Texas House Bill HB651

Texas 2009 - 81st Regular

• Out of House Committee: 4/2/09
• Voted on by House: 4/9/09
• Out of Senate Committee: 5/4/09
• Voted on by Senate: 5/12/09
• Governor Action: 5/23/09
• Enrolled: 5/14/09
• Passed: 5/23/09

Caption

Relating to compensation of certain persons by a domestic insurance company.

Impact

The implications of HB 651 are significant for both insurance companies and their employees. By establishing a new compensation threshold, the bill may affect how insurance companies set salaries and bonuses, potentially leading to higher compensation for certain executives or affiliated individuals. This could also create competitive differentiation among companies in attracting top talent within the insurance industry. However, the requirement for board approval before such payments can be made adds an additional layer of accountability that could serve as a check on excessive remuneration practices.

Summary

House Bill 651 seeks to amend the Texas Insurance Code concerning the compensation limits for individuals associated with domestic insurance companies. The bill raises the maximum allowable compensation and emoluments to $150,000 per year for any person, firm, or corporation affiliated with the insurance company, provided that this amount is authorized by a vote of the company's board of directors or a designated committee. This legislative change aims to ensure that compensation structures within these companies remain equitable while also subject to oversight from the board.

Contention

Potential points of contention surrounding this bill might revolve around the balance between fair compensation for insurance executives and the ethical considerations of high earnings within the insurance sector. Critics may argue that raising the compensation limit could lead to unrestrained executive pay, particularly in an industry notorious for its profit margins. Advocates of the bill, on the other hand, may contend that adequate compensation is necessary to attract and retain skilled professionals capable of navigating the complexities of the insurance business. The discussion may also touch upon whether increased compensation should correspond with improved company performance and customer service.