81R8949 PB-D
By: Sheffield H.B. No. 1476
A BILL TO BE ENTITLED
AN ACT
relating to capital stock and surplus requirements for certain
insurance companies.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 822.054(a), Insurance Code, is amended
to read as follows:
(a) An insurance company must have capital stock in an
amount of at least $2.5 [$1] million and surplus in an amount of at
least $2.5 [$1] million.
SECTION 2. Sections 822.212(a) and (b), Insurance Code, are
amended to read as follows:
(a) Notwithstanding Section 822.203, to engage in the kinds
of insurance business for which an insurance company organized
under this chapter holds a certificate of authority in this state,
an insurance company organized under this chapter that on September
1, 2009 [1991], had less than the minimum amount of capital and
surplus required for a newly incorporated company under Section
822.054 must:
(1) not later than December 31, 2018 [2000], have
increased the amount of its capital by at least 90 percent of the
difference between the amount of minimum capital required for a
newly incorporated company under Section 822.054 and the amount of
the company's capital on December 31, 2009 [1991]; and
(2) not later than December 31, 2019 [2001], have at
least the minimum amount of capital required under Section 822.054
for a newly incorporated company.
(b) An insurance company that on September 1, 2009 [1991],
had less than the minimum amount of capital and surplus required for
a newly incorporated company under Section 822.054 shall
immediately increase the amount of its capital and surplus to an
amount equal to the required amount of capital and surplus under
Section 822.054 if there is:
(1) a change in the control of at least 50 percent of
the voting securities of the insurance company;
(2) a change in the control of at least 50 percent of
the voting securities of a holding company controlling the
insurance company; or
(3) a change in control of at least 50 percent by any
other method of control if the insurance company or holding company
is not controlled by voting securities.
SECTION 3. This Act takes effect September 1, 2009.