84R7852 MEW-F
 
  By: Frullo H.B. No. 2893
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the licensing of insurance agents and adjusters;
  providing a penalty.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Sections 4001.006(a) and (b), Insurance Code,
  are amended to read as follows:
         (a)  The department shall collect from each agent of an
  insurer writing insurance in this state under this code:
               (1)  a nonrefundable license application fee; and
               (2)  a nonrefundable appointment fee for each
  appointment of the agent by an insurer.
         (b)  The department shall deposit the fees described by
  Subsection (a), together with other license application fees,
  examination fees, and license renewal application fees, to the
  credit of the Texas Department of Insurance operating account.
         SECTION 2.  Section 4001.162, Insurance Code, is amended to
  read as follows:
         Sec. 4001.162.  RESTRICTION ON APPOINTMENT OF TEMPORARY
  LICENSE HOLDERS. (a) Except as provided by Subsection (b), an [An]
  agent, insurer, or health maintenance organization may not appoint
  more than 500 temporary license holders during a calendar year.
         (b)  The commissioner shall adopt reasonable rules setting
  standards for an agent, insurer, or health maintenance organization
  to appoint more than 500 temporary license holders during a
  calendar year. The standards must include consideration of the
  ability of an agent, insurer, or health maintenance organization to
  monitor appointed temporary agents.
         SECTION 3.  Section 4003.001, Insurance Code, is amended by
  amending Subsection (a) and adding Subsections (c) and (d) to read
  as follows:
         (a)  Unless a staggered renewal system is adopted under
  Section 4003.002, each [agent] license issued or renewed by the
  department under Chapter 981 or Subtitle A, B, or C and not
  suspended or revoked by the commissioner expires on:
               (1)  the second anniversary of the date the license is
  issued to or renewed by a person that is not an individual; or
               (2)  except as provided in Subsection (c):
                     (A)  for a license issued or renewed in an
  even-numbered year, the individual license holder's birthday each
  even-numbered year; or
                     (B)  for a license issued or renewed in an
  odd-numbered year, the individual license holder's birthday each
  odd-numbered year.
         (c)  If a person holds more than one license, all licenses
  issued to the person expire on the earliest expiration date of the
  licenses held. Thereafter, all licenses expire in accordance with
  Subsection (a).
         (d)  Notwithstanding Section 4003.002(b), the commissioner
  may not prorate the initial application fee for a license based on
  the expiration period of the license under Subsection (c).
         SECTION 4.  Section 4003.006, Insurance Code, is amended to
  read as follows:
         Sec. 4003.006.  CONTINUATION OF ORIGINAL LICENSE. The
  original license of a person who has applied for license renewal in
  compliance with Section 4003.004 [4003. 004] remains in effect from
  the date the renewal application is filed until the date:
               (1)  the department issues the renewal license; [or]
               (2)  the license is not renewed under Section 4004.055;
  or
               (3)  the commissioner issues an order revoking the
  license.
         SECTION 5.  Section 4003.008(b), Insurance Code, is amended
  to read as follows:
         (b)  The person must pay to the department a fee equal to the
  license application fee.
         SECTION 6.  Section 4004.051(a), Insurance Code, is amended
  to read as follows:
         (a)  Except as provided by Section 4004.052 or other law,
  each individual who holds a license issued by the department shall
  complete, as a condition of licensure, continuing education as
  provided by this chapter.
         SECTION 7.  Section 4004.053(a), Insurance Code, is amended
  to read as follows:
         (a)  An individual who holds a general life, accident, and
  health license, a life agent license, a life and health insurance
  counselor license, an adjuster license, a managing general agent
  license, a general property and casualty license, or a personal
  lines property and casualty license must complete 24 [15] hours of
  continuing education during the license period [annually].  If the
  individual holds more than one license for which continuing
  education is otherwise required, the individual is not required to
  complete more than 24 [15] continuing education hours for all
  licenses during the license period [annually].  An individual who
  is required under rules adopted under Chapter 4008 to hold a
  certificate to sell a designated product or product line may use
  continuing education programs administered under Section 4004.151
  to satisfy the annual continuing education requirements under this
  subsection.
