By Ramsay H.B. No. 2871
77R7546 AJA-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to rate rollback for certain lines of insurance.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 2(b), Article 5.131, Insurance Code, is
1-5 amended to read as follows:
1-6 (b) County [It is the intent of the legislature that all
1-7 insurers, including county] mutual insurers, joint underwriting
1-8 associations, and other insurers [others] whose rates are not
1-9 regulated shall[,] pass through the savings that accrue from the
1-10 legislation described by Section 1 of this article to their
1-11 policyholders on a prospective basis. To monitor compliance with
1-12 this legislative directive, the commissioner shall obtain and
1-13 examine data from each insurer described by this subsection as
1-14 necessary to ensure that the insurer is passing through savings to
1-15 the insurer's policyholders in compliance with this section. The
1-16 commissioner may require information in rate filings, special data
1-17 calls, informational hearings, and any other means consistent with
1-18 other provisions of this code applicable to the affected insurers.
1-19 Information provided under this subsection is privileged and
1-20 confidential to the same extent as the information is privileged
1-21 and confidential under this code or other laws for other insurers
1-22 licensed and writing the same line of insurance in this state. The
1-23 information remains privileged and confidential unless and until
1-24 introduced into evidence at an administrative hearing or in a court
2-1 of competent jurisdiction. Sections 3 and 4 of this article
2-2 [subchapter] do not apply to the [nonrate regulated] insurers
2-3 described [covered] by this subsection. Notwithstanding the
2-4 nonapplicability of those sections to those insurers, if the
2-5 commissioner determines on or before January 1, 2003, that an
2-6 insurer described by this subsection has failed to pass through
2-7 savings to that insurer's policyholders in compliance with this
2-8 subsection, the commissioner shall require the insurer to provide
2-9 rate refunds or reductions to the insurer's policyholders on a
2-10 prospective basis in an amount and manner determined by the
2-11 commissioner by rule.
2-12 SECTION 2. Section 6, Article 5.131, Insurance Code, is
2-13 amended to read as follows:
2-14 Sec. 6. DURATION OF REDUCTION. Unless the commissioner
2-15 grants relief under Section 4 or 5 of this article, each rate
2-16 resulting from the reduction required under Section 3 of this
2-17 article remains in effect until January 1, 2003 [2001].
2-18 SECTION 3. (a) Not later than September 30, 2001, the
2-19 commissioner of insurance by rule shall adopt the insurance rates
2-20 that resulted from the reduction required under Section 3, Article
2-21 5.131, Insurance Code, and that were in effect immediately before
2-22 January 1, 2001.
2-23 (b) The rates adopted under this section shall apply only to
2-24 an insurance policy delivered, issued for delivery, or renewed on
2-25 or after October 1, 2001.
2-26 (c) Section 6, Article 5.131, Insurance Code, applies to the
2-27 duration of the rates adopted under this section.
3-1 SECTION 4. This Act takes effect immediately if it receives
3-2 a vote of two-thirds of all the members elected to each house, as
3-3 provided by Section 39, Article III, Texas Constitution. If this
3-4 Act does not receive the vote necessary for immediate effect, this
3-5 Act takes effect September 1, 2001.