BILL ANALYSIS


                                                     C.S.S.B. 598
                                                      By: Ratliff
                                             Economic Development
                                                         04-21-95
                                   Committee Report (Substituted)
BACKGROUND

Current law states that if an insurer delays payment of a claim for
a period exceeding the time limit provided, then the insurer shall
pay 18 percent interest on a claim and attorney fees as damage. 
However, this section has been interpreted to mean that the insurer
must bring suit against the insurance company in order to receive
the interest.  Many other states have statutes which provide for
automatic payment of interest in cases of life insurance benefits.

PURPOSE

As proposed, C.S.S.B. 598 requires attorney fees to be taxed as
part of the costs in a case where a claim is made pursuant to a
policy of insurance and the insurer liable is not in compliance
with certain requirements.

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 6, Article 21.55, Insurance Code, to
require attorney fees to be taxed, if suit is filed, as part of the
costs in a case where a claim is made pursuant to a policy of
insurance and the insurer liable is not in compliance with
requirements of this article.  Deletes language requiring the
insurer to be liable to pay reasonable attorney fees as may be
determined by the trier of fact.

SECTION 2. Effective date: September 1, 1995.

SECTION 3. Emergency clause.