         SECTION 8.  Subchapter B, Chapter 4004, Insurance Code, is
  amended by adding Section 4004.055 to read as follows:
         Sec. 4004.055.  CONSEQUENCES OF FAILURE TO COMPLETE
  CONTINUING EDUCATION REQUIREMENT. (a) The department may not
  renew a license issued under this title if the license holder fails
  to:
               (1)  complete an applicable continuing education
  requirement not later than the 90th day after the last day of the
  licensing period; or
               (2)  pay an applicable fine related to the failure to
  timely complete continuing education.
         (b)  The department may not issue a new license under this
  title to an individual who was previously licensed under this title
  if the individual fails to:
               (1)  provide evidence of completion of an applicable
  continuing education requirement for the expired, nonrenewed,
  canceled, or revoked license; or
               (2)  pay an applicable fine related to the failure to
  timely complete continuing education.
         (c)  Completion of continuing education after expiration of
  a license is not a defense in a disciplinary action under Section
  4005.101, Section 4005.109, or another provision of this code
  against an individual who failed to complete continuing education
  as required by this chapter.
         SECTION 9.  Section 4004.101(a), Insurance Code, is amended
  to read as follows:
         (a)  The department shall certify continuing education
  programs for agents and adjusters. The certification criteria must
  be designed to ensure that continuing education programs enhance
  the knowledge, understanding, and professional competence of the
  license holder.
         SECTION 10.  Subchapter C, Chapter 4004, Insurance Code, is
  amended by adding Section 4004.105 to read as follows:
         Sec. 4004.105.  ADJUSTER CONTINUING EDUCATION PROGRAM
  CONTENTS. A continuing education program for adjusters licensed
  under Chapter 4101 must include education relating to:
               (1)  Chapter 541;
               (2)  Chapter 547;
               (3)  Subchapter A, Chapter 542;
               (4)  Subchapter E, Chapter 17, Business & Commerce
  Code; and
               (5)  any other similar laws specified by the
  department.
         SECTION 11.  Section 4005.105(d), Insurance Code, is amended
  to read as follows:
         (d)  Subsections (b) and [Subsection] (c) do [does] not apply
  to an applicant whose license application was denied or revoked for
  failure by the applicant to:
               (1)  pass a required written examination; [or]
               (2)  complete continuing education or pay an applicable
  fine under Section 4004.055(a); or
               (3)  submit a properly completed license application.
         SECTION 12.  Section 4005.109, Insurance Code, is amended by
  amending Subsection (b) and adding Subsection (b-1) to read as
  follows:
         (b)  A violation for which a fine may be assessed under this
  section includes a failure to:
               (1)  obtain the total number of continuing education
  hours before the expiration [renewal] date of a license;
               (2)  timely report a change of address to the
  department; or
               (3)  notify the department of an administrative action
  against the agent by a financial or insurance regulator of another
  state or of the federal government.
         (b-1)  The aggregate amount of fines assessed under
  Subsection (b)(1) may not exceed $500 for a licensing period.
         SECTION 13.  Subchapter B, Chapter 4056, Insurance Code, is
  amended by adding Section 4056.059 to read as follows:
         Sec. 4056.059.  TRANSITION TO RESIDENT AGENT LICENSE. (a)
  This section applies only to an individual who is a nonresident
  agent licensed under Section 4056.052 and who has moved from the
  other state that licensed the individual to this state.
         (b)  A nonresident agent may apply to the department for a
  comparable license for residents of this state. An application
  must include:
               (1)  a notification of the agent's change of address and
  contact information;
               (2)  a clearance letter from the state authority of the
  state that issued the agent's prior resident license demonstrating
  the agent's good standing with that authority; and
               (3)  fingerprint forms in the format prescribed by the
  department, which may be electronic.
         (c)  If a nonresident agent submits a satisfactory
  application in accordance with Subsection (b), the department shall
  issue a comparable resident agent license to the agent and revoke
  the agent's nonresident agent license.
