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Texas Insurance Code - Not Codified - Article 5.01. Fixing Rate Of Automobile Insurance

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Art. 5.01. FIXING RATE OF AUTOMOBILE INSURANCE.  (a) Every 
insurance company, corporation, interinsurance exchange, mutual, 
reciprocal, association, Lloyd's or other insurer, hereinafter 
called insurer, writing any form of motor vehicle insurance in this 
State, shall annually file with the State Board of Insurance, 
hereinafter called Board, on forms prescribed by the Board, a 
report showing its premiums and losses on each classification of 
motor vehicle risks written in this State.
	(b)  The Board shall have the sole and exclusive power and 
authority, and it shall be its duty to determine, fix, prescribe, 
and promulgate just, reasonable and adequate rates of premiums to 
be charged and collected by all insurers writing any form of 
insurance on motor vehicles in this State, including fleet or other 
rating plans designed to discourage losses from fire and theft and 
similar hazards and any rating plans designed to encourage the 
prevention of accidents.  In promulgating any such rating plans the 
Board shall give due consideration to the peculiar hazards and 
experience of individual risks, past and prospective, within and 
outside the State and to all other relevant factors, within and 
outside the State.  The Board shall have the authority also to alter 
or amend any and all of such rates of premiums so fixed and 
determined and adopted by it, and to raise or lower the same or any 
part thereof.
	(c)  At least annually, the Board shall conduct a hearing to 
review the reports of premiums earned and losses incurred in the 
writing of motor vehicle insurance in this State and may fix, 
determine, and adopt new rates in whole or in part or may alter or 
amend rates previously fixed, determined, and adopted by the Board 
to assure that those rates comply with the requirements of this 
subchapter.
	(d)  Said Board shall have authority to employ clerical help, 
inspectors, experts, and other assistants, and to incur such other 
expenses as may be necessary in carrying out the provisions of this 
law;  provided, however, that the number of employees and salary of 
each shall be fixed in the General Appropriation Bill passed by the 
Legislature.  The Board shall ascertain as soon as practicable the 
annual insurance losses incurred under all policies on motor 
vehicles in this State, make and maintain a record thereof, and 
collect such data as will enable said Board to classify the various 
motor vehicles of the State according to the risk and usage made 
thereof, and to classify and assign the losses according to the 
various classes of risks to which they are applicable;  the Board 
shall also ascertain the amount of premiums on all such policies for 
each class of risks, and maintain a permanent record thereof in such 
manner as will aid in determining just, reasonable and adequate 
rates of premiums.
	(e)  Motor vehicle or automobile insurance as referred to in 
this subchapter shall be taken and construed to mean every form of 
insurance on any automobile or other vehicle hereinafter enumerated 
and its operating equipment or necessitated by reason of the 
liability imposed by law for damages arising out of the ownership, 
operation, maintenance, or use in this State of any automobile, 
motorcycle, motorbicycle, truck, truck-tractor, tractor, traction 
engine, or any other self-propelled vehicle, and including also 
every vehicle, trailer or semi-trailer pulled or towed by a motor 
vehicle, but excluding every motor vehicle running only upon fixed 
rails or tracks.  Workers' Compensation Insurance is excluded from 
the foregoing definition.
	(f)  Notwithstanding Subsections (a) through (d) of this 
article, on and after the effective date of S.B. No. 14, Acts of the 
78th Legislature, Regular Session, 2003, rates for personal 
automobile insurance in this state are determined as provided by 
Article 5.101 of this code, and rates for commercial motor vehicle 
insurance in this state are determined as provided by Article 
5.13-2 of this code.  On and after December 1, 2004, rates for 
personal automobile insurance and commercial automobile insurance 
in this state are determined as provided by Article 5.13-2 of this 
code.

Acts 1951, 52nd Leg., ch. 491.  Amended by Acts 1953, 53rd Leg., p. 
64, ch. 50, Sec. 2.

Amended by Acts 1987, 70th Leg., 1st C.S., ch. 1, Sec. 2.06, eff. 
Sept. 2, 1987;  Subsec. (f) added by Acts 1991, 72nd Leg., ch. 242, 
Sec. 2.02, eff. Sept. 1, 1991;  amended by Acts 1991, 72nd Leg., 2nd 
C.S., ch. 12, Sec. 8.04, eff. Jan. 1, 1992;  amended by Acts 1995, 
74th Leg., ch. 984, Sec. 2, eff. Sept. 1, 1995;  Subsec. (f) amended 
by Acts 2003, 78th Leg., ch. 206, Sec. 21.01, eff. June 11, 2003.

Last modified: August 11, 2007