SRC-AAA S.B. 206 75(R)    BILL ANALYSIS


Senate Research CenterS.B. 206
By: Madla
Economic Development
3-12-97
As Filed


DIGEST 

Currently, the Insurance Code exempts from licensing requirements officers
or employees of an insurance company who engage in the solicitation of
insurance.  The problem is that licensing provisions of the Insurance Code
do not apply equally to all persons engaged in the solicitation of
insurance. This bill  provides who  can sell insurance and who must be
licensed to sell insurance in the State of Texas.    

PURPOSE

As proposed, S.B. 206 provides who is considered an insurance agent, which
insurance employees are covered by the Act, and which insurance companies
are excepted from the Act. 

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 Article 21.02, Insurance Code, to provide that persons
who make oral, written, or electronic communication to solicit insurance
shall be held to be agents of the company for which the solicitation is
done. Makes conforming changes.  

SECTION 2. Amends Section 1, Article 21.07, Insurance Code, to require
each officer or employee of an insurance company who negotiates or
solicits business to be licensed under this article. Provides that a
person negotiates or solicits insurance if by oral, written, or electronic
communication that person communicates to another regarding insurance
coverage, rates, benefits, or policies. 

SECTION 3. Amends Article 21.09, Insurance Code, to require an officer or
employee of an insurance company who solicits business to be licensed
under Article 21.14, Insurance Code. Provides that a person negotiates or
solicits insurance if by oral, written, or electronic communication that
person communicates to another regarding insurance coverage, rates,
benefits, or policies.  Makes conforming changes. 

SECTION 4. Amends Section 20, Article 21.14, Insurance Code,  to provide
that this article does not apply to life, health and accident business or
the life, health and accident department of the companies engaged in that
kind of business, and full-time salaried employees of insurance companies
doing business in Texas, other than employees who negotiate or solicit
insurance. Provides that a person negotiates or solicits insurance if by
oral, written, or electronic communication that person communicates to
another regarding insurance coverage, rates, benefits, or policies. Makes
conforming changes. 

SECTION 5. Effective date: September 1, 1997.
  Applies only to negotiation or solicitation of insurance on or after
January 1, 1998. 

SECTION 6. Emergency clause.