By Duncan                                             H.B. No. 1280
       74R4499 DLF-F
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to certain acts of unfair discrimination in the business
    1-3  of insurance.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Article 21.21-5, Insurance Code, is amended to
    1-6  read as follows:
    1-7        Art. 21.21-5.  Unfair Discrimination in Rates, <or> Renewal,
    1-8  or Issuance of Coverage.  (a)  This article applies to any insurer
    1-9  authorized to do business as an insurance company or to provide
   1-10  insurance in this state, including:
   1-11              (1)  a capital stock company;
   1-12              (2)  a mutual company;
   1-13              (3)  a title insurance company;
   1-14              (4)  a fraternal benefit society;
   1-15              (5)  a local mutual aid association;
   1-16              (6)  a statewide mutual assessment company;
   1-17              (7)  a county mutual insurance company;
   1-18              (8)  a Lloyd's plan company;
   1-19              (9)  a reciprocal or interinsurance exchange;
   1-20              (10)  a stipulated premium insurance company;
   1-21              (11)  a group hospital service company;
   1-22              (12)  a health maintenance organization;
   1-23              (13)  a farm mutual insurance company;
   1-24              (14)  a risk retention group; and
    2-1              (15)  a surplus lines carrier.
    2-2        (b)  An insurer may not refuse to issue or renew a policy,
    2-3  contract, or evidence of coverage:
    2-4              (1)  based on the <discriminate on the basis of> race,
    2-5  color, religion, or national origin of an individual; or
    2-6              (2)  based on geographic<, and, to the extent not
    2-7  justified by sound actuarial principles, on the basis of
    2-8  geographical> location, disability, gender <sex>, or age unless the
    2-9  action is the result of the application of sound underwriting or
   2-10  actuarial principles related to actual or reasonably anticipated
   2-11  loss experience<, in the setting or use of rates or rating manuals
   2-12  and in the nonrenewal of policies>.
   2-13        (c)  An insurer may not use or set rates or rating manuals
   2-14  that are:
   2-15              (1)  based on the race, color, religion, or national
   2-16  origin of an individual; or
   2-17              (2)  based on geographic location, disability, gender,
   2-18  or age unless the action is the result of the application of sound
   2-19  underwriting or actuarial principles related to actual or
   2-20  reasonably anticipated loss experience.
   2-21        (d)  An insurer that violates this article is subject to:
   2-22              (1)  sanctions imposed under Section 7, Article 1.10,
   2-23  of this code, including administrative penalties authorized under
   2-24  Article 1.10E of this code; and
   2-25              (2)  cease and desist procedures authorized by Article
   2-26  1.10A of this code.
   2-27        SECTION 2.  This Act takes effect September 1, 1995.
    3-1        SECTION 3.  The importance of this legislation and the
    3-2  crowded condition of the calendars in both houses create an
    3-3  emergency and an imperative public necessity that the
    3-4  constitutional rule requiring bills to be read on three several
    3-5  days in each house be suspended, and this rule is hereby suspended.