1-1     By:  Eiland, Seaman (Senate Sponsor - Sibley)         H.B. No. 2102
 1-2           (In the Senate - Received from the House May 4, 2001;
 1-3     May 7, 2001, read first time and referred to Committee on Business
 1-4     and Commerce; May 11, 2001, reported favorably, as amended, by the
 1-5     following vote:  Yeas 7, Nays 0; May 11, 2001, sent to printer.)
 1-6     COMMITTEE AMENDMENT NO. 1
 1-7     Amend HB 2102, Engrossed Version, as follows:
 1-8           (1)  In SECTION 4 of the bill, Article 21.81, strike
 1-9     Subsection (j) beginning on page 4, line 55 through page 5, line
1-10     13; and
1-11           (2)  Strike SECTIONS 6 through 13 of the bill and renumber
1-12     subsequent SECTIONS accordingly.
1-13                            A BILL TO BE ENTITLED
1-14                                   AN ACT
1-15     relating to the determination of premium rates for certain lines of
1-16     insurance.
1-17           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-18           SECTION 1. Sections 3(b), (c), (d), and (o), Article 5.101,
1-19     Insurance Code, are amended to read as follows:
1-20           (b)  The commissioner shall promulgate by rule a benchmark
1-21     rate for each line subject to this article after notice and hearing
1-22     [under Chapter 2001, Government Code (the Administrative Procedure
1-23     Act)].  The commissioner shall set the benchmark rate to produce a
1-24     range that:
1-25                 (1)  promotes stability in that line; and
1-26                 (2)  produces rates that are just, reasonable, adequate
1-27     and not excessive for the risks to which they apply, and not
1-28     confiscatory.
1-29           (c)  In promulgating the benchmark rate, the commissioner may
1-30     give due consideration to:
1-31                 (1)  past and prospective loss experience within the
1-32     state and outside the state if the state data are not credible;
1-33                 (2)  the peculiar hazards and experience of individual
1-34     risks, past and prospective, within and outside the state;
1-35                 (3)  a reasonable margin for profit;
1-36                 (4)  expenses of operation of all insurers, excluding
1-37     only those [which may not include disallowed] expenses that are
1-38     disallowed under Subsection (o) of this section;
1-39                 (5)  the extent and nature of competition in that
1-40     market;
1-41                 (6)  the availability or lack of availability in that
1-42     market;
1-43                 (7)  the level and range of rates and rate changes
1-44     among insurers;
1-45                 (8)  investment and underwriting experience of
1-46     insurers;
1-47                 (9)  reinsurance availability;
1-48                 (10)  consumer complaints;
1-49                 (11)  extent of denials and restrictions of coverage;
1-50                 (12)  the volume of cancellations and nonrenewals; and
1-51                 (13)  any other factor considered appropriate by the
1-52     commissioner.
1-53           (d)  Each flexibility band is based on a benchmark rate
1-54     promulgated by rule by the commissioner.  The commissioner shall
1-55     conduct hearings annually to determine the benchmark rates by line
1-56     [on or before September 1 of each year].  Before each hearing
1-57     conducted under this subsection, the commissioner shall request
1-58     recommendations from insurers, trade associations, the public
1-59     insurance counsel, and any other interested person or entity
1-60     regarding changes to the benchmark rates.  The recommendations must
1-61     include any supporting actuarial analyses.  Notice of each hearing
1-62     proposing changes to the benchmark rates must be published in the
1-63     Texas Register. The commissioner shall receive public comment for
 2-1     at least 30 days after the notice is published.  The determination
 2-2     of the rate shall not include disallowed expenses under Subsection
 2-3     (o) of this section.  An insurer, the public insurance counsel, and
 2-4     any other interested person may present views, analyses, and
 2-5     arguments in response to the commissioner's request for
 2-6     recommendations, either before or [testimony] at the hearing, and
 2-7     may file information for consideration by the commissioner.  The
 2-8     public insurance counsel and any insurer, trade association, or
 2-9     other interested person or entity that has submitted proposed
2-10     changes or actuarial analyses may ask questions of any person
2-11     testifying at [An advisory organization which collects ratemaking
2-12     data shall not be a party to] the hearing.  A trade association
2-13     that does not collect historical data and that does not provide
2-14     statistical plans, prospective loss costs, or supplementary rating
2-15     information to its members may, on behalf of its members that are
2-16     small or medium-sized insurers, as defined by the commissioner,
2-17     present rate making data and make recommendations to the
2-18     commissioner before or at the hearing.  There is no immunity from
2-19     antitrust liability for a trade association that presents rate
2-20     making data or makes recommendations to the commissioner [at the
2-21     hearing].  The definition of "small and medium-sized insurers"
2-22     shall be a limitation upon the scope of the presentation to be made
2-23     by a trade association, but may not limit the participation of a
2-24     trade association because its membership includes other sized
2-25     insurers.  After the hearing, the commissioner shall adopt a rule
2-26     promulgating the benchmark rates. An insurer shall use that
2-27     benchmark rate and the flexibility band to develop rates used for
2-28     the line for the year following the setting of the benchmark rate.
