C.S.H.B. 124 78(R)    BILL ANALYSIS


C.S.H.B. 124
By: Burnam
Insurance
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Fraud drives up premiums for all policyholders.  Because jewelry is easy
to dispose of and exchange for cash, insurance companies are reluctant to
write policies for cash value.  Therefore, such policies are difficult to
obtain and are expensive. C.S.H.B. 124 gives an insurer that provides
personal property insurance coverage the option to replace a jewelry item
with one of like kind and quality.  

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

C.S.H.B. 124 amends the Insurance Code to provide that an insurer who
provides personal property insurance coverage for jewelry will have the
option to elect either to pay the stated value or actual replacement of
the jewelry item with one of like kind and quality. 

The bill requires the Commissioner of Insurance (Commissioner) to adopt,
not later than December 31, 2003, any policy forms and endorsements
necessary to implement the Act. 

EFFECTIVE DATE

September 1, 2003.

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 124 modifies the original by clarifying that an insurer has the
option to replace a jewelry item with one of like kind and quality.