Texas Bill Addressing TPA/Insurer Ownership of Auto Glass Businesses Progresses
May 13, 2011

A Texas bill designed to address cases in which a third-party administrator (TPA) holds at least a 10 percent in an auto glass "service" has passed from the House's Licensing and Administrative Procedures Committee on to the full House for review-but with a few changes from the original wording.

While the original bill would have specified a prohibition against an insurer or TPA "owning or requiring an in interest in an automotive glass repair service," the newest version of the bill prohibits TPAs that hold at least a 10-percent ownership interest in an "automotive glass repair service" from referring a third-party claimant or insured to the company; coercing a third-party claimant or insured to utilize the company's services, and using consumer information obtained in the process of acting as a third-party administrator to solicit business for the auto glass company.

The bill defines "automotive glass repair service" as a person that engages in the business of automotive glass work.

The bill also previously required language related to auto glass "inspections," and would have specified that such "inspectors" be direct employees of the insurer and not affiliated with any auto glass company. However, this language also has been removed.

The bill was introduced by Texas Rep. Senfronia Thompson (D-Texas). If passed, the bill would take effect on September 1.

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