Texas Insurance Code - Not Codified - Article 5.07-1. Repair Of Motor Vehicles; Disclosure Of Consumer Information
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Texas Laws > Insurance Code - Not Codified > Texas Insurance Code - Not Codified - Article 5.07-1. Repair Of Motor Vehicles; Disclosure Of Consumer Information
Article: 5.06-1 5.06-2 5.06-3 5.06-4 5.06-5 5.06-6 5.07 5.07-1 5.08 5.09 5.10 5.11 5.12-1 5.13 5.13-1
Art. 5.07-1. REPAIR OF MOTOR VEHICLES; DISCLOSURE OF
Article repealed effective April 1, 2007
(a) Except as provided by rules duly adopted by the
commissioner, under an auto insurance policy that is delivered,
issued for delivery, or renewed in this state an insurer may not,
directly or indirectly, limit its coverage under a policy covering
damage to a motor vehicle by specifying the brand, type, kind, age,
vendor, supplier, or condition of parts or products that may be used
to repair the vehicle or by limiting the beneficiary of the policy
from selecting a repair person or facility to repair damage to the
motor vehicle covered under the policy.
(b) In connection with the repair of damage to a motor
vehicle covered under an auto insurance policy, an insurer, an
employee of an insurer, an agent of an insurer, a solicitor of
insurance for an insurer, an insurance adjuster, or an entity that
employs an insurance adjuster may not:
(1) solicit or accept a referral fee or gratuity in exchange
for referring a beneficiary or third-party claimant to a repair
person or facility to repair the damage;
(2) state or suggest, either orally or in writing, to a
beneficiary that a specific repair person or facility or a repair
person or facility identified on a preferred list compiled by an
insurer must be used by a beneficiary in order for the damage repair
or parts replacement to be covered by the policy; or
(3) restrict a beneficiary's or third-party claimant's
right to choose a repair person or facility by requiring the
beneficiary or third-party claimant to travel an unreasonable
distance to repair the damage.
(c) A contract between an insurer and a repair person or
facility, including an agreement under which the repair person or
facility agrees to extend discounts for parts or labor to the
insurer in exchange for referrals by the insurer, may not result in
a reduction of coverage under the insured's auto insurance policy.
(d) An insurer may not prohibit a repair person or facility
from providing a beneficiary or third-party claimant with
information that states the description, manufacturer, or source of
the parts used and the amounts charged to the insurer for the parts
and related labor.
(e) At the time the vehicle is presented to an insurer or an
insurance adjuster or other person in connection with a claim for
damage repair, the insurer or insurance adjuster or other person
shall provide to the beneficiary or third-party claimant notice of
the provisions of this article. The commissioner shall adopt a rule
establishing the method or methods insurers shall use to comply
with the notice provisions in this subsection.
(f) Any beneficiary, third-party claimant, or repair person
or facility may submit a written, documented complaint to the
department with respect to an alleged violation of this article.
(g) In the settlement of liability claims by a third party
against an insured for property damage claimed by the third party,
an insurer may not require the third-party claimant to have repairs
made by a particular repair person or facility or to use a
particular brand, type, kind, age, vendor, supplier, or condition
of parts or products.
(h) The commissioner may exercise the rule-making authority
under Article 21.21-2 of this code with respect to any fraudulent
activity of any party to an agreement described by Subsection (c) of
(i) Any rules adopted by the commissioner to implement this
article shall include, but not be limited to, requirements that:
(1) any limitation described in Subsection (a) of this
section is clearly and prominently displayed on the face of the
policy or certificate in lieu of a policy; and
(2) the insured give written consent to such a limitation,
following both oral and written notification of any limitation at
the time the policy is purchased.
Added by Acts 1991, 72nd Leg., ch. 242, Sec. 2.11, eff. Sept. 1,
1991. Amended by Acts 1997, 75th Leg., ch. 399, Sec. 1, eff. Sept.
Last modified: August 11, 2007