82R11902 AJA-D
By: Martinez Fischer H.B. No. 3683
A BILL TO BE ENTITLED
AN ACT
relating to hearings and appeals in connection with the insurance
commissioner's disapproval of a property and casualty insurance
rate.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2251.007, Insurance Code, is amended to
read as follows:
Sec. 2251.007. HEARINGS; APPEAL OF RATE DISAPPROVAL
[ADMINISTRATIVE PROCEDURE ACT APPLICABLE]. (a) Except as provided
by this section, Chapter 2001, Government Code, applies to a
hearing [all rate hearings] conducted under this chapter.
(b) A hearing under Section 2251.104 or Subchapter D to
determine whether the commissioner will disapprove a rate in effect
or a filed rate, or a hearing to determine whether a rate is
excessive or unfairly discriminatory for purposes of Section
2254.003, shall be conducted by the commissioner in accordance with
procedures adopted by the commissioner by rule for the purposes of
this section. Chapter 2001, Government Code, and Subchapter D,
Chapter 36, do not apply to a hearing that is subject to this
subsection.
(c) An appeal of an order of the commissioner disapproving a
rate under this chapter shall be by petition for judicial review to
a Travis County district court. An appeal under this subsection
shall be expedited in accordance with the rules adopted by the
supreme court under this section.
(d) A court in which a petition for judicial review is filed
under Subsection (c) shall:
(1) notwithstanding Section 2251.151(b), promptly set
a temporary rate to be used by the insurer until a final,
unappealable determination is made with respect to the rate being
appealed; and
(2) make a final determination with respect to the
rate that may be used by the insurer.
(e) A temporary or final rate set by a court under this
section may not be greater than the higher of the disapproved rate
or the insurer's rate in effect immediately preceding the filing of
the disapproved rate or lower than the lower of those two rates.
(f) A temporary rate set by a court under Subsection (d) is
not subject to interlocutory appeal.
(g) A district court's final determination in an appeal
under this section may be appealed to the Third Court of Appeals. A
determination by the Third Court of Appeals under this section may
be appealed to the supreme court. An appeal under this section
shall be expedited in accordance with rules adopted by the supreme
court under this section.
(h) The supreme court shall adopt rules under which review
by a district court, the Third Court of Appeals, or the supreme
court under this section is to be expedited.
(i) Judicial review under this section is under the
substantial evidence rule.
(j) An insurer using a temporary rate set under this section
shall set aside premiums collected using that rate until a final,
unappealable determination with respect to the rate is made by a
court under this section.
(k) If the court making the final, unappealable
determination under this section determines a rate to be used by the
insurer that is less than the temporary rate, the insurer shall
promptly refund the excess premiums to the affected policyholders.
If the court determines that the disapproved rate is excessive or
unfairly discriminatory, the court shall order the insurer to
comply with Section 2254.003(b).
SECTION 2. Section 2251.151(a-1), Insurance Code, and
Section 2254.004, Insurance Code, are repealed.
SECTION 3. Not later than December 1, 2011, the
commissioner of insurance and the Supreme Court of Texas shall
adopt rules under Section 2251.007, Insurance Code, as amended by
this Act.
SECTION 4. Section 2251.007, Insurance Code, as amended by
this Act, applies only to a hearing under Chapter 2251, Insurance
Code, that is commenced on or after January 1, 2012, and an appeal
of an order of the commissioner of insurance made in connection with
that hearing. A hearing commenced before January 1, 2012, and an
appeal of an order made in connection with that hearing 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 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2011.