HBA-ATS S.B. 405 76(R)BILL ANALYSIS


Office of House Bill AnalysisS.B. 405
By: Madla
Insurance
4/9/1999
Engrossed



BACKGROUND AND PURPOSE 

Article 3.51-4 (Extension of Group Term Life Insurance to Spouses and
Children), Insurance Code, prohibits the amount of group term life
insurance coverage that may be provided to a Texas employee's spouse or
children under a group term life insurance policy from exceeding one-half
of the amount of insurance on the employee's life.  This prohibition limits
the options of Texas consumers.  S.B. 405 authorizes the extension of
insurance under any lawfully issued and delivered group life insurance
policy (policy), not just a group term life insurance policy, to cover the
spouse and children of each person eligible to be insured under the policy,
provided that the amount of coverage for the spouse and child is prohibited
from exceeding the amount of the insurance for which the insured is
eligible to be insured. 
 
RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Article 3.51-4A, Insurance Code, as follows:

ARTICLE 3.51.-4A.  New title: EXTENSION OF GROUP LIFE INSURANCE TO SPOUSES
AND CHILDREN 

Sec. 1.  Authorizes the extension of insurance under any lawfully issued
and delivered group life insurance policy (policy), rather than any group
term life insurance policy, except for a policy issued and delivered to a
creditor or one that provided credit life insurance, to cover the spouse
and children (under age 21 or over age 21 if enrolled in school full-time
or are physically or mentally disabled and supervised by parents) of each
person eligible to be insured under the policy, provided that the amount of
coverage for the spouse and child is prohibited from exceeding the amount
of the insurance for which the insured is eligible to be insured, rather
than exceeding one-half of the amount of insurance on the life of the
insured, under the policy. 

Sec. 2.  Makes a conforming change.

Sec. 3.  Makes conforming changes.

Sec. 4.  Makes no change.

SECTION 2.  Makes application of this Act prospective for an insurance
policy delivered, issued for delivery, or renewed on or after January 1,
2000. 

SECTION 3.  Effective date: September 1, 1999.

SECTION 4.  Emergency clause.