HBA-CMT H.B. 2415 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 2415
By: Giddings
Insurance
4/1/2001
Introduced



BACKGROUND AND PURPOSE 

There have been instances in the past where some companies in the life
insurance industry have charged different policy premiums based on a
person's race.  A settlement last year penalized American General for its
former practice of race-based premiums.  It is believed that other
companies working in the state of Texas still have some of these race-based
policy rates on the books.  House Bill 2415 requires the commissioner of
insurance to investigate the extent to which premiums charged for and
benefits provided under life insurance policies issued in Texas are
inequitable as a result of past race-based practices by life insurers. 

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 2415 requires the commissioner of insurance (commissioner) to
investigate the extent to which premiums charged for and benefits provided
under a life insurance policy (policy) issued in this state and in force on
the effective date of this Act are inequitable as a result of race-based
practices by life insurers in effect at the time the policies were first
issued.  The bill provides that if the commissioner determines that
premiums charged for or benefits provided under a policy are inequitable as
a result of race-based practices by an insurer, the commissioner after
notice and a hearing is authorized to order an insurer who issued or has
acquired the policy to take any action the commissioner determines is
appropriate to remedy the inequity, regardless of whether the insurer has
ceased to engage in those practices.   

The bill authorizes the owner of a policy issued before the effective date
of the bill to request relief from the commissioner under the provisions of
this bill. 

EFFECTIVE DATE

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001.