Office of House Bill AnalysisH.B. 1036
By: Thompson


Insurance companies are required by law to give information about the
settlement of claims to their insureds, but they are not required by law to
give information to persons settling claims with a company against its
insureds.  As a result, many Texans are disadvantaged when settling claims
with insurance companies other than their own insurers, because such
claimants are not aware of their rights.  House Bill 1036 requires
insurance companies to disclose certain information to insurance claimants.


It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the commissioner of insurance in
SECTION 1 (Sections 3 and 5, Article 21.21-11, Insurance Code) and SECTION
2 in this bill.   


House Bill 1036 amends the Insurance Code to require an insurer to provide
a third-party claimant (claimant) with a copy of the disclosure document
adopted by the commissioner of insurance (commissioner) and sets forth
provisions regarding the issuance of the required disclosure document to
certain claimants.  The bill requires the insurer to provide the disclosure
document only in response to the first notice of a claim received by the
insurer.  The bill requires the office of public insurance counsel (office)
to submit and the commissioner to adopt, by rule, a disclosure document
that, along with any other information the office determines is relevant,
informs the claimant of the following:   

 _the insurer does not represent the claimant; 
 _the interest of the insurer or the insurer's insured may be in conflict
with the claimant's interests;  
 _the claimant is not required to accept a settlement offered by the
insurer or the insurer's representative; and  

 _the claimant has the right to consult with an attorney of the claimant's
choice or seek other assistance at any time to evaluate the fairness of any
request for information or settlement offer made by the insurer.   

This bill requires the commissioner to adopt rules as necessary to
administer these provisions.   

The office of public insurance counsel is required to submit the disclosure
document to the commissioner of insurance not later than November 1, 2001,
and the commissioner is required to adopt the document by rule not later
than December 1, 2001.  The change in law made by this Act applies only to
notice of a claim as added by this Act, received by an insurer on or after
January 1, 2002. 


September 1, 2001.