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AN ACT
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relating to farm mutual insurance companies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 221.001, Insurance Code, is amended by |
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amending Subsection (b) and adding Subsection (c) to read as |
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follows: |
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(b) This chapter does not apply to: |
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(1) a fraternal benefit society, including a fraternal |
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benefit society operating under Chapter 885; |
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(2) a group hospital service corporation operating |
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under Chapter 842; |
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(3) a stipulated premium company operating under |
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Chapter 884; |
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(4) a mutual assessment association, company, or |
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corporation regulated under Chapter 887; [or] |
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(5) a purely cooperative or mutual fire insurance |
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company carried on by its members solely for the protection of their |
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own property and not for profit, except as provided by Section |
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221.002(b)(13); or |
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(6) a farm mutual insurance company operating under |
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Chapter 911, unless the company is acting as a fronting insurer. |
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(c) In this section, "fronting insurer" means a farm mutual |
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insurance company: |
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(1) issuing an insurance policy that is the result of: |
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(A) marketing by an insurer not affiliated with |
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the farm mutual insurance company; |
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(B) an application submitted by a consumer to an |
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insurer not affiliated with the farm mutual insurance company; or |
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(C) an agreement with an insurer that is not a |
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farm mutual insurance company solely for the purpose of being |
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regulated under Chapter 911; or |
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(2) that cedes 85 percent or more of the farm mutual |
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insurance company's direct written premium to one or more |
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nonaffiliated reinsurers. |
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SECTION 2. Section 252.005, Insurance Code, is amended to |
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read as follows: |
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Sec. 252.005. EXCEPTION. This chapter does not apply to: |
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(1) a farm mutual insurance company operating under |
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Chapter 911, unless the company is acting as a fronting insurer as |
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defined by Section 221.001(c); or |
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(2) a mutual insurance company engaged in business |
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under Chapter 12, Title 78, Revised Statutes, before that chapter's |
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repeal by Section 18, Chapter 40, Acts of the 41st Legislature, 1st |
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Called Session, 1929, as amended by Section 1, Chapter 60, General |
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Laws, Acts of the 41st Legislature, 2nd Called Session, 1929, that |
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retains the rights and privileges under the repealed law to the |
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extent provided by those sections. |
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SECTION 3. Section 911.065, Insurance Code, is amended by |
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adding Subsection (c) to read as follows: |
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(c) A farm mutual insurance company may provide in its |
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constitution or bylaws that a policyholder may vote electronically |
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or by mail without making a personal appearance at a policyholders' |
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meeting. |
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SECTION 4. Section 2210.006(b), Insurance Code, is amended |
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to read as follows: |
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(b) This chapter does not apply to: |
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(1) a farm mutual insurance company operating under |
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Chapter 911, unless the company is acting as a fronting insurer, as |
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defined by Section 221.001(c); |
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(2) a nonaffiliated county mutual fire insurance |
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company described by Section 912.310 that is writing exclusively |
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industrial fire insurance policies as described by Section |
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912.310(a)(2); or |
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(3) a mutual insurance company or a statewide mutual |
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assessment company engaged in business under Chapter 12 or 13, |
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Title 78, Revised Statutes, respectively, before those chapters' |
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repeal by Section 18, Chapter 40, Acts of the 41st Legislature, 1st |
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Called Session, 1929, as amended by Section 1, Chapter 60, General |
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Laws, Acts of the 41st Legislature, 2nd Called Session, 1929, that |
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retains the rights and privileges under the repealed law to the |
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extent provided by those sections. |
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SECTION 5. (a) Sections 221.001 and 252.005, Insurance |
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Code, as amended by this Act, do not affect tax liability accruing |
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before the 2017 calendar year. That liability continues in effect |
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as if this Act had not been enacted, and the former law is continued |
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in effect for the collection of taxes due and for civil and criminal |
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enforcement of the liability for those taxes. |
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(b) Section 2210.006(b), Insurance Code, as amended by this |
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Act, applies only to participation in the Texas Windstorm Insurance |
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Association on or after the effective date of this Act, including |
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the payment of assessments the liability for which accrues on or |
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after that date. Participation in the Texas Windstorm Insurance |
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Association before the effective date of this Act, including the |
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payment of assessments the liability for which accrued before that |
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date, is governed by the law as it existed immediately before that |
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date, and that law is continued in effect for that purpose. |
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SECTION 6. This Act takes effect September 1, 2017. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I certify that H.B. No. 3496 was passed by the House on May 4, |
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2017, by the following vote: Yeas 143, Nays 0, 2 present, not |
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voting; and that the House concurred in Senate amendments to H.B. |
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No. 3496 on May 24, 2017, by the following vote: Yeas 138, Nays 7, |
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2 present, not voting. |
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______________________________ |
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Chief Clerk of the House |
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I certify that H.B. No. 3496 was passed by the Senate, with |
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amendments, on May 22, 2017, by the following vote: Yeas 31, Nays |
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0. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: __________________ |
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Date |
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__________________ |
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Governor |