1-1     By:  Kitchen, Thompson (Senate Sponsor - Zaffirini)   H.B. No. 2482
 1-2           (In the Senate - Received from the House May 7, 2001;
 1-3     May 7, 2001, read first time and referred to Committee on Business
 1-4     and Commerce; May 10, 2001, reported favorably by the following
 1-5     vote:  Yeas 6, Nays 0; May 10, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to stabilization of long-term care insurance premium
 1-9     rates.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1. Article 3.70-12, Insurance Code, is amended by
1-12     adding Section 5A to read as follows:
1-13           Sec. 5A.  RATE STABILIZATION. (a)  The commissioner shall
1-14     adopt rules to stabilize long-term care insurance premium rates by:
1-15                 (1)  ensuring that:
1-16                       (A)  initial rates for long-term care insurance
1-17     policy forms are adequate; and
1-18                       (B)  any rate schedule increases for long-term
1-19     care insurance policies made after issuance of the policies are
1-20     justified, adequate, and reasonable in relation to benefits
1-21     provided to policy or certificate holders;
1-22                 (2)  requiring any appropriate policy terms;
1-23                 (3)  imposing penalties on insurers or other entities
1-24     subject to this article that violate a rule adopted under this
1-25     section; and
1-26                 (4)  protecting policy and certificate holders affected
1-27     by a rate schedule increase.
1-28           (b)  Except as provided by this subsection, the commissioner
1-29     shall adopt rules under this section that are consistent with
1-30     nationally recognized models relating to the stabilization of
1-31     long-term care insurance premium rates that existed on January 1,
1-32     2001.  The commissioner may adopt rules consistent with any of
1-33     those models as they are amended after January 1, 2001.  The
1-34     commissioner shall adopt rules under this subsection that:
1-35                 (1)  to the extent possible, contribute to the
1-36     uniformity of state laws; and
1-37                 (2)  protect consumers.
1-38           (c)  In adopting rules under this section, the commissioner
1-39     may exempt long-term care insurance policies from the requirements
1-40     of Sections 4(a) and (c) of this article.
1-41           SECTION 2. (a)  This Act takes effect September 1, 2001.
1-42           (b)  The commissioner of insurance shall adopt rules under
1-43     Section 5A, Article 3.70-12, Insurance Code, as added by this Act,
1-44     not later than January 1, 2002.
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