2-29           (o)  For the purposes of this section, "disallowed expenses"
2-30     include:
2-31                 (1)  administrative expenses, not including acquisition
2-32     expenses, not including acquisition, loss control and safety
2-33     engineering expenses, that exceed 110 percent of the industry
2-34     median for those expenses;
2-35                 (2)  lobbying expenses;
2-36                 (3)  advertising expenses, other than advertising that
2-37     is directly related to the services or products provided by the
2-38     insurer, advertising designed and directed at loss prevention, or
2-39     advertising the promotion of organizations exempt from federal
2-40     taxation under Section 501(c)(3) of the Internal Revenue Code;
2-41                 (4)  amounts paid by an insurer as damages in a suit
2-42     against the insurer for bad faith or as fines or penalties for
2-43     violation of law;
2-44                 (5)  contributions to organizations engaged in
2-45     legislative advocacy;
2-46                 (6)  fees and penalties imposed on the insurer for
2-47     civil or criminal violations of law;
2-48                 (7)  contributions to social, religious, political, or
2-49     fraternal organizations;
2-50                 (8)  fees and assessments paid to advisory
2-51     organizations; and
2-52                 (9)  any unreasonably incurred expenses, as determined
2-53     by the commissioner after notice and  hearing in a proceeding
2-54     separate from the benchmark hearing under this article.
2-55           SECTION 2. Section 5, Article 5.101, Insurance Code, is
2-56     amended to read as follows:
2-57           Sec. 5.  APPLICABILITY OF CERTAIN GOVERNMENT CODE
2-58     REQUIREMENTS [ADMINISTRATIVE PROCEDURE ACT APPLICABLE; BENCHMARK
2-59     RATE HEARINGS]. (a)  Subject to Chapter 40 of this code, Chapter
2-60     2001, Government Code [(the Administrative Procedure Act)], applies
2-61     to all rate hearings conducted under this article, other than a
2-62     benchmark rate hearing conducted under Section 3(d) of this article
2-63     [subject to Article 1.33B of this code and Subsections (b)-(d) of
2-64     this section].
2-65           (b)  Subchapter A, Chapter 2006, Government Code, does not
2-66     apply to a benchmark rate hearing conducted under Section 3(d) of
2-67     this article. [In a hearing on benchmark rates conducted under this
2-68     article, discovery directed to any party to the proceeding
2-69     concerning that party's premium, loss, expense, profit, or rate of
 3-1     return experience or its operations is prohibited, except to the
 3-2     extent that the party presents evidence, relies on, or provides to
 3-3     another party its own individual insurer data in the benchmark rate
 3-4     hearing.  This subsection does not deny or restrict any party's
 3-5     right to produce or rely on relevant information concerning an
 3-6     individual insurer as evidence in a benchmark rate hearing.]
 3-7           [(c)  As part of a benchmark rate hearing, any party may
 3-8     present evidence regarding, and the administrative law judge shall
 3-9     make proposed findings concerning, any adjustments or amendments
3-10     that should be made to the statistical reporting rules and
3-11     statistical plans to aid in presenting a case at future benchmark
3-12     rate hearings.]
3-13           [(d)  If the record indicates evidence under Subsection (c)
3-14     of this section, the commissioner may initiate a proceeding under
3-15     Article 5.96 of this code to determine and make adjustments and
3-16     amendments to the rules and statistical plans as necessary to
3-17     further aid in determining whether rates and rating systems in use
3-18     under this article comply with the regulatory standards imposed
3-19     under this article.  The commissioner shall consider the evidence
3-20     taken at the benchmark rate hearings under Subsection (c) of this
3-21     section, and shall address that evidence in any order or action
3-22     taken as a result of the proceeding.]
