HBA-TYH H.B. 2772 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2772 By: Bonnen Insurance 4/8/1999 Introduced BACKGROUND AND PURPOSE Since 1981, owners of motor vehicles in Texas have been required to purchase an automobile liability insurance policy, or provide other statutorily provided equivalents, in order to legally operate a motor vehicle on Texas roads. The percentage of compliance has remained in the 70 to 80 percentile in spite of various attempts to enhance compliance with the Texas Motor Vehicle Safety Responsibility Acts (financial responsibility law). H.B. 2772 eliminates the current requirements for owners to produce evidence of compliance with the financial responsibility law, such as the requirement to produce an insurance ID card when an owner registers the vehicle, purchases license plates, or has the vehicle inspected. This bill also limits litigation and the awarding of "noneconomic damages" for persons who do not purchase coverage in compliance with the financial responsibility laws. This may provide an incentive for owners of motor vehicles to purchase the statutory minimum limits stated in the financial responsibility law for automobile bodily injury and property damage liability coverage. 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 F, Chapter 601, Transportation Code, as follows: SUBCHAPTER F. New title: LIABILITY FOR MOTOR VEHICLE ACCIDENT Sec. 601.151. DEFINITIONS. Defines "exemplary damages" and "noneconomic damages." Sec. 601.152. LIABILITY FOR INJURY TO CERTAIN OPERATORS. (a) Prohibits a person from obtaining noneconomic damages or exemplary damages in a civil action for bodily injury, death, or damage to or destruction of property arising out of a motor vehicle accident if the person was operating the vehicle while intoxicated or without financial responsibility. (b) Provides that Subsection (a) does not apply to a person driving without financial responsibility if the person was injured by another person who was driving while intoxicated. (c) Provides that except as provided by Subsection (d), Subsection (a) applies to a claim for damages made by a person whose right to recovery derives from an injury to another person whose right to recovery would be barred under Subsection (a), including a claim for wrongful death or for loss of consortium or companionship. (d) Provides that this section does not prohibit the recovery of exemplary damages for a wilful act or omission or gross neglect in a wrongful death action brought by or on behalf of a surviving spouse or heirs of the decedent. Provides that a claim for exemplary damages described by this subsection is governed by Chapter 41 (Exemplary Damages), Civil Practice and Remedies Code. (e) Provides that this section does not prohibit a person described by Subsection (a) from acting in a representative capacity to bring suit on behalf of another person injured in the accident, as next friend or otherwise. Deletes sections relating to applicability of this subchapter, suspension of driver's licence and vehicle registration privilege, department determination of probability of liability, notice of determination, setting of hearing, hearing procedures, appeal, procedures for suspension of driver's licence and vehicle registration or privilege, suspension stayed pending hearing or appeal, notice of suspension, duration of suspension, form of security, reduction in security, custody of cash security, payment of cash security, return of cash security, insurance policy or bond and limits, reasonable probability not admissible in a civil suit, and department action on erroneous information. SECTION 2. Amends Subchapters A, B, and C, Chapter 601, Transportation Code, as follows: SUBCHAPTER A. GENERAL PROVISIONS Sec. 601.001 New title: DEFINITIONS. Deletes text authorizing the chapter to be cited as the Texas Motor Safety Responsibility Act and the definitions "driver's license," "nonresident," and "nonresident's operating privilege." Deletes "short title" from old title. Deletes section relating to judgment and satisfied judgment. Makes conforming changes. Sec. 601.004. ACCIDENT REPORT. Deletes requirement for report to contain specified information. Deletes sections relating to evidence in a civil suit and applicability to certain owners and operators. Sec. 601.005. APPLICABILITY