78R5527 AKH-D

By:  Giddings                                                     H.B. No. 2812



A BILL TO BE ENTITLED

AN ACT

relating to unclaimed benefits under certain life insurance 
policies; interim study.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Chapter 1101, Insurance Code, as effective June 
1, 2003, is amended by adding Subchapter H to read as follows:
	SUBCHAPTER H.  UNCLAIMED BENEFITS UNDER CERTAIN POLICIES                
	Sec. 1101.351.  APPLICABILITY.  (a)  This subchapter applies 
to each insurer authorized to write life insurance in this state 
operating under Chapter 841, 881, 882, 884, 885, 886, 887, 888, or 
982 and an insurer exempt under Section 887.102.
	(b)  This subchapter applies to any individual or group life 
insurance policy, other than a term life insurance policy, issued 
in this state, including an industrial insurance policy offered 
under Chapter 1151.
	Sec. 1101.352.  DUE DILIGENCE STANDARDS.  The commissioner 
shall adopt rules as necessary to define minimum standards of due 
diligence that an insurer must exercise relating to the payment of 
unclaimed benefits payable on the death of an insured who is covered 
under more than one life insurance policy issued by the insurer.
	SECTION 2.  (a)  The commissioner of insurance shall conduct 
a study of the marketplace in the state for life insurance issued 
with a small face amount and report the commissioner's findings to 
the legislature on or before January 1, 2005.
	(b)  In conducting the study, the commissioner of insurance 
shall evaluate the effect in the marketplace of Subchapter H, 
Chapter 1101, Insurance Code, as added by this Act, as that 
subchapter relates to small face amount policies, including the 
availability of small face amount policies in the marketplace.
	(c)  The commissioner of insurance may follow up on the 
findings relating to unclaimed benefits made by the Small Face 
Amount Life Insurance Advisory Committee appointed by the 
commissioner under Chapter 541, Acts of the 77th Legislature, 
Regular Session, 2001, as the commissioner determines appropriate.
	(d)  The commissioner of insurance shall appoint an advisory 
committee to assist in conducting the study required by this 
section and to obtain comments from interested parties. The 
committee shall include members who represent:
		(1)  life insurance agents;                                                   
		(2)  life insurers, including stipulated premium 
insurance companies;       
		(3)  the office of public insurance counsel;                                  
		(4)  consumers; and                                                           
		(5)  any other group the commissioner determines could 
contribute to the study.
	(e)  The advisory committee appointed under Subsection (d) 
of this section is abolished and this section expires September 1, 
2005.
	SECTION 3.  Not later than January 1, 2004, the commissioner 
of insurance shall adopt rules as required by Section 1101.352, 
Insurance Code, as added by this Act.
	SECTION 4.  This Act takes effect September 1, 2003.