78R4954 AJA-D

By:  Ellis                                                        S.B. No. 1620



A BILL TO BE ENTITLED

AN ACT

relating to payment periods for certain life insurance policies.              
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter A, Chapter 1101, Insurance Code, as 
effective June 1, 2003, is amended by adding Section 1101.014 to 
read as follows:
	Sec. 1101.014.  PAYMENT PERIOD FOR CERTAIN LIFE INSURANCE 
POLICIES.  (a)  This section applies to an insurer authorized to 
write life insurance in this state under Chapter 841, 882, 884, or 
982.
	(b)  This section 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.
	(c)  For a life insurance policy with an initial face amount 
of $15,000 or less on which the total amount of premiums paid under 
payment terms offered for the policy, minus cash dividends received 
under the policy, could exceed 150 percent of the policy's face 
value, the insurer shall also offer the applicant for the policy a 
payment period established by the commissioner under Subsection 
(d).
	(d)  The commissioner by rule shall establish periods for the 
payment of premiums on a policy described by Subsection (c) at the 
end of which the policy is paid up.
	SECTION 2.  The change in law made by this Act applies only 
to a life insurance policy offered for sale on or after January 1, 
2004.  A life insurance policy offered for sale before January 1, 
2004, is governed by the law in effect immediately before the 
effective date of this Act, and that law is continued in effect for 
that purpose.
	SECTION 3.  This Act takes effect September 1, 2003.