By Madden H.B. No. 885
74R4382 MWV-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the amount of insurance coverage allowed under group
1-3 life insurance policies.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 1, Article 3.50, Insurance Code, is
1-6 amended to read as follows:
1-7 Sec. 1. DEFINITIONS. No policy of group life insurance
1-8 shall be delivered in this state unless it conforms to one of the
1-9 following descriptions:
1-10 (1) A policy issued to an employer, or to the trustees
1-11 of a fund established by an employer, which employer or trustees
1-12 shall be deemed the policyholder, to insure employees of the
1-13 employer for the benefit of persons other than the employer,
1-14 subject to the following requirements:
1-15 (a) The employees eligible for insurance under
1-16 the policy shall be all of the employees of the employer, or all of
1-17 any class or classes thereof determined by conditions pertaining to
1-18 their employment. The policy may provide that the term "employees"
1-19 shall include the employees of one or more subsidiary corporations,
1-20 and the employees, individual proprietors, and partners of one or
1-21 more affiliated corporations, proprietors or partnerships if the
1-22 business of the employer and of such affiliated corporations,
1-23 proprietors or partnerships is under common control through stock
1-24 ownership, contract, or otherwise. The policy may provide that the
2-1 term "employees" shall include the individual proprietor or
2-2 partners if the employer is an individual proprietor or a
2-3 partnership. The policy may provide that the term "employees"
2-4 shall include retired employees.
2-5 (b) The premium for the policy shall be paid by
2-6 the policyholder, either wholly from the employer's fund or funds
2-7 contributed by him, or partly from such funds and partly from funds
2-8 contributed by the insured employees. No policy may be issued on
2-9 which the entire premium is to be derived from funds contributed by
2-10 the insured employees. A policy on which part of the premium is to
2-11 be derived from funds contributed by the insured employees may be
2-12 placed in force only if at least seventy-five percent (75%) of the
2-13 then eligible employees, excluding any as to whom evidence of
2-14 individual insurability is not satisfactory to the insurer, elect
2-15 to make the required contributions. A policy on which no part of
2-16 the premium is to be derived from funds contributed by the insured
2-17 employees must insure all eligible employees, or all except any as
2-18 to whom evidence of individual insurability is not satisfactory to
2-19 the insurer.
2-20 (c) The policy must cover at least ten (10)
2-21 employees at date of issue.
2-22 (d) The amounts of insurance under the policy
2-23 must be based upon some plan precluding individual selection either
2-24 by the employees or by the employer or trustees. No policy may be
2-25 issued which provides insurance on any employee which together with
2-26 any other insurance under any group life insurance policies issued
2-27 to the employer or to the trustees of a fund established by the
3-1 employer exceeds Two <One> Hundred Fifty Thousand Dollars
3-2 ($250,000.00) <($100,000.00)>, unless seven <four> hundred percent
3-3 <(400%)> of the annual compensation of such employee from his
3-4 employer or employers exceeds Two <One> Hundred Fifty Thousand
3-5 Dollars ($250,000.00) <($100,000.00)>, in which event all such term
3-6 insurance shall not exceed seven <four> hundred percent <(400%)> of
3-7 such annual compensation, except that this limitation shall not
3-8 apply to group insurance on other than the term plan where such
3-9 insurance is to be used to fund the benefits under a pension or
3-10 profit sharing plan and the amount of such insurance does not
3-11 exceed that required to provide at normal retirement date the
3-12 pension specified by the plan, and except that a group policy which
3-13 is issued by the same or another carrier to replace another group
3-14 policy may provide term insurance not to exceed the amounts
3-15 provided by the policy which it replaces, or the amounts provided
3-16 above, whichever are greater.
3-17 (2) A policy issued to a labor union, which shall be
3-18 deemed the employer and policyholder, to insure the members of such
3-19 union who are actively engaged in the same occupation and who shall
3-20 be deemed to be the employees of such union within the meaning of
3-21 this Article.
3-22 (3) A policy issued to any association of employees of
3-23 the United States Government or any subdivision thereof, provided
3-24 the majority of the members of such association are residents of
3-25 this state, an association of public employees, an incorporated
3-26 city, town or village, an independent school district, common
3-27 school district, state colleges or universities, any association of
4-1 state employees, any association of state, county and city, town or
4-2 village employees, and any association of any combination of state,
4-3 county or city, town or village employees and any department of the
4-4 state government which employer or association shall be deemed the
4-5 policyholder to insure the employees of any such incorporated city,
4-6 town or village, of any such independent school district, of any
4-7 common school district, of any such state college or university, of
4-8 any such department of the state government, members of any
4-9 association of state, county or city, town or village or of the
4-10 United States Government or any subdivision thereof, provided the
4-11 majority of such employees reside in this state, employees for the
4-12 benefit of persons other than the policyholder subject to the
4-13 following requirements:
4-14 (a) The persons eligible for insurance under the
4-15 policy shall be all of the employees of the employer or if the
4-16 policyholder is an association, all of the members of the
4-17 association.
