BILL ANALYSIS C.S.H.B. 2893 By: Driver 04-26-95 Committee Report (Substituted) BACKGROUND Article 21.22, Insurance Code, protects annuity beneficiaries from general creditors. Section 5 makes void any assignment or commutation by a beneficiary if the insurance policy or annuity contract includes a provision against assignment or commutation of benefits. Annuity beneficiaries sometimes need to assign their benefits for financial or other reasons but are prevented from doing so under Section 5 as it is written. PURPOSE As proposed, House Bill 2893 would permit the voluntary assignment of the benefits of an annuity contract. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 5, Article 21.22, Insurance Code, to permit the voluntary assignment of an annuity contract, in writing, supported by consideration and secured by a pledge of the policy or its proceeds. SECTION 2. Emergency clause; Effective date COMPARISON OF ORIGINAL TO SUBSTITUTE The filed bill incorrectly inserted the new language in Section 6, Article 21.22. The substitute corrects the error by inserting the language in Section 5 of the article. The new language in the original version was revised by Legislative Council in the substitute to more artfully carry out the original intent of the bill. SUMMARY OF COMMITTEE ACTION In accordance with House rules, H.B. 2893 was heard in a public hearing on April 26, 1995. The Chair laid out H.B. 2893 and a substitute to H.B. 2893 and recognized the following person to testify in support of H.B. 2893: E. Kenneth Tooley, Texas Association of Life Underwriters. The Chair recognized Representative Counts who moved the Committee adopt the substitute to H.B. 2893. The Chair heard no objections and the substitute to H.B. 2893 was adopted. The Chair recognized Representative Counts who moved the Committee report H.B. 2893 as substituted to the full House with the recommendation that it do pass, be printed, and be sent to the Committee on Local and Consent. Representative Averitt seconded the motion and the motion prevailed by the following vote: AYES (6); NAYES (0); ABSENT (3); PNV (0).