By Burnam H.B. No. 1092
76R2593 PB-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the application of the flexible rating system to
1-3 insurance written by county mutual insurance companies, Lloyd's
1-4 associations, and reciprocal or interinsurance exchanges.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Article 5.101, Insurance Code, is amended by
1-7 adding Section 6 to read as follows:
1-8 Sec. 6. APPLICATION OF FLEX-RATING TO COUNTY MUTUAL
1-9 INSURANCE COMPANIES, LLOYD'S ASSOCIATIONS, AND RECIPROCAL AND
1-10 INTERINSURANCE EXCHANGES. (a) This article applies to:
1-11 (1) a county mutual insurance company;
1-12 (2) an underwriter at a Lloyd's; and
1-13 (3) a reciprocal or interinsurance exchange.
1-14 (b) Except as provided by Subsection (c) of this section,
1-15 each county mutual insurance company, underwriter at a Lloyd's, and
1-16 reciprocal or interinsurance exchange is subject to the rate and
1-17 rating manual filing requirements of Section 3 of this article.
1-18 (c) The commissioner shall establish separate benchmark
1-19 rates for county mutual insurance companies. In promulgating
1-20 benchmark rates applicable to county mutual insurance companies,
1-21 the commissioner shall consider the factors described by Section
1-22 3(c) of this article based only on the experience of county mutual
1-23 insurance companies. A county mutual insurance company may use
1-24 multiple rating tiers or rating programs within that company, but
2-1 must make a separate filing for each rating tier or rating program.
2-2 SECTION 2. Article 17.22, Insurance Code, is amended to
2-3 read as follows:
2-4 Art. 17.22. APPLICATION OF [EXEMPTION FROM] INSURANCE LAWS.
2-5 (a) County mutual insurance companies shall be exempt from the
2-6 operation of all insurance laws of this state, except such laws as
2-7 are made applicable by their specific terms or as in this Chapter
2-8 specifically provided.
2-9 (b) In addition to any laws made applicable under Subsection
2-10 (a) [such other Articles as may be made to apply by other Articles]
2-11 of this article [Code], county mutual insurance companies are
2-12 [shall be] subject to:
2-13 (1) Subdivision 7 of Article 1.10 of this code [Code];
2-14 and
2-15 (2) Articles 1.15, 1.15A, 1.16, 1.24, 2.04, 2.05,
2-16 2.08, 2.10, 4.10, 5.12, 5.37, 5.38, 5.39, 5.40, 5.49, 5.101, 21.21,
2-17 and 21.49 of this code [Code].
2-18 [(b) The flexible rating program created under Subchapter M,
2-19 Chapter 5, of this code does not apply to county mutual insurance
2-20 companies.]
2-21 SECTION 3. Article 18.23(b), Insurance Code, is amended to
2-22 read as follows:
2-23 (b) In addition to any laws made applicable under Subsection
2-24 (a) of this article [such Articles as may be made to apply by other
2-25 Articles of this Chapter], underwriters at a Lloyds' are [shall not
2-26 be exempt from and shall be] subject to Articles 1.15A, 2.20, 5.35,
2-27 5.38, 5.39, 5.40, 5.49, 5.101, 21.21, and 21.49-8 of this code
3-1 [Code].
3-2 SECTION 4. Article 19.12(b), Insurance Code, is amended to
3-3 read as follows:
3-4 (b) In addition to any laws made applicable under Subsection
3-5 (a) [such Articles as may be made to apply by other Articles] of
3-6 this article [Code], reciprocal or inter-insurance exchanges are
3-7 [shall not be exempt from and shall be] subject to:
3-8 (1) Section 5, Article 1.10, of this code [Code]; and
3-9 (2) Articles 1.15, 1.15A, 1.16, 2.20, 5.35, 5.37,
3-10 5.38, 5.39, 5.40, 5.101, 6.12, 8.07, 21.21, and 21.49-8 of this
3-11 code [Code].
3-12 SECTION 5. This Act applies only to rates for an insurance
3-13 policy that is delivered, issued for delivery, or renewed on or
3-14 after January 1, 2000. Rates for a policy that is delivered,
3-15 issued for delivery, or renewed before January 1, 2000, are
3-16 governed by the law as it existed immediately before the effective
3-17 date of this Act, and that law is continued in effect for that
3-18 purpose.
3-19 SECTION 6. This Act takes effect September 1, 1999.
3-20 SECTION 7. The importance of this legislation and the
3-21 crowded condition of the calendars in both houses create an
3-22 emergency and an imperative public necessity that the
3-23 constitutional rule requiring bills to be read on three several
3-24 days in each house be suspended, and this rule is hereby suspended.