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78R6590 AJA-D
By: Thompson H.B. No. 1243
A BILL TO BE ENTITLED
AN ACT
relating to compensation of insurance agents by small employer
health benefit plan carriers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Article 26.72, Insurance Code, is amended by
amending Subsection (c) and adding Subsection (e) to read as
follows:
(c) Subsection (b) of this article does not apply to an
arrangement that provides compensation to an agent on the basis of
percentage of premium, provided that:
(1) the percentage may not vary because of health
status or claim experience; and
(2) the small employer carrier does not:
(A) exclude any additional premium charged to the
small employer because of health status or claims experience from
the premium amount to which the percentage is applied; or
(B) apply a smaller percentage to any additional
premium charged to the small employer because of health status or
claims experience than is applied to other premiums charged to the
small employer.
(e) A small employer carrier may not use an agent
compensation schedule that provides compensation in a specific
dollar amount for each individual covered during a specified period
or for each group of individuals covered during a specified period.
SECTION 2. The change in law made by this Act applies only
to a compensation agreement entered into by a small employer
carrier and an agent on or after the effective date of this Act. A
compensation agreement entered into before the effective date of
this Act is governed by the law in effect immediately before that
date, and that law is continued in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2003.