79R2723 DLF-F

By:  Averitt                                                      S.B. No. 398



A BILL TO BE ENTITLED

AN ACT

relating to rates and rating plans for automobile insurance.                  
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 13, Article 5.13-2, Insurance Code, is 
amended by amending Subsection (f) and adding Subsection (f-1) to 
read as follows:
	 (f) A county mutual insurance company that issues personal 
automobile insurance policies only at nonstandard rates, as 
determined before all applicable discounts are applied to the rates 
and after any policy fees are applied to the rates, is subject to 
filing requirements as determined by the commissioner by rule if 
the insurer and the insurer's affiliated companies or group have a 
market share of less than 3.5 percent.  In setting rates, an 
insurance company subject to this subsection must comply with the 
rating standards established by this article.  Not later than the 
first day on which any change in the rates becomes effective, the 
company shall for informational purposes file the rates and any 
additional information required by the department.  The 
commissioner by rule shall determine the information required to be 
provided in the filing under this subsection.  The commissioner may 
inspect the books and records of the company at any time to ensure 
compliance with the rating standards.  An insurance company 
described by this subsection is subject to Article 5.144 of this 
code.  A county mutual insurance company not described by this 
section is subject to Article 21.81 of this code and is required to 
comply with the filing requirements of this article and any other 
provision of this code applicable to a county mutual insurance 
company.
	(f-1) For a county mutual insurance company described by 
Subsection (f) of this section, each personal automobile insurance 
program of the company that is subject to a separate reinsurance 
agreement and each local chapter or district is considered an 
insurer for purposes of this article and Articles 1.02 and 5.171 of 
this code.
	SECTION 2.  Articles 5.01-1 and 5.01-3, Insurance Code, are 
repealed.        
	SECTION 3.  This Act applies only to the rate for an 
insurance policy that is delivered, issued for delivery, or renewed 
on or after January 1, 2006. The rate for an insurance policy that 
is delivered, issued for delivery, or renewed before January 1, 
2006, is governed by the law as it existed immediately before the 
effective date of this Act, and that law is continued in effect for 
this purpose.
	SECTION 4.  This Act takes effect September 1, 2005.