3-23           SECTION 3. Article 5.101, Insurance Code, is amended by
3-24     adding Section 6 to read as follows:
3-25           Sec. 6.  APPEAL. A person aggrieved by an order of the
3-26     commissioner setting benchmark rates may,  not later than the 30th
3-27     day after the date on which the commissioner issued the order,
3-28     appeal the order.   An appeal of  an  order of the commissioner
3-29     setting benchmark rates under this article must be made in
3-30     accordance with Subchapter D, Chapter 36, of this code.
3-31           SECTION 4. Section 5, Article 21.81, Insurance Code, is
3-32     amended to read as follows:
3-33           Sec. 5.  RATES FOR INSURANCE; HEARING. (a)  [At least
3-34     annually, the commissioner shall conduct a hearing for the purpose
3-35     of determining appropriate rates to be charged for insurance
3-36     provided through the association.  The association may appear as a
3-37     matter of right, shall be admitted as a party to present testimony
3-38     at the hearing, and may file information for consideration by the
3-39     commissioner.]  The commissioner shall determine and prescribe
3-40     appropriate rates to be charged for insurance provided through the
3-41     association [rates] that are just, reasonable, adequate, not
3-42     excessive, not confiscatory, and not unfairly discriminatory for
3-43     the risks to which they apply.  Rates shall be set in an amount
3-44     sufficient to carry all claims to maturity and to meet the expenses
3-45     incurred in the writing and servicing of the business.  In making a
3-46     determination, the commissioner shall consider the reports of
3-47     aggregated premiums earned and losses and expenses incurred in the
3-48     writing of motor vehicle insurance through the plan collected under
3-49     the statistical plan provided for by Subsection (b) of this
3-50     section.
3-51           (b)  The commissioner shall promulgate reasonable rules and
3-52     statistical plans to be used by each insurer in the recording and
3-53     reporting of its premium, loss, and expense experience which must
3-54     be reported separately for business assigned to it and other data
3-55     required by the commissioner.
3-56           (c)  The association shall file annually with the department
3-57     for approval by the commissioner rates to be charged for insurance
3-58     provided through the association.  The association may not make
3-59     such a filing more than once in any 12-month period.  Subchapter B,
3-60     Chapter 40, of this code does not apply to:
3-61                 (1)  a filing made under this subsection;
3-62                 (2)  Subsections (d)-(h) of this section; or
3-63                 (3)  a department action with respect to such a filing.
3-64           (d)  Before approving, disapproving, or modifying a filing
3-65     made under Subsection (c) of this section, the commissioner shall
3-66     provide all interested persons a reasonable opportunity to:
3-67                 (1)  review the filing;
3-68                 (2)  obtain copies of the filing on payment of any
3-69     legally required copying cost; and
 4-1                 (3)  submit to the commissioner written comments,
 4-2     analyses, or information related to the filing.
 4-3           (e)  Not later than the 45th day after the date on which the
 4-4     department receives the filing required under Subsection (c) of
 4-5     this section, the commissioner shall schedule a hearing at which
 4-6     interested persons may present written or oral comments relating to
 4-7     the filing.  A hearing under this subsection is not a contested
 4-8     case hearing under Chapter 2001, Government Code.  The association,
 4-9     the public insurance counsel, and any other interested person or
4-10     entity that has submitted proposed changes or actuarial analyses
4-11     may ask questions of any person testifying at the hearing.
4-12           (f)  The department shall file with the Texas Register notice
4-13     that a filing has been made under Subsection (c) of this section
4-14     not later than the seventh day after the date the filing is
4-15     received by the department. The notice must include information
4-16     relating to:
4-17                 (1)  the availability of the filing for public
4-18     inspection at the department during regular business hours and the
4-19     procedures for obtaining copies of the filing;
4-20                 (2)  procedures for making written comments related to
4-21     the filing; and
4-22                 (3)  the time, place, and date of the hearing scheduled
4-23     under Subsection (e) of this section.
4-24           (g)  After the conclusion of the hearing, the commissioner
4-25     shall approve, disapprove, or modify the filing in writing.  If the
4-26     commissioner disapproves a filing, the commissioner shall state in
4-27     writing the reasons for the disapproval and the criteria to be met
4-28     by the association to obtain approval.  The association may file
4-29     with the commissioner, not later than the 10th day after the date
4-30     on which the association receives the commissioner's written
4-31     disapproval, an amended filing to comply with the commissioner's
4-32     comments.
