# TEE A-JTORIQEY ~GE%YERAL OF ?JYExAs

AURm l~(-rlilxb

April 9, 1953

Hon. Garland A. Smith Casualty Insurance Commissioner Board of Insurance Commissioner~$ Austin 1,.Texas Gpinion No. S-28

Dear Sir: **. ’**  Re:~ Applicability .ofSec. 35 ofArt.’ 6701h. V.C.S., the Assigned Risk Plan. to a casualty insurance company writing ‘insurance only on motor buses and motor trucks holding motor carrier permits from the Railroad Commission. ,: You have iequested..our’opinion,as tom the:applicability of Section 35 ofArticle .6701h. Vernon’s Civil,Statutes, to a casualty insurance company which confines itself towritings liability insurance oncertificated motor bus and **motor** truck carriers.~ Section35 of,Article 6701h provides for the Assigned Risk Plan, ,this-.section.,being a part of the Texas Motor Vehicle Safety Responsibility Act. Pursliant~to that section, you inform us that the Board of Insurance Commissioners approved a plan, effective January 1, 1952, calling foi’the assignment of less~attractive risks to casualty insurance companies finTexas; The Tr’ansptiit Insurance’Company ,ofTexas, a casualty ‘insuranc~e company which doesnot write liability insurance other than on certificated ‘motor bus a& motor’truck cdrriejr.s. has,re,sisted participation in the plan and~thd~acce&nce of risks assigned to,it,under the plan, Andy you therefore ask,our opinion ,astothe follciwmg two questions: “(1) Is the Transport
,‘Insurance Company required ‘~

to participate in the plan even though it might provide no insurance onmotor vehicles subject’to assignment under the Act. and “(2) Must the Transport Insurance’~Company ac- ” cept assignments based onall of its Texas’motor vehicle liability insurance premi,ums or only those premiums derived from m~otor‘vehicles subject tothe‘~Motoi Vehicle Safety Responsibility Act.* .”Hon. 

### GarlandA. Smith, papc 2 (S-28)

Your letter **informs** us that the Transport Insurance Company of Texas is a casualty insurance? company, and under the Insurance Code, such companies are authorized to issue motor vehicle liability palicies in the State of Texas.

Sec. 35 ofArt.. 6701h, V.C.S., provides, in part, as follows:

“Sec. 35. Subject to the provisions of Section 9of Article 4682b of Texas Revised Civil Statutes, insurance companies authorised to issue motor vehicle liability policies in this State may establish an administrative agency and make necessary reasonable rules in connection therewith, relative to the formation of a plan and procedure to provide a means by which insurance may be assigned to an authorized insurance company for a person required by this Act to show proof of financial responsibility for the future and who is in good faith entitled to motor vehicle liability insurance inthis State but is unable to secure it through ordinary methods; and may establish a plan and pr,ocedure for the equitable apportionment among such authorized companies ofapplicants for such policies and

‘for motor vehicle liability policies. including, but not limited to, voluntary agreements ,by insurance companies to accept such assignments. WJren any such plan has been approved by the Board of Insurance Commrssloners, all
msurance cornnames authorxsed to rs,sue motor vehicle Eabrlity policies in the State of Texas shall subscribe fhereto and participate there:&” (Emphasis supple

. - Since the,Transport Insurance Company of Texas is authorized towrite liability insurance on any motor vehicle, under the clear and unambiguous language emphasized in the foregoing section, such company must subscribe toand participate in any plan apprwed by the Board of~Insurance Commissioners, regardless ofany~company policy it may have as towriting certificated motor carriers or preferred
or extra-hasardous risks. We, therefore, answer ,your first question to the effect.~that~if the Transport Insurance ~Company of Texas is authorized under its shader towrite liability insurance onmotor vehicles in Texas, it is required to participate inthe plan regardless of the risks it may be insuring under its presently existing company policy.

Your second question, however, relates to the assignsne;ht;~ of risks $o the Transport Insurance Company of Texas. You inquire whether this should be based onthe premiums realized by the company on certificated motor carriers or on motor vehicles other than certificated motor carriers. Inanswering this question it is necessary to call to your attention the provisions of Smec.33 ofArt. 6701h, which provides, in part, a’sfollows:Hon. Garland A. Smith, page 3 (S-28)

“This Act shall not apply

. . .with respect to any motor vehicle which is subject to the requirements of Articles 911a(Sec. 11)and 911b(Set, 13)of Texas Revised Civil Statutes;

. . aR

From your letter it appears that the Transport Insurance Company is writing insurance only on motor carriers which have complied with the provisions ofArt. 91la. Sec. 11.s.ndArt. 911b,Sec. 13,V.C.S., by filing a bond or insurance policy with the Railroad Commission in amounts required by the Commission. This being true, the motor vehicles which the company insures are clearly exceptemi from the provisions ofArt. 6701h by the unequivocal language pointed out i:nSec. 33. Ifsuch motor vehicles
are excepted from the provisions ofthe Act, clearly the premiums realized from liability insurance on such motor vehicles are likewise excepted from the application ofthe Act. The Board’of Insurance Commissioners, therefore, under any plan ofassigned risks which it has approved, could not legally require the assignment of risks to a casualty insurance company predicated upon premiums realized from certificated motor carriers,
as such vehicles, and any insurance premiums thereon, are excepted from the operation of the Act. We therefore answer your second question to the effect that the Board of Insurance Commissioners may not approve a plan requiring the assignment of risks toa casualty insurance company predicated upon premiums realized solely from certificated motor bus and motor truck risks.

We further express no opinion as to the constitutionality of either Sec. 35 ofArt. 67Olh or ofthe plan approved by the Board thereunder.
SUMMAR’I
A casualty insurance company authorized under its charter towrite motor vehicle liability insurance is required to subscribe to and participate in the Assigned Risk Plan provided for under Art. 6701h. Sec. 35, V.C.S. Such company may not be compelled to accept risks predicated upon the premiums realized by the company on certificated motor bus and motor truck companies, which have complied with Art. 911a.Sec. 11,V.C.S., and Art. 911b.Sec. 13,V.C.S.
APPROVED: Yours very truly,
C. K. Richards JOHN BEN SHEPPERD Reviewer Attorney General
Willis E. Gresham Reviewer
Robert S. Trotti First Assistant Ass&s&t‘

John Ben Shepperd Attorney General