         SECTION 14.  Sections 4101.057(a), (b), and (d), Insurance
  Code, are amended to read as follows:
         (a)  Before issuing or renewing a license under this chapter,
  the department shall set and collect a nonrefundable license
  application fee in an amount not to exceed $50.
         (b)  An applicant for a renewal license must remit the fee
  required by Subsection (a) before the expiration of the [biennially
  after the issuance of the original] license being renewed. If the
  applicant's license has been expired for not more than 90 days, an
  applicant for a renewal license must remit, in addition to the fee
  assessed under Subsection (a), a fee equal to one-half of the
  original application [license] fee.
         (d)  Before issuing a duplicate license requested by an
  adjuster, the department shall set and collect a duplicate license
  application fee.
         SECTION 15.  Section 4101.059(a), Insurance Code, is amended
  to read as follows:
         (a)  To renew a license under this chapter, a licensed
  adjuster must participate in a continuing education program under
  Chapter 4004 [relating to consumer protection]. [The program must
  include education relating to consumer protection laws, including:
               [(1)  Chapter 541;
               [(2)  Chapter 547;
               [(3)  Subchapter A, Chapter 542;
               [(4)     Subchapter E, Chapter 17, Business & Commerce
  Code; and
               [(5)     any other similar laws specified by the
  department.]
         SECTION 16.  Section 4101.061, Insurance Code, is amended to
  read as follows:
         Sec. 4101.061.  EXPIRATION; RENEWAL. Expiration and
  renewal of a license issued under this chapter are governed by
  Sections 4003.001 and 4004.055, rules adopted by the commissioner,
  and [or] any applicable provision of this code or another insurance
  law of this state.
         SECTION 17.  Section 4102.062, Insurance Code, is amended to
  read as follows:
         Sec. 4102.062.  EXPIRATION. A license issued under this
  chapter expires as provided by Chapter 4003 [on the second
  anniversary of the date of issuance] unless suspended or revoked by
  the commissioner.
         SECTION 18.  Section 4102.064, Insurance Code, is amended to
  read as follows:
         Sec. 4102.064.  RENEWAL OF UNEXPIRED LICENSE. (a) A license
  holder may renew a license that has not expired and has not been
  suspended or revoked by filing with the department a properly
  completed renewal application, in the form prescribed by the
  commissioner, that demonstrates continued compliance with the
  license requirements imposed under this chapter or adopted by rule
  by the commissioner.  The completed renewal application must be
  accompanied by:
               (1)  a renewal application fee in the amount determined
  by the commissioner under Section 4102.066(b); and
               (2)  evidence of compliance with the continuing
  education requirements imposed under Section 4102.109.
         (b)  A license holder must submit the completed renewal
  application, evidence of compliance with the continuing education
  requirements, and the renewal application fee to the commissioner
  not later than the 30th day before the second anniversary date of
  the license.
         (c)  On the filing of a completed renewal application, a
  renewal application fee, and, if applicable, evidence of compliance
  with the continuing education requirements, the original license
  continues in force until:
               (1)  the department issues the renewal license; [or]
               (2)  the license is not renewed under Section 4004.055;
  or
               (3)  the commissioner issues an order revoking the
  license.
         SECTION 19.  Section 4102.065, Insurance Code, is amended to
  read as follows:
         Sec. 4102.065.  RENEWAL OF EXPIRED LICENSE. (a) A person
  whose license has been expired for 90 days or less may renew the
  license by:
               (1)  submitting to the department:
                     (A)  a completed renewal application in the form
  prescribed by the commissioner; and
                     (B)  evidence of compliance with the continuing
  education requirements and eligibility for renewal under Section
  4004.055; and
               (2)  paying to the department the required renewal
  application fee and an additional fee that is equal to one-half of
  the renewal application fee for the license.
         (b)  Except as provided by Section 4004.055, a [A] person
  whose license has been expired for more than 90 days but less than
  one year may not renew the license but is entitled to a new license
  without taking the applicable examination if the person submits to
  the department:
               (1)  a new application;
               (2)  evidence of compliance with the continuing
  education requirements;
               (3)  the license application fee; and
               (4)  an additional fee equal to one-half of the license
  application fee.
