By: Elkins H.B. No. 3247

A BILL TO BE ENTITLED

AN ACT

relating to the board of directors of the Texas Mutual Insurance Company.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Amend Section 2054.052 to read as follows:

Sec. 2054.052. QUALIFICATIONS. (a) Each board member must be a resident of this state.

(b) An individual may not serve as a board member if the individual or the individual's spouse [, another individual related to the individual within the second degree by consanguinity or affinity, or another individual residing in the same household with the individual]:

(1) is registered or licensed under this code or is required to be registered or licensed under this code;

(2) is employed by or acts as an insurance [a] consultant to a person, or has a controlling financial interest in an organization, registered or licensed under this code or required to be registered or licensed under this code;

(3) [owns, controls, has a financial interest in, or participates in the management of an organization registered or licensed under this code or required to be registered or licensed under this code;

[(4)] receives a substantial tangible benefit from the company or the department; or

(4) [(5)] is an officer, employee, or consultant of an association in the field of insurance.

(c) Subsection (b) does not prohibit an individual from serving as a board member if the individual is only a policyholder or a consumer of insurance or insurance products.

[(d) An individual who is ineligible to serve on the board under Subsection (b) may not serve as a board member until the first anniversary of the date the condition that makes the individual ineligible ends.]

SECTION 2. Amend Section 2054.103(b), Insurance Code, to read as follows:

(b) The president must have proven successful experience as an executive at the general management level in [the] business [of insurance].

SECTION 3. Section 2054.059(b), Insurance Code, is amended to read as follows:

(b) A special meeting may be called by any two board members on five [two] days' notice.

SECTION 4. This Act takes effect September 1, 2011.