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A BILL TO BE ENTITLED
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AN ACT
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relating to requirements regarding the withdrawal by certain |
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insurers from the market for certain lines of insurance. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 827.003, Insurance Code, is amended to |
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read as follows: |
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Sec. 827.003. WITHDRAWAL PLAN REQUIRED. (a) An insurer |
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shall file with the commissioner a plan for orderly withdrawal if |
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the insurer proposes to: |
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(1) reduce the insurer's total annual premium volume |
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by 50 percent or more; |
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(2) reduce the insurer's annual premium by 75 percent |
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or more in a line of insurance in this state; or |
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(3) reduce in this state, or in any applicable rating |
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territory, the insurer's total annual premium volume in a line of |
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personal automobile or residential property insurance by 50 percent |
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or more. |
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(b) An insurer shall file with the commissioner a plan for |
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orderly withdrawal if the insurer proposes to withdraw from writing |
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property and casualty insurance and controls 10 percent or more of |
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total annual premium volume of property and casualty insurance in |
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this state. |
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SECTION 2. Section 827.004, Insurance Code, is amended to |
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read as follows: |
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Sec. 827.004. PROVISIONS OF WITHDRAWAL PLAN. (a) A |
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withdrawal plan filed under Section 827.003 must: |
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(1) be constructed to protect the interests of the |
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people of this state; |
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(2) indicate the dates on which the insurer intends to |
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begin and to complete the plan; and |
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(3) provide for: |
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(A) meeting the insurer's contractual |
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obligations; |
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(B) providing service to the insurer's |
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policyholders and claimants in this state; and |
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(C) meeting any applicable statutory |
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obligations, such as payment of assessments to the guaranty fund |
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and participation in an assigned risk plan or joint underwriting |
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arrangement. |
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(b) In addition to the provisions required under Subsection |
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(a), a withdrawal plan filed under Section 827.003(b) must: |
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(1) provide for the insurer's incremental withdrawal |
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from the property and casualty market by reducing the insurer's |
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annual written premium in equal proportion over a 60-month period |
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beginning on the date of approval of the plan under Section 827.005; |
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and |
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(2) be constructed to allow the market an opportunity |
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to stabilize. |
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SECTION 3. Section 827.005(a), Insurance Code, is amended |
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to read as follows: |
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(a) Except as provided by Subsection (b), the commissioner |
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shall approve a withdrawal plan that adequately provides for |
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meeting the requirements prescribed by Section 827.004(a)(3) and, |
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if applicable, Section 827.004(b) [827.004(3)]. |
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SECTION 4. The change in law made by this Act applies only |
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to a withdrawal plan filed with the commissioner of insurance on or |
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after the effective date of this Act. A withdrawal plan filed with |
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the commissioner of insurance before the effective date of this Act |
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is governed by the law as it existed at the time the withdrawal plan |
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was filed, and that law is continued in effect for that purpose. |
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SECTION 5. This Act takes effect September 1, 2017. |