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A BILL TO BE ENTITLED
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AN ACT
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relating to a study concerning the collection and use of certain |
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information by certain insurers. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. DEFINITION. In this Act, "department" means the |
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Texas Department of Insurance. |
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SECTION 2. DEPARTMENT STUDY CONCERNING DATA MINING AND |
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PATTERN RECOGNITION. The department shall conduct a study of: |
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(1) technologies such as statistical techniques, |
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devices, or models that may be used by or on behalf of an insurer |
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that writes personal automobile or residential property insurance |
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to establish new classifications or to change methods of |
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classification for rating, tiering, or underwriting; and |
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(2) the manner in which the insurer may use the |
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relationships derived from the technologies described by |
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Subdivision (1) in: |
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(A) predicting differences in expected losses of |
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insureds or applicants for coverage; |
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(B) underwriting and creating and defining risk |
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classifications or changing a method of classification; |
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(C) setting or determining rates and premiums; or |
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(D) using classifications or a change in a method |
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of classification to deny coverage, limit coverage, or refuse to |
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renew or cancel coverage for individual insureds. |
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SECTION 3. REPORT TO LEGISLATURE. The department shall |
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include a report of the results of the study conducted under this |
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Act in the biennial report to the 82nd Legislature made under |
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Section 32.022, Insurance Code. The report must describe the impact |
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that the use of the relationships derived from technologies |
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described by Section 2 of this Act has on insurance, insureds, and |
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applicants for insurance in this state, and may include |
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recommendations for proposed legislation appropriate to regulate |
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or mitigate the use of those technologies. |
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SECTION 4. EFFECTIVE DATE. This Act takes effect |
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immediately if it receives a vote of two-thirds of all the members |
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elected to each house, as provided by Section 39, Article III, Texas |
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Constitution. If this Act does not receive the vote necessary for |
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immediate effect, this Act takes effect September 1, 2009. |