BILL ANALYSIS


                                                        H.B. 1670
                                             By: Driver (Shapiro)
                                             Economic Development
                                                          5-18-95
                              Senate Committee Report (Unamended)
BACKGROUND

The 67th Legislature passed legislation that granted an employee,
officer, director, or shareholder of certain types of licensed
lending institutions the right to assign commissions earned in the
sale of a credit life or credit accident and health policy to the
employer lending institution.

The 69th Legislature then expanded the right of assignment and
allowed for the compensation to be assigned to a state or federal
savings and loan association or corporation. In the 72nd
Legislature the right of assignment was granted to state and
federal credit unions.

PURPOSE

As proposed, H.B. 1670 authorizes dealerships having a dealer's
license issued by the Texas Department of Transportation to assign
commissions, fees, or other compensation.

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 18, Article 21.07, Insurance Code, as
follows:

     Sec. 18. ASSIGNMENT OF AGENT'S COMMISSIONS. (a) Created from
     existing text.
     
     (b) Provides that an employee, officer, director, or
       shareholder of a dealer who holds a dealer's general
       distinguishing number issued by the Texas Department of
       Transportation, is licensed as an agent under this article,
       and enters into a contract with an insurer to act as the
       insurer's agent in soliciting or writing policies or
       certificates of credit life insurance, credit accident and
       health insurance, or both, may assign and transfer to the
       dealer or any affiliate of the dealer, any commissions,
       fees, or other compensation to be paid to the agent under
       the agent's contract with the insurer.
       
       SECTION 2.   Emergency clause.
           Effective date: upon passage.