AN ACT

 1-1     relating to the payments of insurance benefits for a child to the

 1-2     possessory or managing conservator of the child.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Sections 1, 2, and 3, Article 3.51-13, Insurance

 1-5     Code, are amended to read as follows:

 1-6           Sec. 1.  An insurer or group hospital service company that

 1-7     delivers, issues for delivery, or renews a group accident and

 1-8     sickness insurance policy in this state, including a policy issued

 1-9     by a company subject to Chapter 20 of this code, that provides

1-10     coverage for a minor child who otherwise qualifies as a dependent

1-11     of a person who is a member of the group may pay benefits on behalf

1-12     of the child to the person who is not a member of the group if a

1-13     court order providing for the appointment of a possessory or

1-14     managing conservator of the child has been issued by a court of

1-15     competent jurisdiction in this or any other state.

1-16           Sec. 2.  A group accident and sickness insurance policy

1-17     issued by an insurer or group hospital service company may be

1-18     required to pay benefits pursuant to the terms of the policy and as

1-19     provided by this article on compliance by the person who is not a

1-20     member of the group with the requirements of this article, claim

1-21     application procedures of the insurer or company, and rules of the

1-22     State Board of Insurance.  However, any requirements imposed on a

1-23     possessory or [the] managing conservator of the child shall not

 2-1     apply in the case of any unpaid medical bill for which a valid

 2-2     assignment of benefits has been exercised in accordance with policy

 2-3     provisions or otherwise, nor to claims submitted by the group

 2-4     member where the group member has paid any portion of a medical

 2-5     bill that would be covered under the terms of the policy.

 2-6           Sec. 3.  Before a person who is not a member of a group is

 2-7     entitled to be paid benefits under Section 1 of this article, the

 2-8     person must submit to the insurer or company with the claim

 2-9     application written notice that the person:

2-10                 (1)  is a possessory or [the] managing conservator of

2-11     the child on whose behalf the claim is made; and

2-12                 (2)  submit a certified copy of a court order

2-13     establishing the person as possessory or managing conservator or

2-14     other evidence designated by rule of the State Board of Insurance

2-15     that the person qualifies to be paid the benefits as provided by

2-16     this article.

2-17           SECTION 2.  This Act takes effect September 1, 1997, and

2-18     applies only to an insurance policy that is delivered, issued for

2-19     delivery, or renewed on or after January 1, 1998.  A policy that is

2-20     delivered, issued for delivery, or renewed before January 1, 1998,

2-21     is governed by the law as it existed immediately before the

2-22     effective date of this Act, and that law is continued in effect for

2-23     this purpose.

2-24           SECTION 3.  The importance of this legislation and the

2-25     crowded condition of the calendars in both houses create an

 3-1     emergency and an imperative public necessity that the

 3-2     constitutional rule requiring bills to be read on three several

 3-3     days in each house be suspended, and this rule is hereby suspended.

         _______________________________     _______________________________

             President of the Senate              Speaker of the House

               I hereby certify that S.B. No. 333 passed the Senate on

         February 26, 1997, by the following vote:  Yeas 31, Nays 0.

                                             _______________________________

                                                 Secretary of the Senate

               I hereby certify that S.B. No. 333 passed the House on

         May 26, 1997, by a non-record vote.

                                             _______________________________

                                                 Chief Clerk of the House

         Approved:

         _______________________________

                     Date

         _______________________________

                   Governor