81R11277 AJA-F
By: Lucio III H.B. No. 4638
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of certain insurers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Article 5.13(a), Insurance Code, is amended to
read as follows:
(a) This subchapter applies to every insurance company,
corporation, interinsurance exchange, mutual, reciprocal,
association, Lloyd's plan, or other organization or insurer writing
any of the characters of insurance business herein set forth,
hereinafter called "Insurer"; provided that nothing in this entire
subchapter shall be construed to apply to any county or farm mutual
insurance company or association, as regulated under Chapters 911
and 912 of this code, except that[:
[(1)] Article 5.13-2 of this code shall apply to a
county mutual insurance company with respect to personal automobile
and commercial automobile insurance, residential and commercial
property insurance, and inland marine insurance[;
[(2) Article 5.20 of this code shall apply to a county
mutual insurance company with respect to each line of insurance
that a county mutual insurance company is authorized to write under
Section 912.151; and
[(3) Article 5.20 of this code shall apply to a farm
mutual insurance company with respect to each line of insurance
that a farm mutual insurance company is authorized to write under
Section 911.151].
SECTION 2. Section 822.055(d), Insurance Code, is amended
to read as follows:
(d) The shareholders of an insurance company authorizing
par value shares of stock must in good faith subscribe and fully pay
for shares representing at least 50 percent of the total par value
of the authorized shares with a par value [before the company:
[(1) is granted a charter; or
[(2) amends its charter to:
[(A) authorize the issuance of par value shares;
or
[(B) increase or decrease from time to time the
number of authorized par value shares].
SECTION 3. Section 822.056(d), Insurance Code, is amended
to read as follows:
(d) The shareholders of an insurance company authorizing
shares of stock without par value must in good faith subscribe and
pay for shares representing at least 50 percent of the authorized
shares without par value before the company is granted a charter [or
has its charter amended to authorize the issuance of shares without
par value]. The total amount paid for the shares must be at least
$250,000.
SECTION 4. Section 912.152(a), Insurance Code, is amended
to read as follows:
(a) A county mutual insurance company is subject to:
(1) Sections 1952.051-1952.055;
(2) Subchapter B, Chapter 2002; and
(3) Chapter 2301[; and
[(4) Articles 5.06 and 5.35].
SECTION 5. Section 912.301, Insurance Code, is amended to
read as follows:
Sec. 912.301. ANNUAL REPORT [REGARDING CONDITION OF
COMPANY]. Not later than March 1 of each year, each county mutual
insurance company shall file with the department a verified report
on a form prepared by the department of:
(1) the business conducted by the company during the
preceding year;
(2) the condition of the affairs of the company; and
(3) any other information required by the department.
[(a) The commissioner may, at any time the commissioner determines
advisable, compel written reports from a county mutual insurance
company regarding the company's condition.
[(b) The commissioner may require that the report be
verified under oath by a responsible officer of the company.]
SECTION 6. Section 1953.001(b), Insurance Code, is amended
to read as follows:
(b) A type or class of insurance to which this section
applies is excluded from regulation under this chapter and:
(1) Articles 5.01, 5.01B, 5.03, 5.04, and 5.04-1[,
5.06, 5.10, and 5.11];
(2) Chapters 251 and 254;
(3) Subchapters A and B, Chapter 1806; and
(4) Chapters 1951 and 1952.
SECTION 7. The following sections of the Insurance Code are
repealed:
(1) Section 911.067;
(2) Section 912.061; and
(3) Section 912.302.
SECTION 8. (a) The repeal by this Act of Sections 911.067
and 912.061, Insurance Code, does not apply to an application for an
extension of charter submitted before the effective date of this
Act. An application submitted before the effective date of this Act
is governed by the law in effect immediately before the effective
date of this Act, and that law is continued in effect for that
purpose.
(b) The repeal by this Act of Section 912.302, Insurance
Code, applies only to an annual statement filed on or after the
effective date of this Act. A statement filed before the effective
date of this Act is governed by the law in effect immediately before
the effective date of this Act, and that law is continued in effect
for that purpose.
SECTION 9. This Act takes effect September 1, 2009.