HBA-CBW H.B. 2830 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2830 By: Smithee Insurance 4/22/2001 Introduced BACKGROUND AND PURPOSE The Texas Department of Insurance (department) has been unsuccessful in obtaining convictions against individuals involved in the sale of unauthorized insurance from locations in Texas to persons who are residents of other states. There is a need to clarify the statutes with regard to this unauthorized insurance activity to eliminate any possible safe harbors for individuals who are engaged in such activities. House Bill 2830 clarifies law to enforce unauthorized insurance activity in Texas. 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 2830 amends the Insurance Code to provide that a person commits a third degree felony offense if the person engages in the business of insurance without a valid certificate of authority, license, or specific authorization or exemption, or after the person's certificate of authority, license, or authorization has been suspended or revoked. The bill removes the provision pertaining to a defense to prosecution regarding the conduct that constitutes the business of insurance. The bill authorizes the commissioner of insurance, if the commissioner has reason to believe a person has violated or is threatening to violate the provisions or adopted rules to request the Travis County district attorney to proceed with criminal prosecution. The bill modifies that acts that constitute the business of insurance in this state to include issuing or delivering an insurance contract, rather than issuing or delivering an insurance contract to a resident of this state or a person authorized to do business in this state. The bill applies to all persons, rather than residents of Texas only. EFFECTIVE DATE September 1, 2001.