4-18 (b) The premium for a policy issued to any
4-19 policyholder authorized to be such policyholder under Subsection
4-20 (3) of Section 1, Article 3.50, Texas Insurance Code, may be paid
4-21 in whole or in part from funds contributed by the employer, or in
4-22 whole or in part from funds contributed by the persons insured
4-23 under said policy; or in whole or in part from funds contributed by
4-24 the insured employees who are members of such association of
4-25 employees; provided, however, that any monies or credits received
4-26 by or allowed to the policyholder pursuant to any participation
4-27 agreement contained in or issued in connection with the policy
5-1 shall be applied to the payment of future premiums and to the pro
5-2 rata abatement of the insured employees' contribution therefor; and
5-3 provided further, that the employer may deduct from the employees'
5-4 salaries the employees' contributions for the premiums when
5-5 authorized in writing by the respective employees so to do. Such
5-6 policy may be placed in force only if at least 75% of the eligible
5-7 employees or if an association of employees is the policyholder,
5-8 75% of the eligible members of said association, excluding any as
5-9 to whom evidence of individual insurability is not satisfactory to
5-10 the insurer, elect to make the required premium contributions and
5-11 become insured thereunder. Any group policies heretofore issued
5-12 to any of the groups named in Section 1(3) above and in existence
5-13 on the effective date of this Act shall continue in force even
5-14 though the number of employees or members insured thereunder is
5-15 less than 75% of the eligible employees or members on the effective
5-16 date of this Act.
5-17 (c) The policy must cover at least ten (10)
5-18 employees at date of issue, or if an association of employees is
5-19 the policyholder, ten (10) members of said association at date of
5-20 issue.
5-21 (d) The term employees as used herein in
5-22 addition to its usual meaning shall include elective and appointive
5-23 officials of the state.
5-24 (4) A policy issued to a creditor, who shall be deemed
5-25 the policyholder, to insure debtors of the creditor, subject to the
5-26 following requirements:
5-27 (a) The debtors eligible for insurance under the
6-1 policy shall all be members of a group of persons numbering not
6-2 less than fifty (50) at all times, who become borrowers, or
6-3 purchasers of securities, merchandise or other property, under
6-4 agreement to repay the sum borrowed or to pay the balance of the
6-5 price of the securities, merchandise or other property purchased,
6-6 to the extent of their respective indebtedness, but not to exceed
6-7 Fifty Thousand Dollars ($50,000.00) on any one life or not to
6-8 exceed One Hundred Twenty-Five Thousand Dollars ($125,000.00) on
6-9 any one life if the indebtedness is secured by a first lien on real
6-10 estate; provided, however, the face amount of any loan or loan
6-11 commitment, totally or partially executed, made to a debtor for
6-12 educational purposes or to a debtor with seasonal income by a
6-13 creditor in good faith for general agricultural or horticultural
6-14 purposes, secured or unsecured, where the debtor becomes personally
6-15 liable for the payment of such loan, may be so insured in an
6-16 initial amount of such insurance not to exceed the total amount
6-17 repayable under the contract of indebtedness and, when such
6-18 indebtedness is repayable in substantially equal installments, the
6-19 amount of insurance shall at no time exceed the scheduled or actual
6-20 amount of unpaid indebtedness, whichever is greater, and such
6-21 insurance on such credit commitments not exceeding one year in
6-22 duration may be written up to the amount of the loan commitment on
6-23 a nondecreasing or level term plan, but such insurance shall not
6-24 exceed One Hundred Thousand Dollars ($100,000.00) on any one life.
6-25 (b) The premium for the policy shall be paid by
6-26 the policyholder, either from the creditor's funds or from charges
6-27 collected from the insured debtors, or both.
7-1 (c) The insurance issued shall not include
7-2 annuities or endowment insurance.
