BILL ANALYSIS


                                                        S.B. 1667
                                                       By: Sibley
                                             Economic Development
                                                          4-29-95
                                     Committee Report (Unamended)
BACKGROUND

The state auditor recommends raising the limit for claims settled
by the receiver of an insolvent insurer, instead of the court, from
$1,000 to $10,000, because the cost of having legal counsel draft
the application and then having a hearing before the court to
approve relatively small dollar amount transactions was perceived
as cost ineffective and a docket burden.

PURPOSE

As proposed, S.B. 1667 raises the limit for claims settled by the
receiver of an insolvent insurer; requires the attorney general to
defend in any action brought against the receiver, a special deputy
of the receiver, or the commissioner of insurance.

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 2(g), Article 21.28, Insurance Code, to
authorize the receiver to compromise or compound a debt or claim or
sell property upon such terms as he or she may deem for the best
interest of the insurer without obtaining approval of the court,
whenever the amount of a debt or claim owed by or owing to an
insurer or the value of any item of property of the insurer does
not exceed $10,000, rather than $1,000, exclusive of interest. 
Authorizes the receiver, subject to the approval of the court and
the commissioner of insurance (commissioner), rather than the State
Board of Insurance, as required by this code, to sell or otherwise
dispose of the charter or license of the insurer separate and apart
from its outstanding liabilities.

SECTION 2. Amends Section 2, Article 21.28, Insurance Code, by
adding Subsection (j), as follows:

     (j) Immunity; Attorney General Representation.  (1) Provides
     that there is no liability on the part of and no cause of
     action of any nature arises against, the receiver or its
     agents and employees, a special deputy receiver or its agents
     or employees, or the commissioner or the commissioner's agents
     or employees for any good faith action or failure to act in
     the performance of powers and duties under this article.
     
     (2) Requires the attorney general to defend any action to
       which Subdivision (1) applies that is brought against the
       receiver or its agents or employees, a special deputy
       receiver or its agents or employees, or the commissioner or
       the commissioner's agents or employees.  Provides that this
       subsection continues to apply to an action instituted after
       the defendant's service with the receiver, a special deputy
       receiver, the commissioner, or the Department of Insurance
       has terminated or after the close of the receivership out of
       which the action arises.  Provides that this subsection does
       not require the attorney general to defend any person or
       entity with respect to an issue other than the applicability
       or effect of the judicial immunity created by Subdivision
       (1).
       
       SECTION 3.   Emergency clause.
           Effective date: upon passage.