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A BILL TO BE ENTITLED
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AN ACT
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relating to capital stock and surplus requirements for certain |
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insurance companies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 822.054(a), Insurance Code, is amended |
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to read as follows: |
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(a) An insurance company must have capital stock in an |
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amount of at least $2.5 [$1] million and surplus in an amount of at |
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least $2.5 [$1] million. |
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SECTION 2. Sections 822.212(a) and (b), Insurance Code, are |
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amended to read as follows: |
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(a) Notwithstanding Section 822.203, to engage in the kinds |
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of insurance business for which an insurance company organized |
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under this chapter holds a certificate of authority in this state, |
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an insurance company organized under this chapter that on September |
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1, 2009 [1991], had less than the minimum amount of capital and |
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surplus required for a newly incorporated company under Section |
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822.054 must: |
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(1) not later than December 31, 2018 [2000], have |
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increased the amount of its capital by at least 90 percent of the |
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difference between the amount of minimum capital required for a |
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newly incorporated company under Section 822.054 and the amount of |
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the company's capital on December 31, 2009 [1991]; and |
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(2) not later than December 31, 2019 [2001], have at |
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least the minimum amount of capital required under Section 822.054 |
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for a newly incorporated company. |
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(b) An insurance company that on September 1, 2009 [1991], |
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had less than the minimum amount of capital and surplus required for |
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a newly incorporated company under Section 822.054 shall |
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immediately increase the amount of its capital and surplus to an |
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amount equal to the required amount of capital and surplus under |
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Section 822.054 if there is: |
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(1) a change in the control of at least 50 percent of |
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the voting securities of the insurance company; |
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(2) a change in the control of at least 50 percent of |
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the voting securities of a holding company controlling the |
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insurance company; or |
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(3) a change in control of at least 50 percent by any |
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other method of control if the insurance company or holding company |
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is not controlled by voting securities. |
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SECTION 3. This Act takes effect September 1, 2009. |