OF CHAPTER TO GOVERNMENT VEHICLES. Redesignated from Section 601.007. Deletes text specifying the sections to which this provision does not apply. Deletes sections relating to violation of chapter, offense, and report from other states or Canada. Makes a conforming change. SUBCHAPTER B. New heading: DEPARTMENT CERTIFICATION OF RECORDS Sec. 601.022. DEPARTMENT TO PROVIDE OPERATING RECORD. Deletes sections relating to the powers and duties of the Department of Public Safety, rules, and payment of statutory fees. SUBCHAPTER C. New heading: FINANCIAL RESPONSIBILITY Sec. 601.051. New title: MANNER OF ESTABLISHING FINANCIAL RESPONSIBILITY. Authorizes a person to establish financial responsibility for a motor vehicle through the enumerated manners, rather than prohibiting a person from operating a motor vehicle in this state unless financial responsibility is established . Authorizes financial responsibility for a motor vehicle subject to Chapter 643 (Motor Carrier Registration) to be established in the manner provided by Section 643.101 (Amount Required) or 643.102 (Self-Insurance). Deletes sections relating to exceptions to financial responsibility requirement, evidence of financial responsibility, authority to provide evidence of financial responsibility for others, substitution of evidence of financial responsibility, cancellation, return, waiver of evidence of financial responsibility, evidence not fulfilling requirements, and suspension. Makes conforming changes SECTION 3. Amends Section 601.071, Transportation Code, to provide that Subsection (a)(1) does not apply to a policy that is written to or for the benefit of a person who is not a resident of this state. Subsection (a)(1) states that a motor vehicle liability insurance policy must be an owner's or operator's policy that is issued by an insurance company authorized to write motor vehicle liability insurance. Makes conforming changes. SECTION 4. Amends the heading of Subtitle D, Title 7, Transportation Code, as follows: SUBTITLE D. New heading: FINANCIAL RESPONSIBILITY SECTION 5. Amends the heading of Chapter 601, Transportation Code, as follows: CHAPTER 601. New heading: FINANCIAL RESPONSIBILITY; LIABILITY FOR MOTOR VEHICLE ACCIDENTS SECTION 6. Amends Section 502.352(c), Transportation Code, to authorize a person to obtain a permit by furnishing evidence that financial responsibility for the vehicle has been established that complies with Subchapter D (Establishment of Financial Responsibility Through Motor Vehicle Liability Insurance), Chapter 601, rather than Sections 502.153(c) (Evidence of Financial Responsibility) and 601.168(a) (Insurance Policy or Bond; Limits), and is written by an insurance company or surety company authorized to write motor vehicle liability insurance in this state. Makes a conforming change. SECTION 7. Amends Section 502.353(d), Transportation Code, to make conforming changes. SECTION 8. Amends Section 502.355(c), Transportation Code, to delete text regarding furnishing satisfactory evidence of specified motor vehicle insurance in accordance with Section 601.072 (Minimum Coverage Amounts). Makes a conforming change. SECTION 9. Amends Section 521.244(c), Transportation Code, to delete text requiring a petitioner to provide evidence of financial responsibility in accordance with Chapter 601. Makes conforming changes. SECTION 10. Amends Section 521.249(b), Transportation Code, to make a conforming change. SECTION 11. Amends Section 521.457(f), Transportation Code, to refer to Section 601.371(a) (Operation of Motor Vehicle in Violation of Suspension; Offense), as it existed before its repeal effective January 1, 2000. SECTION 12. Amends Section 522.092, Transportation Code, to make conforming changes. SECTION 13. Amends Section 543.103(b), Transportation Code, to make conforming changes. SECTION 14. Amends Section 600.002, Transportation Code, to delete a reference made to Chapter 497, Acts of the 73rd Legislature, Regular Session, 1993, and to make a conforming change. SECTION 15. Amends Section 729.001(a), Transportation Code, to make conforming changes. SECTION 16. Amends Section 84.004(c), Civil Practice and Remedies Code, to provide that a volunteer is liable to a person for death, damage, or injury to the person or his property proximately caused by an act or omission arising