SRC-CDH H.B. 2873 75(R)   BILL ANALYSIS


Senate Research Center   H.B. 2873
By: Goodman (Ellis)
Economic Development
5-11-97
Engrossed


DIGEST 

Currently, the Insurance Code defines "large risk" as an insured that has
total insured property values of $10 million or more; total annual gross
revenues of $20 million or more; or a total premium of $50,000 or more for
property insurance, $50,000 or more for general liability insurance, or
$100,000 or more for multiperil insurance.  Typically, these large risks
are businesses that have the sophistication and knowledge to evaluate
policies and prefer the flexibility to choose coverage that varies from
promulgated forms.  H.B. 2873 would change the definition of "large risk"
to an insured that has total insured property values of $5 million or
more; total annual gross revenues of $10 million or more; or total premium
of $25,000 or more for property insurance, $25,000 or more for general
liability insurance, or $50,000 or more for multiperil insurance. 

PURPOSE

As proposed, H.B. 2873 establishes provisions regarding policy forms for
certain large risk insurance policies. 

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 8(f), Article 5.13-2, Insurance Code, to define
"large risk" to mean an insured that has total insured property values of
$5 million or more; total annual gross revenues of $10 million or more; or
a total premium of $25,000 or more for property insurance, $25,000 or more
for general liability insurance, or $50,000 or more for multiperil
insurance.  Deletes existing text regarding property values, total annual
gross revenues, and total premiums constituting a "large risk." 

SECTION 2. Emergency clause.
  Effective date:  90 days after adjournment.