§ 101.027.Liability Insurance

An insurance provision with three distinct parts.

Each governmental unit other than a unit of state government may purchase insurance policies protecting the unit and its employees against claims under this chapter. A unit of state government may purchase such a policy only to the extent authorized or required under other law.

The distinction reflects budgeting. The state pays judgments against itself through appropriation and does not generally insure; local governments manage risk with policies.

Subsection (b) permits the ordinary insurance bargain: the policies may relinquish to the insurer the right to investigate, defend, compromise, and settle any claim to which the coverage extends. That matters because it lets a private insurer control litigation on a public body's behalf — and the settlement section correspondingly dispenses with governing-body approval where insurance has been acquired.

Subsection (c) protects employees: the state or a political subdivision may not require an employee to purchase liability insurance as a condition of employment if the employer is itself insured by a liability policy.

Without it, an insured governmental employer could push the cost of coverage onto individual employees.

Note that the existence and amount of insurance are neither admissible nor discoverable under the evidence section — so the policy exists in the background of the litigation without being visible in it.