1-1                                   AN ACT
 1-2     relating to stabilization of long-term care insurance premium
 1-3     rates.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Article 3.70-12, Insurance Code, is amended by
 1-6     adding Section 5A to read as follows:
 1-7           Sec. 5A.  RATE STABILIZATION. (a)  The commissioner shall
 1-8     adopt rules to stabilize long-term care insurance premium rates by:
 1-9                 (1)  ensuring that:
1-10                       (A)  initial rates for long-term care insurance
1-11     policy forms are adequate; and
1-12                       (B)  any rate schedule increases for long-term
1-13     care insurance policies made after issuance of the policies are
1-14     justified, adequate, and reasonable in relation to benefits
1-15     provided to policy or certificate holders;
1-16                 (2)  requiring any appropriate policy terms;
1-17                 (3)  imposing penalties on insurers or other entities
1-18     subject to this article that violate a rule adopted under this
1-19     section; and
1-20                 (4)  protecting policy and certificate holders affected
1-21     by a rate schedule increase.
1-22           (b)  Except as provided by this subsection, the commissioner
1-23     shall adopt rules under this section that are consistent with
1-24     nationally recognized models relating to the stabilization of
 2-1     long-term care insurance premium rates that existed on January 1,
 2-2     2001.  The commissioner may adopt rules consistent with any of
 2-3     those models as they are amended after January 1, 2001.  The
 2-4     commissioner shall adopt rules under this subsection that:
 2-5                 (1)  to the extent possible, contribute to the
 2-6     uniformity of state laws; and
 2-7                 (2)  protect consumers.
 2-8           (c)  In adopting rules under this section, the commissioner
 2-9     may exempt long-term care insurance policies from the requirements
2-10     of Sections 4(a) and (c) of this article.
2-11           SECTION 2. (a)  This Act takes effect September 1, 2001.
2-12           (b)  The commissioner of insurance shall adopt rules under
2-13     Section 5A, Article 3.70-12, Insurance Code, as added by this Act,
2-14     not later than January 1, 2002.
         _______________________________     _______________________________
             President of the Senate              Speaker of the House
               I certify that H.B. No. 2482 was passed by the House on May
         5, 2001, by a non-record vote.
                                             _______________________________
                                                 Chief Clerk of the House
               I certify that H.B. No. 2482 was passed by the Senate on May
         22, 2001, by the following vote:  Yeas 30, Nays 0, 1 present, not
         voting.
                                             _______________________________
                                                 Secretary of the Senate
         APPROVED:  __________________________
                              Date
                    __________________________
                            Governor