SRC-AAA S.B. 1740 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 1740
By: Armbrister
Economic Development
4-16-97
As Filed


DIGEST 

Currently, the law requires the Texas workers' compensation insurance
facility to contract with the  
Texas workers; compensation insurance fund to assume all claim liabilities
of the facility by January 1, 1999.  The facility has ceased writing
workers' compensation insurance under the employers' rejected risk fund on
January 1, 1994, and has since been in the process of preparing for the
contractual transfer of its claim liabilities, and for dissolution.  This
bill would provide for the dissolution of the workers' compensation
insurance facility operation as an independent entity by transferring
control of the facility to the Texas Property and Casualty Insurance
Guaranty Association.  This bill also repeals the requirement that the
facility contract with the workers' compensation insurance fund to assume
its claim liabilities. 
 
PURPOSE

As proposed, S.B. 1740 provides for the dissolution of the workers'
compensation insurance facility operation as an independent entity by
transferring control of the facility to the Texas Property and Casualty
Insurance Guaranty Association.  This bill also repeals the requirement
that the facility contract with the workers' compensation insurance fund
to assume its claim liabilities. 
 
RULEMAKING AUTHORITY

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

SECTION BY SECTION ANALYSIS

SECTION 1. Sets forth the findings and declarations of the legislature.
Sets forth the purpose of this Act.  Requires this Act to be liberally
construed in conformity with the legislative findings and purposes. 

SECTION 2. Requires the members of the governing committee of the Texas
workers' compensation insurance facility (committee) to be deemed to have
resigned and the board of directors of the Texas Property and Casualty
Insurance Guaranty Association (board) to replace the committee on
December 31, 1997. Requires the board to submit a plan to the commissioner
of insurance no later than October 31, 1997. 

SECTION 3. Requires any assessment of members made after January 1, 1997
to be made as provided by Section 18, Insurance Code and subject to
Section 21, Insurance Code. 

SECTION 4. Requires the Texas Property and Casualty Insurance Guaranty
Association to succeed all rights, defenses, immunities, and liabilities
of  the Texas workers' compensation facility  (facility) by or against the
facility on December 31, 1997, and causes of action which arise after that
date related to actions or omissions before that date.  Provides that the
litigation and causes of action are governed under Article 5.76-2,
Insurance Code. 

SECTION 5. Makes application of Sections 2.05(h) and 2.12, Article 5.76-2
Insurance Code retroactive to December 15, 1997.   

SECTION 6. Sets forth indemnity of the Texas workers' compensation
insurance facility or its governing committee, executive director, staff,
agents, servants, attorneys, consultants, employees,  or member insurers. 

SECTION 7. Repealer: Section 18.24(b), Chapter 12, Acts of the 72nd
Legislature, 2nd Called Session, 1991, as amended by Section 8, Chapter
885, Acts of the 73rd Legislature, 1993 (Transitions).  

(b) Repealer: Section 2.03, Article 5.76-2, Insurance Code (Amendments to
charters), effective December 31, 1997. 

SECTION 8. Provides that this Act controls, if in conflict with any other
law or statute. 

SECTION 9. Emergency clause.
  Effective date: upon passage.