BILL ANALYSIS


                                                        H.B. 2256
                                              By: Shields (Madla)
                                             Economic Development
                                                         05-17-95
                              Senate Committee Report (Unamended)
BACKGROUND

The first viatical company appeared in 1988. Under a viatical
settlement agreement, an investor buys the life insurance policy of
someone terminally ill for less than the face value, becomes the
beneficiary and makes money when the person dies. In return, the
terminally ill person receives a large amount of cash, usually 50
to 80 percent of the policy depending on his or her life
expectancy. Cancer patients make up about 10 percent of these
participants. The industry has grown rapidly with the onset of
AIDS.

PURPOSE

As proposed, H.B. 2256 repeals Article 3.50-6A, Insurance Code,
relating to viatical settlements.

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. Repealer: Article 3.50-6A, Insurance Code (Viatical
settlements).

SECTION 2  Emergency clause.
           Effective date: upon passage.