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By: Averitt S.B. No. 1668
A BILL TO BE ENTITLED
AN ACT
relating to the sale of insurance by financial institutions
employed by a trustee.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 113.053(f), Property Code, is amended to
read as follows:
(f) A national banking association, a state-chartered
corporation, including a state-chartered bank or trust company, a
state or federal savings and loan association that has the right to
exercise trust powers and that is serving as trustee, or such an
institution that is serving as custodian with respect to an
individual retirement account, as defined by Section 408, Internal
Revenue Service Code, an employee benefit plan as defined by
Section 3(3), Employee Retirement Income Security Act of 1974 (29
U.S.C. Section 1002(3)), regardless of whether the custodial
account is, or would otherwise be, considered a trust for purposes
of this subtitle may:
(1) employ an affiliate or division within a financial
institution to provide brokerage, insurance, investment,
administrative, custodial or other account services for the trust
or custodial account for services., provided, however, nothing in
this section shall allow an affiliate or division to engage in the
sale or business of insurance if not otherwise permitted to do so;
This section does not alter or negate applicable licensing and
regulatory requirements administered by a functional regulatory
agency of this state; and
(2) receive compensation, directly or indirectly, on
account of the services performed by the affiliate or division
within the financial institution, whether in the form of shared
commissions, fees, or otherwise, provided that any amount charged
by the affiliate or division for the services is disclosed and does
not exceed the customary or prevailing amount that is charged by the
affiliate or division, or a comparable entity, for comparable
services rendered to a person other than the trust.
SECTION 2. This Act takes effect September 1, 2003.