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.