from the operation or use of any motor-driven equipment, to the extent, for a motor vehicle, of the limits of liability required to establish financial responsibility under Section 601.072, Transportation Code, rather than to the extent insurance coverage is required by Chapter 601. Makes conforming changes. SECTION 17. Amends Section 61.096(b), Human Resources Code, to make conforming changes. SECTION 18. Amends Section 612.001(b), Government Code, to make conforming changes. SECTION 19. Amends Section 2001.221, Government Code, to make conforming changes. SECTION 20. Amends Section 2002.023, Government Code, to make conforming changes. SECTION 21. Amends Section 142.006(c), Local Government Code, to make conforming changes. SECTION 22. Amends Section 157.042(d), Local Government Code, to make conforming changes. SECTION 23. Amends Section 113.097(d), Transportation Code, to make conforming changes. SECTION 24. Amends Section Article 5.01-1, Insurance Code, to establish applicability of this article to Article 21.81 (Texas Automobile Insurance Plan Association) and Subtitle C (Rules of the Road), Title 7, Transportation Code, rather than Section 35 (Assigned Risk Plan), Article 6701h (Texas Motor Vehicle Safety Responsibility Act), V.T.C.S., and Article 6701d (Uniform Act Regulating Traffic on Highways), V.T.C.S. SECTION 25. Amends Subsection (1), Article 5.06-1, Insurance Code, to establish that the referenced automobile liability insurance is subject to limits prescribed by the commissioner of insurance, rather than the State Board of Insurance and to make conforming changes. SECTION 26. Amends Article 5.06-2(1), Insurance Code, to make conforming changes. SECTION 27. Amends Article 5.06-3(a), Insurance Code, to make a conforming change. SECTION 28. Amends Section 1(3), Article 21.81, Insurance Code, to make conforming changes. SECTION 29. Amends Section 4(a), Article 21.81, Insurance Code, to require the association to provide a means by which insurance may be assigned to an authorized insurance company for a person who is eligible for insurance under this article, rather than a person required to show proof of financial responsibility as required by the Texas Motor Vehicle Safety Responsibility Act. SECTION 30. Amends Section 3(d), Article 21.81, Insurance Code, to make a conforming change. SECTION 31. Repealer: (1) Sections 502.153 (Evidence of Financial Responsibility), 521.143 (Evidence of Financial Responsibility Required), 548.105 (Evidence of Financial Responsibility as Prerequisite to Issuance of Inspection Certificate), 601.081 (Standard Proof of Motor Vehicle Liability Insurance Form), 601.082 (Motor Vehicle Liability Insurance; Certification), 601.083 (Certificate of Motor Vehicle Liability Insurance), 601.084 (Nonresident Certificate), 601.085 (Termination of Certified Policy), 601.086 (Response of Insurance Company if Policy Not in Effect), 601.087 (Governmental Record; Unauthorized Certificate or Form), and 601.088 (Effect on Certain Other Policies), Transportation Code; and (2) Subchapters G (Failure to Maintain Motor Vehicle Liability Insurance or Otherwise Establish Financial Responsibility; Criminal Penalties), H (Failure to Maintain Evidence of Financial Responsibility; Suspension of Driver's License and Motor Vehicle Registration), I (Failure to Maintain Evidence of Financial Responsibility; Impoundment of Motor Vehicle), J (Impoundment of Motor Vehicle Not Registered in This State), K (Evidence of Financial Responsibility Following Judgment, Conviction, Plea, or Forfeiture or Following Suspension or Revocation), L (Effect of Suspension), and M (Appeal of Department Action), Chapter 601, Transportation Code. SECTION 32. Makes application of Subchapter F, Chapter 601, Transportation Code, as amended by this Act, prospective. SECTION 33. Makes application of the punishment of an offense provided by this Act prospective. SECTION 34. Makes application of Section 84.004(c), Civil Practice and Remedies Code, and Section 61.096(b), Human Resources Code, as amended by this Act, prospective. SECTION 35. Makes application of Section 113.097(d), Natural Resources Code, as amended by this Act, prospective. SECTION 36. Makes application of SECTIONS 24-30 of this Act prospective. SECTION 37. Effective date: January 1, 2000. SECTION 38. Emergency clause.