By: Ellis S.B. No. 829
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the establishment of market assistance programs by the
1-2 Commissioner of Insurance.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Article 21.49-12, Insurance Code, is amended to
1-5 read as follows:
1-6 Art. 21.49-12. Market Assistance Programs
1-7 Sec. 1. Creation of programs. The commissioner <State Board
1-8 of Insurance> may establish a voluntary mechanism to be called a
1-9 market assistance program to assist insureds in Texas in obtaining
1-10 <liability> insurance coverage where it has been shown not to be
1-11 readily available. The types of risks to be assisted under each
1-12 market assistance program will be established by the commissioner
1-13 <board>.
1-14 Sec. 2. Plan of operation. Each market assistance program
1-15 shall be administered under a plan of operation promulgated by the
1-16 commissioner <board>. Each plan shall indicate types of coverage,
1-17 policy forms and terms, application forms, eligibility, and overall
1-18 operation of the program. The commissioner <board> may not require
1-19 an insurer to participate in the program, and the commissioner <but
1-20 the board> may not permit an insurer to condition its participation
1-21 in a manner that is inequitable to the participants.
1-22 Sec. 3. Executive committee. (a) An executive committee
1-23 shall administer each market assistance program.
2-1 (b) The commissioner <board> shall appoint the members of an
2-2 executive committee.
2-3 (c) The commissioner or the commissioner's designated
2-4 representative from the department shall chair <At least one member
2-5 of the board must be designated a member of> the executive
2-6 committee.
2-7 (d) The plan of operation may provide for subcommittees that
2-8 are necessary to carry out the functions of a program.
2-9 (e) A representative of the commissioner <board> must be
2-10 present in every meeting of an executive committee or subcommittee.
2-11 Sec. 4. Agents. (a) Notwithstanding any other provision of
2-12 law, a market assistance program may have two categories of agents:
2-13 (1) an originating agent; and
2-14 (2) an issuing agent.
2-15 (b) An originating agent may complete an application for
2-16 insurance on behalf of an insured for submission to the program
2-17 without being appointed to represent the ultimate insurer.
2-18 (c) An issuing agent must be appointed to represent the
2-19 ultimate insurer and shall perform all of the customary duties of
2-20 an <a local recording> agent for the type of coverage provided
2-21 <including but not limited to the following:>
2-22 <(1) signing, executing, and delivering policies of
2-23 insurance;>
2-24 <(2) maintaining a record of the business;>
2-25 <(3) examining and inspecting the risk; and>
3-1 <(4) receiving and collecting premiums>.
3-2 (d) An originating agent may share commissions, as
3-3 negotiated on an individual basis, with the issuing agent if the
3-4 originating agent holds a license as either an <a local recording>
3-5 agent or as a salaried representative for those companies whose
3-6 plan of operation does not contemplate the use of <local recording>
3-7 agents.
3-8 (e) The originating and issuing agent may be the same
3-9 person. If the originating agent and the issuing agent are not the
3-10 same person, the originating agent may not be held to be the agent
3-11 of the insurer unless there is an appointment as specified by
3-12 Article 21.14 of this code.
3-13 (f) The program may not share in commissions.
3-14 (g) This section shall not be construed to amend or
3-15 otherwise alter the contractual relationship between an insurer and
3-16 its agent. This section does not require insurers to appoint
3-17 additional agents.
3-18 Sec. 5. Fees. The plan of operation may provide reasonable
3-19 application fees to be used to cover expenses of the program.
3-20 These fees must be maintained in a separate account under the
3-21 control of a fiscal agent designated in the plan of operation.
3-22 Sec. 6. Confidentiality. (a) The commissioner and the
3-23 department <State Board of Insurance> shall maintain as
3-24 confidential all application files and related documents received
3-25 under this article.
4-1 (b) In maintaining confidentiality, the commissioner and the
4-2 department <State Board of Insurance> shall not permit the files
4-3 and related documents to be made available to the public except
4-4 that the commissioner and the department <State Board of Insurance>
4-5 shall allow access to those files and related documents to
4-6 originating or issuing agents or to an applicant for his own file
4-7 or to an insurer who agrees to insure the applicant.
4-8 SECTION 2. The importance of this legislation and the
4-9 crowded condition of the calendars in both houses create an
4-10 emergency and an imperative public necessity that the
4-11 constitutional rule requiring bills to be read on three several
4-12 days in each house be suspended, and this rule is hereby suspended.