7-3 (d) The insurance shall be payable to the
7-4 policyholder. Such payment shall reduce or extinguish the unpaid
7-5 indebtedness of the debtor to the extent of such payment; provided
7-6 that in the case of a debtor for educational purposes or of a
7-7 debtor with seasonal income, under a loan or loan commitment for
7-8 general agricultural or horticultural purposes of the type
7-9 described in paragraph (a), the insurance in excess of the
7-10 indebtedness to the creditor, if any, shall be payable to the
7-11 estate of the debtor or under the provision of a facility of
7-12 payment clause.
7-13 (5) A policy issued to the trustees of a fund
7-14 established by two or more employers in the same industry or by one
7-15 or more labor unions, or to the trustees of a fund established by
7-16 one or more employers in the same industry and one or more labor
7-17 unions, or by one or more employers and one or more labor unions
7-18 whose members are in the same or related occupations or trades,
7-19 which trustees shall be deemed the policyholder, to insure
7-20 employees of the employers or members of the unions for the benefit
7-21 of persons other than the employers or the union, subject to the
7-22 following requirements:
7-23 (a) The persons eligible for insurance shall be
7-24 all of the employees of the employers and the employees of the
7-25 trade association of such employers or all of the members of the
7-26 union, or all of any class or classes thereof determined by
7-27 conditions pertaining to their employment, or to membership in the
8-1 unions, or both. The policy may provide that the term "employees"
8-2 shall include retired employees, and the individual proprietor or
8-3 partners if an employer is an individual proprietor or a
8-4 partnership. No director of a corporate employer shall be eligible
8-5 for insurance under the policy unless such person is otherwise
8-6 eligible as a bona fide employee of the corporation by performing
8-7 services other than the usual duties of a director. No individual
8-8 proprietor or partner shall be eligible for insurance under the
8-9 policy unless he is actively engaged in and devotes a substantial
8-10 part of his time to the conduct of the business of the proprietor
8-11 or partnership. The policy may provide that the term "employees"
8-12 shall include the trustees or their employees, or both, if their
8-13 duties are principally connected with such trusteeship.
8-14 (b) The premium for the policy shall be paid by
8-15 the trustees wholly from funds contributed by the employer or
8-16 employers of the insured persons, or by the union or unions, or by
8-17 both, or, partly from such funds and partly from funds contributed
8-18 by the insured persons, except that in no event shall the
8-19 contribution by an insured person toward the cost of his insurance
8-20 exceed forty cents per thousand per month. A policy on which part
8-21 of the premium is to be derived from funds contributed by the
8-22 insured persons specifically for their insurance may be placed in
8-23 force only if at least seventy-five percent (75%) of the then
8-24 eligible persons of each participating employer unit, excluding any
8-25 as to whom evidence of insurability is not satisfactory to the
8-26 insurer, elect to make the required contributions. A policy on
8-27 which no part of the premium is to be derived from funds
9-1 contributed by the insured persons specifically for their insurance
9-2 must insure all eligible persons, or all except any as to whom
9-3 evidence of individual insurability is not satisfactory to the
9-4 insurer. The policy may provide that a participating employer or
9-5 labor union may pay the premium directly to the insurer for the
9-6 policy issued to the trustee, and in that event, the employer or
9-7 labor union becomes the premium payor for the insured employees or
9-8 union members for that employer unit.
9-9 (c) The policy must cover at date of issue at
9-10 least one hundred (100) persons; unless the policy is issued to the
9-11 trustees of a fund established by employers which have assumed
9-12 obligations through a collective bargaining agreement and are
9-13 participating in the fund either pursuant to those obligations with
9-14 regard to one or more classes of their employees which are
9-15 encompassed in the collective bargaining agreement or as a method
9-16 of providing insurance benefits for other classes of their
9-17 employees, or unless the policy is issued to the trustees of a fund
9-18 established by one or more labor unions.
9-19 (d) The amounts of insurance under the policy
9-20 must be based upon some plan precluding individual selection either
9-21 by the insured persons or by the policyholder or employer. No
9-22 policy may be issued which provides term insurance on any person
9-23 which together with any other term insurance under any group life
9-24 insurance policy or policies issued to trustees or employers
9-25 exceeds Two <One> Hundred Fifty Thousand Dollars ($250,000.00)
9-26 <($100,000.00)>, unless seven <four> hundred percent <(400%)> of
9-27 the annual compensation of such employee from his employer or
10-1 employers exceeds Two <One> Hundred Fifty Thousand Dollars
10-2 ($250,000.00) <($100,000.00)>, in which event all such term
10-3 insurance shall not exceed seven <four> hundred percent <(400%)> of
10-4 such annual compensation.
