SRC-HRD H.B. 1287 75(R)   BILL ANALYSIS


Senate Research Center   H.B. 1287
By: Counts (Duncan)
Economic Development
5-14-97
Engrossed


DIGEST 

Currently, the statute governing operations of the Texas Title Insurance
Guaranty Association (association), Article 9.48, Insurance Code, does not
clearly define the procedure for  the return of assessments or authorize
the association to transfer funds from its administrative  account.  This
bill will address both problems by amending Section 9 of  Article 9.48.
These changes would allow excess funds in the association accounts to go
to the guaranty fee account where it can be used to fund the title
examiners.                                                          

The association has three accounts specified by statute.  The guaranty fee
account is for receipt of guaranty fees collected on title policies and is
used to pay the expenses of the title examiners employed  by the
commissioner of insurance and the covered claims of title agents.  The
title account is for receipt of funds assessed against member insurers and
used to pay covered claims of insolvent insurers.  The administrative
account is for receipt of investment income from the other accounts and is
used to pay the administrative expenses of the association.

H.B. 1287 would clarify the procedure for transferring funds between the
three association accounts, state the purpose of the funds, and define how
this money is disbursed.           

PURPOSE

As proposed, H.B. 1287 clarifies the procedure for transferring funds
between the three Texas Title Insurance Guaranty Association accounts,
states the purpose of the funds, and defines how this money is disbursed.

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 9, Article 9.48, Insurance Code (Texas Title
Insurance Guaranty Act), by amending Subsection (b) and by adding
Subsection (c), to provide that should the Texas Title Insurance Guaranty
Assocation (association) at any time determine that money exists in the
title account, rather than in the administrative account or the title
account, in excess of a certain amount, it shall cause the excess money to
be returned pro rata to the holders of any participation receipts on which
there is a balance outstanding after deducting any credits taken against
premium taxes as authorized by Section 15 of this article.  Requires any
excess money remaining in the title account after the distribution to be
transferred, rather than retained, by the association to the guaranty fee
account to be used as provided by, rather than held pursuant to, this
article.  Requires the association to transfer the excess money to the
guaranty fee account to be used as provided by this article, under certain
conditions. 

SECTION 2. Emergency clause.
  Effective date: upon passage.