SRC-CTC S.B. 1658 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 1658
By: Sibley
Business & Commerce
4/9/2001
As Filed


DIGEST AND PURPOSE 

Currently, documents obtained by the Texas Department of Insurance
(department) during the course of an investigation of an insurer, agent, or
other regulated entity may be considered open record material.  If such
documents are indeed open record, the entity being investigated or others
could obtain copies of the documents and thwart the investigation.  As
proposed, S.B. 1658 allows the department to maintain the confidentiality
of documents during the investigation and until it is completed. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 38, Insurance Code, by adding Section 38.003, as
follows: 

Sec. 38.003.  REQUEST OF DOCUMENTS PURSUANT TO AN INVESTIGATION BY THE
DEPARTMENT.  (a) Defines "authorization."   

(b) Authorizes the Department of Insurance (department) to request relevant
documents as part of an investigation from an insurance company, agent, or
holder of an authorization relating to certain matters.   

(c) Requires a person receiving an inquiry under Subsection (b) to respond
to the production of requested documents not later than the 10th business
day after the date the inquiry is received unless additional time is
requested and approved by the department.  Requires the department to grant
a reasonable extension if the documentary evidence requested is voluminous
in nature or other extenuating circumstances warrant such an extension.   

(d) Requires no documentary material produced pursuant to an inquiry under
this section, unless otherwise ordered by a court for good cause shown, to
be produced for inspection or copying by, or its contents to be disclosed
to any person other than the authorized employee of the department without
the consent of the person who produced the material.  Requires the
department to prescribe reasonable terms and conditions allowing the
documentary  material to be available for inspection and copying by the
person who produced the material or any duly authorized representative of
that person.  Authorizes the department to use the documentary material or
copies of it as it determines necessary in the discharge of the
department's duties, including presentation before any court.  Requires any
material which contains trade secrets to not be presented except with the
approval of the court in which the action is pending after adequate notice
to the person furnishing the material. 

SECTION 2.  Effective date: September 1, 2001.
   Makes application of this Act prospective.