BILL ANALYSIS H.B. 885 By: Madden (Haywood) Economic Development 5-24-95 Senate Committee Report (Unamended) BACKGROUND Currently, the amount of insurance coverage allowed under group life insurance policies are insufficient to protect the financial security of an individual who must depend on the policy's benefits in the event of the insured's death. PURPOSE As proposed, H.B. 885 increases the limits on the amount of insurance coverage allowed under group life insurance policies. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 1, Article 3.50, Insurance Code, as follows: Sec. 1. DEFINITIONS. (1)(d) Prohibits a group life insurance policy from being issued that provides insurance on any employee which together with any other insurance under any group life insurance policies issued to the employer or to the trustees of a fund established by the employer exceeds $250,000, rather than $100,000, unless 700 percent, rather than 400 percent, of the annual compensation of such employee from employer or employers exceeds $250,000, in which event all such term insurance shall not exceed 700, rather than 400, percent of such annual compensation. (5)(d) Makes conforming changes. (7)(d) Makes conforming changes. (7A)(d) Makes conforming changes. (8) Provides that a policy issued to the Veterans Land Board of the State of Texas, who shall be deemed the policyholder to insure persons purchasing land under the Texas Veterans Land Program as provided in Chapter 161I, Natural Resources Code, rather than Section 16(B) of Article 5421m, V.T.C.S. SECTION 2. Effective date: September 1, 1995. Makes application of this Act prospective beginning January 1, 1996. SECTION 3. Emergency clause.