10-5 (e) The limitation as to amount of group
10-6 insurance on any person shall not apply to group insurance on other
10-7 than the term plan where such insurance is to be used to fund the
10-8 benefits under a pension plan and the amount of such insurance does
10-9 not exceed that required to provide at normal retirement date the
10-10 pension specified by the plan, and except that a group policy which
10-11 is issued by the same or another carrier to replace another group
10-12 policy may provide term insurance not to exceed the amount provided
10-13 by the policy which it replaces, or the amounts provided above
10-14 whichever is greater.
10-15 (f) No policy may be issued (i) to insure
10-16 employees of any employer whose eligibility to participate in the
10-17 fund as an employer arises out of considerations directly related
10-18 to the employer being a commercial correspondent or business client
10-19 or patron of another employer (regardless of whether such other
10-20 employer is or is not participating in the fund); or (ii) to insure
10-21 employees of any employer which is not located in this state,
10-22 unless the majority of the employers whose employees are to be
10-23 insured are located in this state, or unless the policy is issued
10-24 to the trustees of a fund established by one or more labor unions.
10-25 (5A) A policy issued to an association or trust for a
10-26 group of individuals for the payment of future funeral expenses.
10-27 (6) A policy issued to cover any other group subject
11-1 to the following requirements:
11-2 (a) No such group life insurance policy shall be
11-3 delivered in this state unless the Commissioner of Insurance finds
11-4 that:
11-5 (i) the issuance of such group policy is
11-6 not contrary to the best interest of the public;
11-7 (ii) the issuance of the group policy
11-8 would result in economies of acquisition or administration; and
11-9 (iii) the benefits are reasonable in
11-10 relation to the premiums charged.
11-11 (b) No such group life insurance coverage may be
11-12 offered in this state by an insurer under a policy issued in
11-13 another state unless this state or another state having
11-14 requirements substantially similar to those contained in Paragraph
11-15 (a) of Subdivision (6) has made a determination that such
11-16 requirements have been met.
11-17 (c) The premium for the policy shall be paid
11-18 either from the policyholder's funds or from funds contributed by
11-19 the covered person or from both.
11-20 (d) Notwithstanding other provisions of law, an
11-21 employer may insure the lives of its officers, directors,
11-22 employees, and retirees under this subdivision for the purpose of
11-23 and in an amount necessary to provide funds to offset fringe
11-24 benefit-related liabilities. Evidence of the purpose of the policy
11-25 shall be submitted to the Commissioner of Insurance. A policy
11-26 issued for such purpose shall not diminish other life insurance
11-27 benefits if any are offered or provided by such employer. The
12-1 provisions of Subdivisions 5 through 10 of Section 2 of this
12-2 article shall not apply to such policies.
12-3 (7) No policy of wholesale, franchise or employee life
12-4 insurance, as hereinafter defined, shall be issued or delivered in
12-5 this state unless it conforms to the following requirements:
12-6 (a) Wholesale, franchise or employee life
12-7 insurance is hereby defined as: a term life insurance plan under
12-8 which a number of individual term life insurance policies are
12-9 issued at special rates to a selected group. A special rate is any
12-10 rate lower than the rate shown in the issuing insurance company's
12-11 manual for individually issued policies of the same type and to
12-12 insureds of the same class.
12-13 (b) Wholesale, franchise or employee life
12-14 insurance may be issued to (1) the employees of a common employer
12-15 or employers, covering at date of issue not less than five
12-16 employees; or (2) the members of a labor union or unions covering
12-17 at date of issue not less than five members; or (3) the members of
12-18 a credit union or credit unions covering at date of issue not less
12-19 than five (5) members.
12-20 (c) The premium for the policy shall be paid
12-21 either wholly from funds contributed by the employer or employers
12-22 of the insured persons, or by the union or unions or by both, or
12-23 partly from such funds and partly from funds contributed by the
12-24 insured person, except that in no event shall the contribution by
12-25 an insured person toward the cost of his insurance exceed forty
12-26 cents per thousand per month.