4-33           (h)  Before approving or disapproving an amended filing, the
4-34     commissioner shall provide all interested persons a reasonable
4-35     opportunity to review the amended filing, obtain copies of the
4-36     amended filing on payment of any legally required copying cost, and
4-37     submit to the commissioner written comments or information related
4-38     to the amended filing in the manner provided by Subsection (d) of
4-39     this section, and may hold a hearing not later than the 20th day
4-40     after the date on which the department receives the amended filing
4-41     in the manner provided by Subsection (e) of this section.  Not
4-42     later than the 10th day after the date on which the hearing on the
4-43     amended filing is concluded, the commissioner shall approve or
4-44     disapprove the amended filing.  Not later than the 30th day after
4-45     the date on which the amended filing is received by the department,
4-46     the commissioner shall disapprove the amended filing or it is
4-47     considered approved.  The requirements adopted under Subsections
4-48     (f) and (g) of this section apply to a hearing conducted under this
4-49     subsection.
4-50           (i)  A person aggrieved by a decision of the commissioner
4-51     under this section may, not later than the 30th day after the date
4-52     of the commissioner's decision, appeal the decision. An appeal of a
4-53     commissioner's decision under this section must be made in
4-54     accordance with Subchapter D, Chapter 36, of this code.
4-55           (j)  Notwithstanding Subsections (a)-(h) of this section or
4-56     any other provision of this article, an applicant is eligible for
4-57     insurance through the association if the applicant and the
4-58     servicing agent certify that the applicant is unable to find
4-59     coverage at a rate that is within the benchmark flexibility band
4-60     adopted under Article 5.101 of this code and that the applicant is
4-61     a good driver.  The applicant shall be charged a rate for coverage
4-62     that does not exceed a rate that is greater than the midway point
4-63     between 115 percent of the benchmark rate adopted under Article
4-64     5.101 of this code and the rate adopted under this section.  The
4-65     commissioner may adopt rules as necessary to implement this
4-66     subsection.  In this subsection, "good driver" means an individual
4-67     who:
4-68                 (1)  is over the age of:
4-69                       (A)  if male, 25 years of age; and
 5-1                       (B)  if female, 21 years of age;
 5-2                 (2)  has been licensed for at least three years to
 5-3     drive the type of motor vehicle to be insured;
 5-4                 (3)  during the previous three years, has not:
 5-5                       (A)  been at fault in a motor vehicle accident
 5-6     that resulted in bodily injury, death, or property damage;
 5-7                       (B)  been convicted of a violation of a traffic
 5-8     safety regulation that involved a moving vehicle; or
 5-9                       (C)  been convicted of an offense under Section
5-10     49.04, Penal Code, or Section 106.041, Alcoholic Beverage Code;
5-11                 (4)  has never made a fraudulent insurance claim; and
5-12                 (5)  does not drive a sports car or other
5-13     high-performance vehicle.
5-14           SECTION 5.  Subchapter B, Chapter 40, Insurance Code, is
5-15     amended by adding Section 40.061 to read as follows:  
5-16           Sec. 40.061.  FLEXIBLE RATING PROGRAM.  Notwithstanding
5-17     Sections 40.051-40.060, hearings for benchmark rates for all lines
5-18     of insurance subject to Article 5.101 of this code are conducted as
5-19     provided by Section 3(d) of that article.
5-20           SECTION 6. The heading to Article 5.131, Insurance Code, is
5-21     amended to read as follows:
5-22           Art. 5.131.  [TEMPORARY] RATE ROLLBACK FOR CERTAIN LINES OF
5-23     INSURANCE.
5-24           SECTION 7. Section 1, Article 5.131, Insurance Code, is
5-25     amended to read as follows:
5-26           Sec. 1.  FINDINGS. The legislature finds that:
5-27                 (1)  the cost of litigation against insureds and their
5-28     insurers, the possibility of large and unjust judgments, and the
5-29     uncertainty created by a litigious environment within this state
5-30     have been significant factors in the high cost of certain lines of
5-31     insurance;
5-32                 (2)  legislation enacted by regular sessions of the
5-33     75th, 76th, and 77th [73rd and 74th] legislatures, and legislation
5-34     passed by or pending in [which may be aided by legislation under
5-35     consideration by] the [104th] Congress of the United States, is
5-36     intended to meaningfully reform the civil justice system of this
5-37     state and this nation and will result in reductions in the cost of
5-38     litigation and in the size of judgments;
5-39                 (3)  certain decisions by the Supreme Court of Texas
5-40     and federal appellate courts during the years 1995-2001 have
5-41     resulted in reductions in the size of certain judgments;
5-42                 (4)  it can be reasonably anticipated that there will
5-43     be additional legislation and court decisions in the future that
5-44     will result in reductions in the cost of litigation and in the size
5-45     of judgments;
5-46                 (5)  while the monetary effect of the legislative
5-47     changes can be actuarially determined within a reasonable degree of
5-48     certainty, insurers will delay implementation of rate reductions
5-49     until they have data evidencing actual loss experience;
5-50                 (6) [(4)]  the delay described by Subdivision (5) [(3)]
5-51     of this section will result in a windfall for the insurers
5-52     benefited by the changes [legislation] described by Subdivisions
5-53     [Subdivision] (2), (3), and (4) of this section, and this benefit
5-54     should be passed on to their insureds; and
5-55                 (7) [(5)]  legislative action in the public interest
5-56     and within the police power of the state is required to eliminate
5-57     unnecessary delays to pass these benefits on to the insured public
5-58     of this state.
