HBA-KMH H.B. 249 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 249 By: Puente Insurance 1/22/1999 Introduced BACKGROUND AND PURPOSE Currently, it is the practice of some insurance companies to require a third party claimant to make a statement of facts to the insurance company as a condition of the insurance company determining whether to pay or settle a claim regarding motor vehicle insurance. Many of the same insurance companies also refuse to make the insured available to the third party claimant for a similar statement. H.B. 249 requires an insurance company to make the insured or the insured's statement available to a third party claimant if the insurance company requires a statement before making its determination of whether to pay or settle an automobile insurance claim. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Subchapter A, Chapter 5, Insurance Code, by adding Article 5.06-7, as follows: Art. 5.06-7. SETTLEMENT OF CLAIM; REQUIRED STATEMENT OF FACTS. (a) Defines "insurer" to mean an insurance company, interinsurance exchange, mutual, capital stock company, fraternal benefit society, local mutual aid association, county mutual, reciprocal, association, Lloyd's plan, or other entity writing motor vehicle insurance in this state, including affiliates as defined by Section 2, Article 21.49-1. Affiliate is defined as a specific person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified. (b) Prohibits an insurer from requiring a third party claimant to give a statement of the facts relating to a motor vehicle insurance claim as a condition of determining whether to pay or settle the claim unless the insurer's insured reciprocates in like form with the third party claimant. Restricts application of this section if the insured is unable to give a statement for a reason outside the insurer's control. SECTION 2. Effective date: September 1, 1999. Makes application of this Act prospective. SECTION 3. Emergency clause.