12-27 (d) No policy may be issued on a wholesale,
13-1 franchise or employee life insurance basis which, together with any
13-2 other term life insurance policy or policies issued on a wholesale,
13-3 franchise, employee life insurance or group basis, provides term
13-4 life insurance coverage for an amount in excess of Two <One>
13-5 Hundred Fifty Thousand Dollars ($250,000.00) <($100,000.00)>,
13-6 unless seven <four> hundred percent <(400%)> of the annual
13-7 compensation of such employee from his employer or employers
13-8 exceeds Two <One> Hundred Fifty Thousand Dollars ($250,000.00)
13-9 <($100,000.00)>, in which event all such term insurance shall not
13-10 exceed seven <four> hundred percent <(400%)> of such annual
13-11 compensation. An individual application shall be taken for each
13-12 such policy and the insurer shall be entitled to rely upon the
13-13 applicant's statements as to applicant's other similar coverage
13-14 upon his life.
13-15 (e) Each such policy of insurance shall contain
13-16 a provision substantially as follows:
13-17 A provision that if the insurance on an insured person ceases
13-18 because of termination of employment or of membership in the union,
13-19 such person shall be entitled to have issued to him by the insurer,
13-20 without evidence of insurability an individual policy of life
13-21 insurance without disability or other supplementary benefits,
13-22 provided application for the individual policy shall be made, and
13-23 the first premium paid to the insurer, within thirty-one (31) days
13-24 after such termination.
13-25 (f) Each such policy may contain any provision
13-26 substantially as follows:
13-27 (1) A provision that the policy is
14-1 renewable at the option of the insurer only;
14-2 (2) A provision for termination of
14-3 coverage by the insurer upon termination of employment by the
14-4 insured employee;
14-5 (3) A provision requiring a person
14-6 eligible for insurance to furnish evidence of individual
14-7 insurability satisfactory to the insurer as condition to coverage.
14-8 (g) The limitation as to amount of group and
14-9 wholesale, franchise or employee life insurance on any person shall
14-10 not apply to group insurance on other than the term plan where such
14-11 insurance is to be used to fund benefits under a pension plan and
14-12 the amount of such insurance does not exceed that required to
14-13 provide at normal retirement date the pension specified by the
14-14 plan, and except that a group policy which is issued by the same or
14-15 another carrier to replace another group policy may provide term
14-16 insurance not to exceed the amounts provided by the policy which it
14-17 replaces, or the amounts provided above, whichever are greater.
14-18 (h) Nothing contained in this Subsection (7)
14-19 shall in any manner alter, impair or invalidate (1) any policy
14-20 heretofore issued prior to the effective date of this Act; nor (2)
14-21 any such plan heretofore placed in force and effect provided such
14-22 prior plan was at date of issue legal and valid; nor (3) any policy
14-23 issued on a salary savings franchise plan, bank deduction plan,
14-24 pre-authorized check plan or similar plan of premium collection.
14-25 (7A) A policy may be issued to a principal, or if such
14-26 principal is a life or life and accident or life, accident and
14-27 health insurer, by or to such principal, covering when issued not
15-1 less than ten (10) agents of the principal, subject to the
15-2 following requirements:
15-3 (a) As used in this section, the term "agents"
15-4 shall be deemed to include general agents, subagents and salesmen.
15-5 (b) The agents eligible for insurance under the
15-6 policy shall be those who are under contract to render personal
15-7 services for the principal for a commission or other fixed or
15-8 ascertainable compensation.
15-9 (c) The premium for the policy shall be paid
15-10 either wholly by the principal or partly from funds contributed by
15-11 the principal and partly from funds contributed by the insured
15-12 agents. A policy on which no part of the premium is to be derived
15-13 from funds contributed by the insured agents must insure all of the
15-14 eligible agents or all of any class or classes thereof determined
15-15 by conditions pertaining to the services to be rendered by the
15-16 agents to the principal. A policy on which part of the premium is
15-17 to be derived from funds contributed by the insured agents must
15-18 cover at issue at least seventy-five percent (75%) of the eligible
15-19 agents or at least seventy-five percent (75%) of any class or
15-20 classes thereof determined by conditions pertaining to the services
15-21 to be rendered by the agents; provided, however, that the benefits
15-22 may be extended to other classes of agents as seventy-five percent
15-23 (75%) thereof express the desire to be covered.
15-24 (d) The amounts of insurance under the policy
15-25 must be based upon some plan precluding individual selection either
15-26 by the principal or by the agents. No policy may be issued which
15-27 provides term insurance on any agent which together with any other
16-1 term insurance under any group life insurance policy or policies
16-2 issued to the principal exceeds Two <One> Hundred Fifty Thousand
16-3 Dollars ($250,000.00) <($100,000.00)>, unless seven <four> hundred
16-4 percent <(400%)> of the annual commissions or other fixed or
16-5 ascertainable compensation of such agent from the principal exceeds
16-6 Two <One> Hundred Fifty Thousand Dollars ($250,000.00)
16-7 <($100,000.00)>, in which event all such term insurance shall not
16-8 exceed seven <four> hundred percent <(400%)> of such annual
16-9 commissions or other fixed or ascertainable compensation.
