SRC-JFA S.B. 1378 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 1378
By: Ellis
Economic Development
4-22-97
As Filed


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 total premium of $50,000 or more for
property, $50,000 or more for general liability, or $100,000 or more for
multiperil insurance.  These large risk businesses are usually entities
that have the sophistication and knowledge to evaluate polices and usually
prefer the flexibility to choose coverage that varies from promulgated
forms.  This bill would change the definition of "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 total premium of
$25,000 or more for property, $25,000 or more for general liability, or
$50,000 or more for multi-peril insurance.      

PURPOSE

As proposed, S.B. 1378 redefines "large risk" as set forth in Section
8(f), Article 5.13-2, Insurance Code, relating to rates for general
liability and commercial property insurance coverage.   

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 provide
that for purposes of this subsection, "large risk" means an insured that
has total insured property values of $5 million, rather than $10 million,
or more; an insured that has total annual gross revenues of $10 million,
rather than $20 million, or more; or an insured that has a total premium
of $25,000, rather than $50,000, or more for property insurance, $25,000,
rather than $50,000, or more for general liability insurance, or $50,000,
rather than $100,000, or more for multi-peril insurance. 

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