By Counts                                       H.B. No. 1662

      75R7069 DLF-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to rates for certain lines of insurance.


 1-4           SECTION 1.  Section 3, Article 5.101, Insurance Code, is

 1-5     amended by adding Subsection (r) to read as follows:

 1-6           (r)  Notwithstanding any other provision of this article, a

 1-7     county mutual insurance company may not use a rate for an insured

 1-8     that, after the application of all discounts, is lower than the

 1-9     highest rate allowed under the flexibility band for that line if

1-10     the county mutual insurance company is:

1-11                 (1)  wholly owned by any other insurance company,

1-12     including a reciprocal or interinsurance exchange; or

1-13                 (2)  directly or indirectly controlled by a holding

1-14     company, as that term is defined by Article 21.49-1 of this code,

1-15     that also directly or indirectly controls another insurance

1-16     company, including a reciprocal or interinsurance exchange.

1-17           SECTION 2.  This Act applies only to a rate applicable to an

1-18     insurance policy that is delivered, issued for delivery, or renewed

1-19     on or after January 1, 1998.  A rate applicable to an insurance

1-20     policy that is delivered, issued for delivery, or renewed before

1-21     January 1, 1998, is governed by the law as it existed immediately

1-22     before the effective date of this Act, and that law is continued in

1-23     effect for this purpose.

1-24           SECTION 3.  This Act takes effect September 1, 1997.

 2-1           SECTION 4.  The importance of this legislation and the

 2-2     crowded condition of the calendars in both houses create an

 2-3     emergency and an imperative public necessity that the

 2-4     constitutional rule requiring bills to be read on three several

 2-5     days in each house be suspended, and this rule is hereby suspended.