5-59           SECTION 8. Section 2(c), Article 5.131, Insurance Code, is
5-60     amended to read as follows:
5-61           (c)  This article applies only to policies or coverages in
5-62     the following lines or sublines that are issued, issued for
5-63     delivery, or renewed on and after January 1, 2002 [1996]:
5-64                 (1)  professional liability insurance for a physician,
5-65     other health care provider, or hospital;
5-66                 (2)  commercial liability insurance for damages arising
5-67     out of the manufacture, design, importation, distribution,
5-68     packaging, labeling, lease, or sale of a product or for completed
5-69     operations coverage;
 6-1                 (3)  private passenger automobile liability insurance
 6-2     for bodily injury;
 6-3                 (4)  commercial automobile liability insurance for
 6-4     bodily injury;
 6-5                 (5)  private umbrella and excess liability insurance;
 6-6                 (6)  the liability portion of commercial multi-peril
 6-7     insurance;
 6-8                 (7)  the liability portion of homeowner's, farm and
 6-9     ranch owner's, and renter's insurance;
6-10                 (8)  the employer's liability portion of workers'
6-11     compensation insurance; and
6-12                 (9)  other commercial liability insurance, including
6-13     the following lines and sublines:
6-14                       (A)  premises medical;
6-15                       (B)  fire legal liability;
6-16                       (C)  personal advertising injury;
6-17                       (D)  contractual liability;
6-18                       (E)  liability for all premises;
6-19                       (F)  pollution liability;
6-20                       (G)  owners and contractors protective liability;
6-21                       (H)  railroad protective liability;
6-22                       (I)  liquor liability;
6-23                       (J)  farm liability;
6-24                       (K)  commercial umbrella and excess liability;
6-25                       (L)  professional liability other than insurance
6-26     described by Subdivision (1) of this subsection; and
6-27                       (M)  garage liability.
6-28           SECTION 9. Sections 3(a), (b), (d), and (e), Article 5.131,
6-29     Insurance Code, are amended to read as follows:
6-30           (a)  Notwithstanding Chapter 40 [Article 1.33B] of this code,
6-31     on or before September 1 of each year, the commissioner shall hold
6-32     a rulemaking hearing under Chapter 2001, Government Code, to
6-33     determine the percentage of equitable across-the-board reductions
6-34     in insurance rates required of insurers writing the lines and
6-35     sublines of liability coverage described by Section 2(c) of this
6-36     article.
6-37           (b)  Not later than October 1, 2001 [1995], the commissioner
6-38     shall issue rules mandating the appropriate rate reductions to
6-39     rates for the lines and sublines of liability coverage described by
6-40     Section 2(c) of this article and developed without consideration of
6-41     the effect of the changes [legislation] described by Section 1 of
6-42     this article.
6-43           (d)  The rate reductions adopted under this section are
6-44     applicable to each policy or coverage issued, issued for delivery,
6-45     or renewed on and after January 1, 2002 [1996], and to each policy
6-46     or coverage issued, issued for delivery, or renewed on and after
6-47     the 90th day after the date of each subsequent rule adopted under
6-48     Subsection (a)  of this section.