16-10 (e) The insurance shall be for the benefit of
16-11 persons other than the principal.
16-12 (8) A policy issued to the Veterans Land Board of the
16-13 State of Texas, who shall be deemed the policyholder to insure
16-14 persons purchasing land under the Texas Veterans Land Program as
16-15 provided in Subchapter I, Chapter 161, Natural Resources Code
16-16 <Section 16(B) of Article 5421m, Vernon's Texas Civil Statutes
16-17 (Chapter 318, Acts of the 51st Legislature, Regular Session, 1949,
16-18 as amended)>.
16-19 (9) Any policy of group term life insurance may be
16-20 extended, in the form of group term life insurance only, to insure
16-21 the spouse and minor children, natural or adopted, of an insured
16-22 employee, provided the policy constitutes a part of the employee
16-23 benefit program established for the benefit of employees of the
16-24 United States government or any subdivision thereof, and provided
16-25 further, that the spouse or children of other employees covered by
16-26 the same employee benefit program in other states of the United
16-27 States are or may be covered by group term life insurance, subject
17-1 to the following requirements:
17-2 (a) The premiums for the group term life
17-3 insurance shall be paid by the policyholder from funds solely
17-4 contributed by the insured employee.
17-5 (b) The amounts of insurance under the policy
17-6 must be based upon some plan precluding individual selection either
17-7 by the insured employee or by the policyholder, provided that group
17-8 term life insurance upon the life of a spouse shall not exceed the
17-9 lesser of (1) Ten Thousand Dollars ($10,000.00) or (2) one-half of
17-10 the amount of insurance on the life of the insured employee under
17-11 the group policy; and provided that group term life insurance on
17-12 the life of any minor child shall not exceed Two Thousand Dollars
17-13 ($2,000.00).
17-14 (c) Upon termination of the group term life
17-15 insurance with respect to the spouse of any insured employee by
17-16 reason of such person's termination of employment or death, or
17-17 termination of the group contract, the spouse insured pursuant to
17-18 this section shall have the same conversion rights as to the group
17-19 term life insurance on his or her life as is provided for the
17-20 insured employee.
17-21 (d) Only one certificate need be issued for
17-22 delivery to an insured employee if a statement concerning any
17-23 dependent's coverage is included in such certificate.
17-24 (10) A policy of group life insurance may be issued to
17-25 a nonprofit service, civic, fraternal, or community organization or
17-26 association which has had an active existence for at least two
17-27 years, has a constitution or bylaws, was formed for purposes other
18-1 than obtaining insurance, and which association shall be deemed the
18-2 policyholder to insure members and employees of such association
18-3 for the benefit of persons other than the association or any of its
18-4 officers, subject to the following requirements:
18-5 (a) The persons eligible for insurance shall be
18-6 all the members of the association, or all of any class thereof
18-7 determined by conditions pertaining to membership in the
18-8 association.
18-9 (b) The amounts of insurance under the policy
18-10 shall be based upon some plan precluding individual selection
18-11 either by the insured members or by the association.
18-12 (c) The premium for the policy shall be paid by
18-13 the policyholder from the policyholder's own funds or from funds
18-14 contributed by the employees or members specifically for their
18-15 insurance, or from both. The policy may provide that the premium
18-16 may be paid directly to the insurer by individual employees or
18-17 members from their own funds, and in that event, the respective
18-18 employees or members become the premium payor for that particular
18-19 certificate.
18-20 (d) The policy shall cover at least twenty-five
18-21 (25) persons at date of issue.
18-22 SECTION 2. This Act takes effect September 1, 1995, and
18-23 applies only to an insurance policy that is delivered, issued for
18-24 delivery, or renewed on or after January 1, 1996. A policy
18-25 delivered, issued for delivery, or renewed before January 1, 1996,
18-26 is governed by the law as it existed immediately before the
18-27 effective date of this Act, and that law is continued in effect for
19-1 that purpose.
19-2 SECTION 3. The importance of this legislation and the
19-3 crowded condition of the calendars in both houses create an
19-4 emergency and an imperative public necessity that the
19-5 constitutional rule requiring bills to be read on three several
19-6 days in each house be suspended, and this rule is hereby suspended.