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A BILL TO BE ENTITLED
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AN ACT
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relating to disclosure of an automatic premium loan provision in a |
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life insurance policy. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 1101, Insurance Code, is amended by |
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adding Subchapter G to read as follows: |
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SUBCHAPTER G. REQUIRED DISCLOSURES AND NOTICES |
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Sec. 1101.301. DISCLOSURE OF AUTOMATIC PREMIUM LOAN |
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PROVISION. (a) Before issuing a life insurance policy that |
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contains an automatic premium loan provision, an insurer shall: |
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(1) provide a written notice disclosing the automatic |
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premium loan provision that: |
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(A) is printed in at least 16-point font on a |
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separate page of the application or enrollment form for the policy; |
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(B) includes an affirmation that the insurer read |
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the notice aloud as required by Subdivision (2); and |
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(C) is signed by the applicant separately from |
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the rest of the application or enrollment form; and |
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(2) read the notice described by Subdivision (1) aloud |
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to the applicant. |
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(b) If any related policy document is in a language other |
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than English, notice under Subsection (a) must be provided and read |
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in that language in addition to English. |
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(c) The commissioner may adopt rules as necessary to |
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implement this section, including rules establishing what |
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satisfies the oral notice requirement under Subsection (a)(2). |
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SECTION 2. Subchapter G, Chapter 1101, Insurance Code, as |
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added by this Act, applies only to an insurance policy delivered or |
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issued for delivery on or after January 1, 2024. A policy delivered |
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or issued for delivery before January 1, 2024, is governed by the |
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law as it existed immediately before the effective date of this Act, |
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and that law is continued in effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2023. |