6-49           (e)  Notwithstanding Subsection (d) of this section, if, on
6-50     January 1, 2002 [1996], the commissioner has not issued an order
6-51     establishing rate reductions for a line or subline under this
6-52     section, the following reductions, as measured from the base rates
6-53     in effect on April 1, 2001 [1995], apply to each insurer for each
6-54     affected policy or coverage issued, issued for delivery, or renewed
6-55     on and after January 1, 2002 [1996]:
6-56     LINE or SUBLINE                                PERCENTAGE REDUCTION
6-57     (1)  professional liability insurance for
6-58          physician, other health care provider,
6-59          or hospital:                                       30%        
6-60     (2)  commercial liability insurance for
6-61          damages arising out of the manufacture,
6-62          design, importation, distribution,
6-63          packaging, labeling, lease, or sale
6-64          of a product or for
6-65          completed operations coverage:                     25%        
6-66     (3)  private passenger automobile liability
6-67          insurance for bodily injury:                       15%        
6-68     (4)  commercial automobile liability
6-69          insurance for bodily injury:                       20%        
 7-1     (5)  private umbrella and excess liability
 7-2          insurance:                                         20%        
 7-3     (6)  the liability portion of commercial
 7-4          multi-peril insurance:                             10%        
 7-5     (7)  the liability portion of homeowner's,
 7-6          farm and ranch  owner's,
 7-7          and renter's insurance:                             5%        
 7-8     (8)  the employer's liability portion
 7-9          of workers' compensation  
7-10          insurance:                                         10%        
7-11     (9)  all lines and sublines of other
7-12          commercial liability insurance:                    15%        
7-13           SECTION 10. Section 4(a), Article 5.131, Insurance Code, is
7-14     amended to read as follows:
7-15           (a)  Except as provided by Subsection (b) of this section, a
7-16     rate filed as to a line or subline of insurance coverage affected
7-17     by this article on and after January 1, 2002 [1996], and a rate
7-18     filed on and after the 90th day following the effective date of a
7-19     subsequent rule adopted under Section 3(a) of this article, shall
7-20     reflect the rate reduction imposed by Section 3 of this article.
7-21     The commissioner shall disapprove a rate, subject to the procedures
7-22     established by Section 7, Article 5.13-2, of this code if the
7-23     commissioner finds that the filed rate does not reflect that
7-24     reduction.
7-25           SECTION 11. Section 6, Article 5.131, Insurance Code, is
7-26     amended to read as follows:
7-27           Sec. 6.  CONTINUATION [DURATION] OF REDUCTION.  After the
7-28     conclusion of each regular biennial legislative session, beginning
7-29     with the 78th legislative session, the commissioner shall conduct a
7-30     review of state and federal legislation and court decisions
7-31     analogous to that conducted under Section 3 of this article to
7-32     determine if that legislation and those court decisions can
7-33     reasonably be anticipated to reduce  the cost of litigation or the
7-34     amount of damages.  If the commissioner finds that those reductions
7-35     are likely, the commissioner shall order an additional rate
7-36     rollback, as provided by this article, to begin on January 1 of
7-37     each even-numbered year. [Unless the commissioner grants relief
7-38     under Section 4 or 5 of this article, each rate resulting from the
7-39     reduction required under Section 3 of this article remains in
7-40     effect until January 1, 2001.]
7-41           SECTION 12. Section 8, Article 5.131, Insurance Code, is
7-42     amended to read as follows:
7-43           Sec. 8.  HEARINGS AND ORDERS. Notwithstanding Chapter 40
7-44     [Article 1.33B] of this code, a rulemaking hearing under this
7-45     article shall be held before the commissioner or the commissioner's
7-46     designee.  [Article 1.09-5 of this code does not apply to hearings
7-47     under this article.]  The rulemaking procedures established by this
7-48     section do not apply to any other rate promulgation proceeding.
7-49           SECTION 13. Section 9, Article 5.131, Insurance Code, is
7-50     amended to read as follows:
7-51           Sec. 9.  PENDING RATE MATTERS. A rate filed pursuant to a
7-52     commissioner's order issued before May 1, 2001 [1995], is not
7-53     subject to the rate reductions required by this article before
7-54     January 1, 2002 [1996].
7-55           SECTION 14. Section 37.052(d), Insurance Code, is amended to
7-56     read as follows:
7-57           (d)  The department may appear as a matter of right as a
7-58     party, present evidence, or question a witness in a proceeding
7-59     before the commissioner or the designated hearings officer in which
7-60     insurance rates are set under this code.  [This subsection expires
7-61     September 1, 2001.]
7-62           SECTION 15. This Act applies only to premium rates for an
7-63     insurance policy delivered, issued for delivery, or renewed on or
7-64     after January 1, 2002.  Rates for a policy delivered, issued for
7-65     delivery, or renewed before January 1, 2002, are governed by the
7-66     law as it existed immediately before the effective date of this
7-67     Act, and that law is continued in effect for that purpose.
7-68           SECTION 16. This Act takes effect September 1, 2001.
 8-1                                  * * * * *