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


Senate Research CenterC.S.S.B. 1658
77R9548 PB-FBy: Sibley
Business & Commerce
4/11/2001
Committee Report (Substituted)


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.
C.S.S.B. 1658 allows the department to maintain the confidentiality of
these documents. 

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 38A, Insurance Code, by adding Section 38.003,
as follows: 

Sec. 38.003.  REQUEST FOR DOCUMENTS UNDER DEPARTMENT INVESTIGATION.  (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 who receives a request from the department under
Subsection (b) to respond to the request with the production of requested
documents not later than the 10th business day after the date the request
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) Prohibits documentary material produced pursuant to an inquiry under
this section, unless otherwise ordered by a court for good cause shown,
from being produced for inspection or copying by, or 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 under which the documentary
material is made available for inspection and copying by the person who
produced the material or any authorized representative of that person.   

(e) Authorizes the department to use the documentary material or copies of
the material as the department determines necessary in the discharge of the
department's duties, including presentation before any court.  Prohibits
any material that contains trade secrets from being 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.

SUMMARY OF COMMITTEE CHANGES

SECTION 1.  Amends As Filed S.B. 1658 by conforming text to legislative
drafting standards.  Makes technical changes to clarify proposed text. 

SECTION 2.  Conforms proposed text to legislative drafting standards.