(a) The plan of operation must include a voluntary, competitive limited assignment distribution plan that allows an authorized insurer to contract directly with a servicing carrier to accept assignments to the servicing carrier by the association.
(b) A servicing carrier must be authorized to write automobile insurance in this state and must:
(1) have written automobile liability insurance in this state for at least five years; or
(2) be currently engaged as a servicing carrier for assigned risk automobile business in at least one other state.

Terms Used In Texas Insurance Code 2151.154

  • Contract: A legal written agreement that becomes binding when signed.
  • Written: includes any representation of words, letters, symbols, or figures. See Texas Government Code 311.005

(c) After notice and hearing, the commissioner may prohibit an insurer from acting as a servicing carrier.
(d) An authorized insurer and a servicing carrier shall determine through negotiation the terms of a contract described by this section, including the buy-out fee.
(e) The governing committee may:
(1) adopt reasonable rules for the conduct of business under a contract described by this section; and
(2) establish reasonable standards of eligibility for servicing carriers.

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