1-1 By: Smithee (Senate Sponsor - Sibley) H.B. No. 1976
1-2 (In the Senate - Received from the House April 18, 1997;
1-3 April 22, 1997, read first time and referred to Committee on
1-4 Economic Development; May 7, 1997, reported favorably by the
1-5 following vote: Yeas 6, Nays 0; May 7, 1997, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to financial solvency requirements for certain property
1-9 and casualty insurers.
1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11 SECTION 1. Subsection (f), Article 2.20, Insurance Code, is
1-12 amended to read as follows:
1-13 (f) Notwithstanding any other provision of this code other
1-14 than Subsection (b) of this article, for insurers that write
1-15 business only in this state and that [which] are not required by
1-16 law to have capital stock, the minimum free surplus or guaranty
1-17 fund and free surplus required shall be the greater of that
1-18 required of the insurer immediately prior to the effective date of
1-19 this article or one-third of the net written premium of the insurer
1-20 for the preceding 12 months after deducting:
1-21 (1) lawfully ceded reinsurance; and
1-22 (2) policy fees, if any, not ceded to reinsurers.
1-23 SECTION 2. This Act takes effect September 1, 1997.
1-24 SECTION 3. The change in law made by this Act applies only
1-25 to the minimum free surplus or guaranty fund and free surplus of an
1-26 insurer on or after January 1, 1998. The minimum free surplus or
1-27 guaranty fund and free surplus of an insurer before January 1,
1-28 1998, is governed by the law as it existed immediately before the
1-29 effective date of this Act, and that law is continued in effect for
1-30 that purpose.
1-31 SECTION 4. The importance of this legislation and the
1-32 crowded condition of the calendars in both houses create an
1-33 emergency and an imperative public necessity that the
1-34 constitutional rule requiring bills to be read on three several
1-35 days in each house be suspended, and this rule is hereby suspended.
1-36 * * * * *