         (c)  A person whose license has been expired for one year or
  more may not renew the license. The person may obtain a new license
  by:
               (1)  submitting to reexamination, if examination is
  required for original issuance of the license;
               (2) [, and by] complying with the requirements and
  procedures for obtaining an original license; and
               (3)  if applicable, submitting evidence of completion
  of any outstanding continuing education requirement related to the
  expired license.
         (d)  The department may renew without reexamination an
  expired license of a person who was licensed in this state, moved to
  another state, and is currently licensed and has been in continual
  practice in the other state up to and including the date of the
  application.  The person must pay to the department a fee that is
  equal to the license application fee.
         SECTION 20.  Section 4102.109(a), Insurance Code, is amended
  to read as follows:
         (a)  Each license holder must annually complete at least 24
  [15] hours of continuing education during the license period
  [courses].  The commissioner by rule shall prescribe the
  requirements for continuing education courses under this section.
         SECTION 21.  (a)  Sections 4001.006, 4003.001, 4003.008,
  4101.057, 4101.061, 4102.062, 4102.064, and 4102.065, Insurance
  Code, as amended by this Act, apply only to a license issued or
  renewed on or after January 1, 2016. A license issued or renewed
  before January 1, 2016, is governed by the law as it existed
  immediately before the effective date of this Act, and that law is
  continued in effect for that purpose.
         (b)  On January 1, 2016, each license held on that date under
  Chapter 981, Insurance Code, and Subtitles A, B, and C, Title 13,
  Insurance Code, expires as follows:
               (1)  each license issued to a person that is not an
  individual expires on the expiration date of the license with the
  longest remaining term held by that person on January 1, 2016;
               (2)  each license issued to an individual expires, or
  may be extended to expire, on the individual's birthday in the year
  after the expiration date of the license with the longest remaining
  term held by that person on January 1, 2016; and
               (3)  after a license expires as described by
  Subdivision (1) or (2) of this subsection, the license renews and
  expires as provided by Section 4003.001, Insurance Code, as amended
  by this Act.
         (c)  To the extent that the term of an existing license is
  extended under this section, the department may not charge an
  additional fee or require a renewal application before the renewal
  date established under this section.
         (d)  Except as provided by Subsection (e) of this section,
  the change in law made by the amendments listed in Subsection (a) of
  this section and the provisions of this section do not change the
  continuing education requirements for a license issued or renewed
  on or after January 1, 2016. Except as otherwise provided by
  provisions of this Act other than this section and the amendments
  listed in Subsection (a) of this section, the continuing education
  requirements for a license issued or renewed before January 1,
  2016, are governed by the law as it existed immediately before the
  effective date of this Act, and that law is continued in effect for
  that purpose.
         (e)  A licensee may not be required to complete additional
  continuing education hours for a license during any period the
  license was extended under this section beyond its original
  expiration date.
         SECTION 22.  Sections 4004.053 and 4102.109, Insurance Code,
  as amended by this Act, apply only to continuing education
  requirements for a license issued or renewed on or after the
  effective date of this Act. Continuing education requirements for
  a license issued or renewed before the effective date of this Act
  are governed by the law as it existed immediately before the
  effective date of this Act, and that law is continued in effect for
  that purpose.
         SECTION 23.  Section 4004.055, Insurance Code, as added by
  this Act, and Sections 4004.051, 4005.105, and 4005.109, Insurance
  Code, as amended by this Act, apply only to completion of continuing
  education requirements for a license issued or renewed on or after
  November 1, 2015. Completion of continuing education requirements
  for a license issued or renewed before November 1, 2015, is governed
  by the law as it existed immediately before the effective date of
  this Act, and that law is continued in effect for that purpose.
         SECTION 24.  Section 4056.059, Insurance Code, as added by
  this Act, applies only to a nonresident agent who relocates to this
  state on or after the effective date of this Act. An agent who
  relocates to this state before the effective date of this Act is
  governed by the law as it existed immediately before that date, and
  that law is continued in effect for that purpose.
         SECTION 25.  This Act takes effect September 1, 2015.