1-1 By Smithee H.B. No. 1976
1-2 75R5707 SAW-F
1-3 AN ACT
1-4 relating to financial solvency requirements for certain property
1-5 and casualty insurers.
1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-7 SECTION 1. Subsection (f), Article 2.20, Insurance Code, is
1-8 amended to read as follows:
1-9 (f) Notwithstanding any other provision of this code other
1-10 than Subsection (b) of this article, for insurers that write
1-11 business only in this state and that [which] are not required by
1-12 law to have capital stock, the minimum free surplus or guaranty
1-13 fund and free surplus required shall be the greater of that
1-14 required of the insurer immediately prior to the effective date of
1-15 this article or one-third of the net written premium of the insurer
1-16 for the preceding 12 months after deducting:
1-17 (1) lawfully ceded reinsurance; and
1-18 (2) policy fees, if any, not ceded to reinsurers.
1-19 SECTION 2. This Act takes effect September 1, 1997.
1-20 SECTION 3. The change in law made by this Act applies only
1-21 to the minimum free surplus or guaranty fund and free surplus of an
1-22 insurer on or after January 1, 1998. The minimum free surplus or
1-23 guaranty fund and free surplus of an insurer before January 1,
1-24 1998, is governed by the law as it existed immediately before the
1-25 effective date of this Act, and that law is continued in effect for
1-26 that purpose.
1-27 SECTION 4. The importance of this legislation and the
1-28 crowded condition of the calendars in both houses create an
1-29 emergency and an imperative public necessity that the
1-30 constitutional rule requiring bills to be read on three several
1-31 days in each house be suspended, and this rule is hereby suspended.