By:  Janek                                                        S.B. No. 1564


A BILL TO BE ENTITLED

AN ACT

relating to the repeal of the requirement for a surety bond or other 
proof of financial responsibility for licensure of surplus lines 
insurance agents.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 981.203, Insurance Code, is amended to 
read as follows:  
	Sec. 981.203.  QUALIFICATIONS FOR SURPLUS LINES LICENSE.  
(a)  The department may issue a surplus lines license to an 
applicant who the department determines complies with Subsection 
(b) and is:
		(1)  an individual who:                                                       
			(A)  has passed an examination under Article 
21.01-1 and department rules; and
			(B)  holds a current license as:                                             
				(i)  a general property and casualty agent 
authorized under Article 21.14; or
				(ii)  a managing general agent; or                                          
		(2)  a corporation, limited liability company, or 
partnership that:         
			(A)  has at least one officer or director or at 
least one active partner who has passed the required surplus lines 
license examination;
			(B)  holds a current license as:                                             
				(i)  a general property and casualty agent 
authorized under Article 21.14; or
				(ii)  a managing general agent; and                                         
			(C)  conducts insurance activities under this 
chapter only through an individual licensed under this section.
	(b)  The agent must:                                                           
		(1)  pay an application fee as determined by the 
department; and     
		(2)  submit a properly completed license application[; 
and 
		[(3)  provide proof of financial responsibility under 
Section 981.206].
	SECTION 2.  Section 981.206, Insurance Code, is repealed.                      
	SECTION 3.  This Act takes effect January 1, 2006.