SRC-JBJ S.B. 984 76(R)   BILL ANALYSIS


Senate Research Center   S.B. 984
By: Madla
Economic Development
4/5/1999
As Filed


DIGEST 

Currently, an insurer must provide an insured person or applicant, at their
request, a written statement of the reasons for a cancellation or for
nonrenewal of an insurance policy.  However, the statements may be general
and may not provide enough information to the affected person.  S.B. 984
would require insurers to fully explain a decision adversely affecting an
applicant or policyholder. 

PURPOSE

As proposed, S.B. 984 requires an insurer's written denial to contain
certain specific information. 

RULEMAKING AUTHORITY

Rulemaking authority is granted to the commissioner of insurance in SECTION
1 (Article 21.49-2E(b), Chapter 21, Insurance Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 21, Insurance Code, by adding Article 21.49-2E,
as follows: 

Art. 21.49-2E.  REQUIREMENTS FOR WRITTEN STATEMENT OF REASON FOR
CANCELLATION, DECLINATION, OR NONRENEWAL.  Requires an insurer's written
statement that explains a cancellation, declination, or renewal of an
insurance policy required by Articles 21.49-2, 21.49-2A, 21.49-2B,
Insurance Code, to fully explain a decision which adversely affects an
applicant or policyholder by denying the applicant or policyholder coverage
or continued coverage, and to contain certain specific information
regarding the denial. Authorizes and directs the commissioner of insurance
to issue rules necessary to implement this article. 

SECTION 2.Effective date: September 1, 1999.
  Makes application of this Act prospective to January 1, 2000.

SECTION 3.Emergency clause.