TH~~A~ORNEYGENERAL 

OF’ TEXAS 

AXJIWX-IN. T-s 78711 

May 7, 1975 

The Honorable hi. L. Brockette 

Commiraioner of Education 

201 East Eleventh Street 

Austin, Texar 78701 

Opinion No. H- 602 

Re: Uee of school dicrtrict 

fund6 to purchase personal 

injury insurance protection. 

Dear Dr. Brockette: 

Noting that school dirtrictr are authorized to purchase insurance 

protection againat claim8 made by injured partier and othera under the 

Texas Tort Claims Act (Article 6252-19, V. T. C. S.), your office has 

asked whether an independent rchool dirtrict may we local district 

maintenance funds to purchase: 

(a) Personal injury protection coverage as provided for in article 5.06-3, Vernon’8 Texas Inruranco Code (Acts 1973, 63rd Leg., ch. 52, p. 90); 

(b) Uninsured motorist protection as provided for 

in article 5.06-1, Vernon’8 Texas Insurance Code, 

(Acts 1967; 60th Leg., .ch. 202; p. 448). 

In Attorney General Opinion M-989 (1971) this office concluded 

that school districts were authorized to purchase insurance protection 

against claims for bodily injury arising out of risks recognized by 

section 3 of the Texas Tort Claim8 Act (the general liability section) 

and that they might also purchase such insurance to cover employees 

exposed to individual liability by virtue of their official duties. And 

- 

see Attorney General Opinion H-70 (1973). 

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Article 5.06-3 requirea that, unlear the coverage ir rejected 

in writing, all policier of automobile liability inrurance issued or 

delivered in thin State shall provide for personal injury protection 

coverage, defined in subparagraph (b) ar: 

p. 2670 
The Honorable M. L. Brockette page 2 (H-602) 

“Personal injury protection” consists of provisions of a motor vehicle liability policy which 

provide for payment to the named insured in the 

motor vehicle liability policy and members of the 

insured’s household, any authorized operator or 

passenger of the named insured’s motor vehicle 

including a guest occupant, up to an amount of 

$2,500 for each such person for payment of all 

reasonable expenses arising from the accident 

and incurred within three years from the date thereof 

for necessary medical, surgical, X-ray and dental 

services, including prosthetic devices, and necessary 

ambulance, hospital, professional nursing and 

funeral services, and in the case of an income 

producer, payment of benefits for loss of income 

as the result of the accident; and where the person 

injured in the accident was not an income or wage 

producer at the time of the accident, payments of 

benefits must be made in reimbursement of necessary and reasonable expenses incurred for essential 

services ordinarily performed by the injured person 

for care and maintenance of the family or family 

household. . . . 

Subparagraph (c) of the article provides that the benefits are payable 

without regard to fault and without regard to the availability of similar 

benefits from a collateral source. It provides that payment of the benefit 

shall not create in the insurer any right of subrogation. These provisions 

assure recovery by the beneficiary regardless of duplicate payments in a 

judgment against a third person, under workmen6 compensation, under a 

hospitalization policy, under a policy covering interruption of employment, 

or any other source. 

Despite the similarity of this coverage to other coverages which 

have been approved for purchase by subdivisions of the State, and 

particularly school districts, we are compelled to hold that there is no 

authorization for a school district to purchase personal injury protection 

p. 2671 
The Honorable M. L. BrockeJte page 3 (H-602) 

coverage as defined in article 5.06-3(b) of the Insurance Code. 

Furnishing hospitalization insurance has been upheld only 

because it is considered a part of the employee’s compensation. 

Attorney General Opinions Nos. WW-7.31 (1959); WW-1101 (1961). And 

see Byrd V. City of Dallas, 6 S. W. 2d. 738 (Tex. 1938). 

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However, under section 5.06-3, the coverage bought by the 

school district is not only for the employee but also for any other persons 

who are injured while riding in vehicles owned by the school district 

and operated by its employees. Although limited coverage which 

benefited only the employee and those for whom he is financially responsible might be authorized as a part of an employee’s compensation, s,uch 

broad coverage as 5.06-3 contemplates is not, in our opinion, actually 

employee compensation since the benefits inure to such a ,broad ,group of 

persons. 

Further, the school district is not authorized to spend funds to 

benefit private individuals. Tex. Const. art. 3, sets. 50, 51 and 52. 

Under section 5.06-3, the no-fault character of the coverage would 

provide benefits to persons to whom the school district owes no legal 

obligation. 

In our opinion the provisions of such coverage, at the expense 

of the school district, would amount to a grant of public money or thing 

of value to an individual, in violation of article 3, sections 50, 51 and 52 

of the Texas Constitution. 

We, therefore, answer your first question in the negative. 

Uninsured motorist coverage is not defined by statute as precisely as is personal injury protection coverage. See article 5.06-1, 

Vernon’s Texas Insurance Code. As described in Lhe Texas Standard 

Form automobile liability policy, it is the obligation of the insurer: 

To pay all sums which the insured or his legal 

representative shall be legally entitled to recover 

as damages from the owner or operator of an uninsured 

p. 2672 
The Honorable M. L. Brockette page 4 (H-602) 

automobile because of bodily injury, sickness or 

disease. including death resulting therefore, . . . 

caused by accident and arising out of the ownership 

maintenance or use of such uninsured automobile . , . 

In effect, payment under this coverage would meet the obligation 

of a third person to the occupant of the district’s vehicle (whether an 

employee or not) at the expense of the district. We feel the same 

observations we made earlier as to the personal injury protection 

coverage would apply and that there is no authority for the purchase 

of such uninsured motorist coverage by a school district upon its 

vehicles. 

Such coverage does not in any way meet any obligation of the 

school district created by the Tort Claims Act. 

We therefore answer your second question in the negative. 

SUMMARY 

The purchase of either personal injury protection 

coverage or uninsured motorist coverage by an 

independent school district with local district 

maintenance funds would be unconstitutional. 

LL, First Assistant 

C. ROBERT HEATH, Chairman 

Attorney General of Texas 

Opinion Committee 

p. 2673