By:  Turner                                           S.B. No. 1239
       73R4179 DLF-D
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to the limit on coverage for certain annuity contracts
    1-3  under the Life, Accident, Health, and Hospital Service Insurance
    1-4  Guaranty Association Act.
    1-5        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-6        SECTION 1.  Section 5(3), Article 21.28-D, Insurance Code, is
    1-7  amended to read as follows:
    1-8              (3)  "Contractual obligation" means an obligation under
    1-9  a policy or contract or certificate under a group policy or
   1-10  contract, or portion thereof for which coverage is provided under
   1-11  Section 3 of this Act.  A contractual obligation does not include:
   1-12                    (A)  death benefits in an amount in excess of
   1-13  $300,000 or a net cash surrender or net cash withdrawal value in an
   1-14  amount in excess of $100,000 in the aggregate under one or more
   1-15  covered policies on any one life;
   1-16                    (B)  an amount in excess of $300,000 <$100,000>
   1-17  in the aggregate under one or more annuity contracts within the
   1-18  scope of this Act issued to the same holder of individual annuity
   1-19  policies or to the same annuitant or participant under group
   1-20  annuity policies or an amount in excess of $5,000,000 in
   1-21  unallocated annuity contract benefits with respect to any one
   1-22  contract holder irrespective of the number of such contracts;
   1-23                    (C)  an amount in excess of $200,000 in the
   1-24  aggregate under one or more accident and health, accident, or
    2-1  health insurance policies on any one life; or
    2-2                    (D)  punitive, exemplary, extracontractual, or
    2-3  bad faith damages, whether agreed to or assumed by an insurer or
    2-4  insured or imposed by a court of competent jurisdiction.
    2-5        SECTION 2.  This Act takes effect September 1, 1993, and
    2-6  applies only to the contractual obligations of an insurer
    2-7  designated an impaired insurer by the commissioner of insurance on
    2-8  or after that date.  The contractual obligations of an insurer
    2-9  designated an impaired insurer before the effective date of this
   2-10  Act are governed by the law as it existed immediately before the
   2-11  effective date of this Act, and that law is continued in effect for
   2-12  that purpose.
   2-13        SECTION 3.  The importance of this legislation and the
   2-14  crowded condition of the calendars in both houses create an
   2-15  emergency and an imperative public necessity that the
   2-16  constitutional rule requiring bills to be read on three several
   2-17  days in each house be suspended, and this rule is hereby suspended.