1-1     By:  Shapiro                                          S.B. No. 1196
 1-2           (In the Senate - Filed March 10, 1999; March 11, 1999, read
 1-3     first time and referred to Committee on Economic Development;
 1-4     April 9, 1999, reported favorably by the following vote:  Yeas 6,
 1-5     Nays 0; April 9, 1999, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to consent to the purchase or application for, and
 1-9     designation of owners or beneficiaries of, certain life insurance
1-10     policies.
1-11           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12           SECTION 1.  Chapter 113, Acts of the 53rd Legislature,
1-13     Regular Session, 1953 (Article 3.49-1, Vernon's Texas Insurance
1-14     Code), is amended to read as follows:
1-15           Sec. 1.  Any person of legal age may apply for insurance on
1-16     his life in any legal reserve or mutual assessment life insurance
1-17     company and in such application designate in writing any person,
1-18     persons, partnership, association, corporation or other legal
1-19     entity, or any combination thereof, as the beneficiary or
1-20     beneficiaries, or the absolute or partial owner or owners, or both
1-21     beneficiary and owner, of any policy or policies issued in
1-22     connection with such application; and with respect to any such
1-23     policy or policies any such beneficiary or owner so designated
1-24     shall at all times thereafter have an insurable interest in the
1-25     life of such person, except as provided in Section 4 of this Act [3
1-26     hereof].
1-27           Sec. 2.  Any person of legal age whose life is insured under
1-28     any existing or future policy of insurance by any legal reserve or
1-29     mutual assessment life insurance company may, in the manner and to
1-30     the extent permitted by the policy, designate in writing as the
1-31     beneficiary or beneficiaries thereof any person, persons,
1-32     partnership, association, corporation or other legal entity, or any
1-33     combination thereof, and in addition, in any manner and to any
1-34     extent not prohibited by the terms of the policy, may transfer or
1-35     assign in writing any such policy or any interest, benefit, right
1-36     or title therein to any person, persons, partnership, association,
1-37     corporation or other legal entity, or any combination thereof, and
1-38     with respect to any such policy any such beneficiary, transferee or
1-39     assignee shall at all times thereafter have an insurable interest
1-40     in the life of such person, except as provided in Section 4 of this
1-41     Act [3 hereof].
1-42           Sec. 3.  Any person of legal age may consent in writing to
1-43     the purchase of or the application for an individual or group
1-44     insurance policy or policies issued by any legal reserve or mutual
1-45     assessment life insurance company by a third party or parties and
1-46     in such written document consent to or designate any person,
1-47     persons, partnership, association, corporation or other legal
1-48     entity, or any combination thereof, as the absolute or partial
1-49     owner or owners or beneficiary, or any combination thereof, of any
1-50     policy or policies issued in connection with such consent or
1-51     designation; and with respect to any such policy or policies any
1-52     such owner or beneficiary shall at all times thereafter have an
1-53     insurable interest in the life of such person, except as provided
1-54     in Section 4 of this Act.
1-55           Sec. 4.  Notwithstanding the provisions thereof, no person,
1-56     persons, partnership, association, corporation or other legal
1-57     entity, or any combination thereof, directly or indirectly engaged
1-58     in the business of burying the dead shall have or obtain, directly
1-59     or indirectly, any insurable interest in the life of any person by
1-60     virtue of Sections 1, [or] 2, or 3 of this Act [hereof], or shall
1-61     have an insurable interest in the life of any person unless such
1-62     insurable interest be established under and by virtue of other
1-63     applicable statutory or common law.
1-64           Sec. 5[4].  The provisions of this Act are cumulative of
 2-1     existing law in Texas, statutory and otherwise, on the question of
 2-2     insurable interest.  This Act is enacted in specific recognition of
 2-3     the provisions of Article 21.23 of the Texas Insurance Code, 1951,
 2-4     that the interest of any beneficiary in a life insurance policy is
 2-5     forfeited if the beneficiary is the principal or an accomplice in
 2-6     bringing about the death of the insured.
 2-7           This Act shall be liberally construed to effectuate its
 2-8     purposes, and its provisions are not to be limited or restricted by
 2-9     previous declarations or holdings of the Courts of Texas defining
2-10     the term insurable interest.
2-11           SECTION 2.  This Act takes effect September 1, 1999, and
2-12     applies only to an insurance policy delivered, issued for delivery,
2-13     or renewed on or after January 1, 2000.  A policy delivered, issued
2-14     for delivery, or renewed before January 1, 2000, is governed by the
2-15     law as it existed immediately before the effective date of this
2-16     Act, and that law is continued in effect for that purpose.
2-17           SECTION 3.  The importance of this legislation and the
2-18     crowded condition of the calendars in both houses create an
2-19     emergency and an imperative public necessity that the
2-20     constitutional rule requiring bills to be read on three several
2-21     days in each house be suspended, and this rule is hereby suspended.
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