1-1 AN ACT
1-2 relating to financial solvency requirements for certain property
1-3 and casualty insurers.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subsection (f), Article 2.20, Insurance Code, is
1-6 amended to read as follows:
1-7 (f) Notwithstanding any other provision of this code other
1-8 than Subsection (b) of this article, for insurers that write
1-9 business only in this state and that [which] are not required by
1-10 law to have capital stock, the minimum free surplus or guaranty
1-11 fund and free surplus required shall be the greater of that
1-12 required of the insurer immediately prior to the effective date of
1-13 this article or one-third of the net written premium of the insurer
1-14 for the preceding 12 months after deducting:
1-15 (1) lawfully ceded reinsurance; and
1-16 (2) policy fees, if any, not ceded to reinsurers.
1-17 SECTION 2. This Act takes effect September 1, 1997.
1-18 SECTION 3. The change in law made by this Act applies only
1-19 to the minimum free surplus or guaranty fund and free surplus of an
1-20 insurer on or after January 1, 1998. The minimum free surplus or
1-21 guaranty fund and free surplus of an insurer before January 1,
1-22 1998, is governed by the law as it existed immediately before the
1-23 effective date of this Act, and that law is continued in effect for
1-24 that purpose.
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.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1976 was passed by the House on April
17, 1997, by a non-record vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 1976 was passed by the Senate on May
15, 1997, by the following vote: Yeas 31, Nays 0.
_______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor