HBA-DMH, EDN H.B. 338 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 338 By: Averitt Insurance 3/2/2001 Introduced BACKGROUND AND PURPOSE Insurance fraud drives up the cost of property and casualty insurance rates. An insurance industry study by the National Insurance Crime Bureau found that 10 percent or more of property and casualty insurance claims are fraudulent, costing Americans approximately $30 billion each year or $200 to $300 in higher insurance premiums for the average household. House Bill 338 authorizes insurance companies to use specified information to prevent fraudulent claim activity. 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. ANALYSIS House Bill 338 amends the Insurance Code to authorize a person to collect, compile, furnish to, or exchange with any other person information to the extent the person considers the information reasonably necessary to detect or prevent criminal activity, fraud, material misrepresentation, or material nondisclosures in connection with filing an insurance claim or making a claim against any individual or any business, governmental, or other entity if indemnification by a liability insurance policy of the individual or entity is contemplated. The bill provides that a person who collects, compiles, furnishes to, or exchanges information with another person is not liable in a civil action or subject to criminal prosecution because of that action, except if the person acts with malice or with the intent to defraud. EFFECTIVE DATE September 1, 2001.