Amend HB 1356 on third reading by inserting the following new
sections, appropriately numbered, and renumbering the subsequent
sections accordingly:
      SECTION ____.  Article 3.50-6, Insurance Code, is amended to
read as follows:
      Art. 3.50-6.  PAYMENT OF ACCELERATED LIFE INSURANCE BENEFITS
<DEATH BENEFIT IN EVENT OF TERMINAL ILLNESS OR INJURY>.
      (a)  In this article:
            (1)  "Accelerated benefit" means a benefit paid to an
insured in lieu of a portion of a death benefit.
            (2)  "Death benefit" means a benefit payable to a
beneficiary on the death of an insured.
            (3)  "Long-term care illness" means an illness or
physical condition that results in the inability to perform the
activities of daily life or the substantial and material duties of
any occupation.
            (4)  "Specified disease" means an illness or physical
condition that is likely to cause permanent disability or premature
death, including the following:
                  (A)  acquired immunodeficiency syndrome (AIDS);
                  (B)  a malignant tumor;
                  (C)  a condition that required an organ
transplant; and
                  (D)  a coronary artery disease that results in
acute infarction or requires surgery.
            (5)  "Terminal illness" means an illness or physical
condition, including a physical injury, that can reasonably be
expected to result in death within two years.
      (b)  An insurance company may pay an accelerated benefit
under an individual or <a> group term life insurance policy or
certificate if:
            (1)  the company has received a written medical
opinion, satisfactory to the company, that the insured has a <is
not expected to continue living for more than 12 months because of>
terminal illness, a long-term care illness, or a specified disease
<or injury>; and
            (2)  <the amount of the accelerated benefit does not
exceed the greater of $25,000 or 50 percent of the amount of the
death benefit payable under the policy or certificate; and>
            <(3)> the amount of the accelerated benefit is deducted
from the amount of the death benefit payable under the policy or
certificate and from any amount the insured would otherwise be
entitled to convert to an individual contract.
      (c)  The commissioner may adopt rules to implement this
article.
      SECTION ____.  Article 3.50-6, Insurance Code, as amended by
this Act, applies only to a policy or contract that is delivered,
issued for delivery, or renewed on or after September 1, 1997. A
policy or contract that is delivered, issued for delivery, or
renewed before September 1, 1997, is governed by law as it existed
immediately before that date, and that law is continued in effect
for that purpose.