1-1     By:  Lindsay                                           S.B. No. 530
 1-2           (In the Senate - Filed February 16, 1999; February 17, 1999,
 1-3     read first time and referred to Committee on Economic Development;
 1-4     April 6, 1999, reported favorably by the following vote:  Yeas 4,
 1-5     Nays 0; April 6, 1999, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the premium tax on certain life, health, and accident
 1-9     insurance policies.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Subsection (c), Section 2, Article 4.11,
1-12     Insurance Code, is amended to read as follows:
1-13           (c)  "Gross premiums" are the total gross amount of all
1-14     premiums, membership fees, assessments, dues, and any other
1-15     considerations for such insurance received during the taxable year
1-16     on each and every kind of such insurance policy or contract
1-17     covering persons located in the State of Texas and arising from the
1-18     types of insurance specified in Section 1 of this article, but
1-19     deducting returned premiums, any dividends applied to purchase
1-20     paid-up additions to insurance or to shorten the endowment or
1-21     premium payment period, and excluding those premiums received from
1-22     insurance carriers for reinsurance and there shall be no deduction
1-23     for premiums paid for reinsurance.  For purposes of this article, a
1-24     stop-loss or excess loss insurance policy issued to a health
1-25     maintenance organization, as defined under the Texas Health
1-26     Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
1-27     Code), shall be considered reinsurance.  Such gross premiums shall
1-28     not include premiums received from the Treasury of the State of
1-29     Texas or from the Treasury of the United States for insurance
1-30     contracted for by the state or federal government for the purpose
1-31     of providing welfare benefits to designated welfare recipients or
1-32     for insurance contracted for by the state or federal government in
1-33     accordance with or in furtherance of the provisions of Title 2,
1-34     Human Resources Code, or the Federal Social Security Act.  The
1-35     gross premiums receipts so reported shall not include the amount of
1-36     premiums paid on group health, accident, and life policies in which
1-37     the group covered by the policy consists of a single nonprofit
1-38     trust established to provide coverage primarily for [municipal or
1-39     county] employees of:
1-40                 (1)  a municipality, county, or hospital district in
1-41     this state; or
1-42                 (2)  a county or municipal hospital, without regard to
1-43     whether the employees are employees of the county or municipality
1-44     or another entity operating the hospital on behalf of the county or
1-45     municipality.
1-46           SECTION 2.  (a)  This Act takes effect January 1, 2000.
1-47           (b)  The change in law made by this Act applies only to a
1-48     premium tax imposed under Article 4.11, Insurance Code, as amended
1-49     by this Act, beginning January 1, 2000.  A tax imposed under that
1-50     article before January 1, 2000, is governed by the law that existed
1-51     in the tax year in which that tax was imposed, and that law is
1-52     continued in effect for that purpose.
1-53           SECTION 3.  The importance of this legislation and the
1-54     crowded condition of the calendars in both houses create an
1-55     emergency and an imperative public necessity that the
1-56     constitutional rule requiring bills to be read on three several
1-57     days in each house be suspended, and this rule is hereby suspended.
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