(2) the amount of a covered claim for workers'
86	86	compensation insurance benefits and the costs of administration and
87	87	defense of the claim paid under this chapter from an insured
88	88	employer or any successor entity to the insured employer under
89	89	state, federal, or international law whose net worth on December 31
90	90	of the year preceding the date the insurer becomes an impaired
91	91	insurer exceeds $50 million; and
92	92	(3) the amount paid under any policy, including the
93	93	costs of administration and defense of the claim, from an insured or
94	94	any successor entity excluded by Section 462.212(a) before the
95	95	insured's identification as an insured whose net worth on December
96	96	31 of the year preceding the date the insurer became an impaired
97	97	insurer exceeds $50 million.
98	98	(b) The association is not entitled to recover under
99	99	Subsection (a)(2) or (3) against an insured who is exempt from
100	100	federal income tax under Section 501(a), Internal Revenue Code of
101	101	1986, by being described by Section 501(c)(3) of that code.
102	102	(c) For purposes of Subsections [Subsection] (a)(2) and
103	103	(3), an insured's net worth is deemed to include the aggregate net
104	104	worth of the insured and of the insured's parent, subsidiary, and
105	105	affiliated companies computed on a consolidated basis.
106	106	SECTION 8. Section 462.309(a), Insurance Code, is amended
107	107	to read as follows:
108	108	(a) To permit the association to properly defend a pending
109	109	cause of action, a proceeding in which an impaired insurer is a
110	110	party or is obligated to defend a party or asserted directly against
111	111	the association arising out of a policy issued by the impaired
112	112	insurer in a court in this state, other than a proceeding directly
113	113	related to the receivership or instituted by the receiver, is
114	114	stayed for:
115	115	(1) a six-month period beginning on the later of the
116	116	date of the designation of impairment or the date an ancillary
117	117	proceeding is brought in this state; and
118	118	(2) a subsequent period as determined by the court, if
119	119	any.
120	120	SECTION 9. Except as provided by this section, the changes
121	121	in law made by this Act apply only with respect to a property and
122	122	casualty insurance company that is designated as an impaired
123	123	insurer on or after the effective date of this Act. The law as it
124	124	existed immediately before the effective date of this Act applies
125	125	with respect to a property and casualty insurance company that is
126	126	designated as an impaired insurer before the effective date of this
127	127	Act, and that law is continued in effect for that purpose.
128	128	SECTION 10. This Act takes effect September 1, 2025.