Texas 2013 - 83rd Regular

Texas Senate Bill SB1006

Filed
 
Out of Senate Committee
 
Voted on by Senate
 
Out of House Committee
 
Voted on by House
 
Governor Action
 

Caption

Relating to requirements regarding certain shareholder and policyholder dividends.

Impact

The implications of SB1006 on state laws are significant, as it instills stricter controls on how insurers manage their surplus and handle dividend distributions. This could enhance the financial stability of insurance companies, ensuring they maintain adequate reserves before declaring dividends, thereby protecting policyholders' interests. Additionally, the bill allows for profit sharing with members of certain nonprofit business associations, opening avenues for collective benefits among policyholders. This modification fosters a more collaborative approach to profit distribution and leverages group programs for insurances.

Summary

SB1006 addresses shareholder and policyholder dividends within the Texas insurance sector, specifically amending several sections of the Insurance Code. The bill lays down new requirements before insurers can distribute profits or dividends to shareholders, mandating that these payments can only come from surplus profits generated by their operations. Moreover, it introduces regulations on policyholder dividends, especially in circumstances where dividends exceed 10% of surplus, requiring insurer notifications and commissioner approvals for these distributions. This legislative effort intends to promote accountability and proper financial management among insurers.

Contention

During the discussions surrounding SB1006, there were notable points of contention regarding the proposed regulatory measures. Supporters emphasized the need for stricter financial governance in the insurance industry to prevent irresponsible profit sharing that could undermine the insurer's ability to meet policyholder claims. In contrast, some critics expressed concerns about potential overreach and the bureaucratic hurdles that may emerge for insurers when complying with heightened approval processes. Balancing financial accountability while promoting an effective insurance market remains a central concern in the discourse around this bill.

Companion Bills

TX HB2030

Identical Relating to requirements regarding certain shareholder and policyholder dividends.

Previously Filed As

TX HB3391

Relating to disclosures by liability insurers and policyholders to third-party claimants; providing an administrative penalty.

TX HB1992

Relating to policyholder approval for certain windstorm and hail insurance rate changes.

TX HB3359

Relating to network adequacy standards and other requirements for preferred provider benefit plans.

TX SB1765

Relating to network adequacy standards and other requirements for preferred provider benefit plans.

TX HB3867

Relating to requirements regarding certain behavior management for a student enrolled in a special education program of a public school and related reporting requirements regarding the use of restraint.

TX HB4498

Relating to the transfer and statutory novation of insurance policies from a transferring insurer to an assuming insurer through an insurance business transfer plan; authorizing fees.

TX SB1217

Relating to the Texas Windstorm Insurance Association.

TX HB2017

Relating to innovation waivers for certain insurance laws, regulations, and requirements; authorizing a fee.

TX SB2340

Relating to innovation waivers for certain insurance laws, regulations, and requirements; authorizing a fee.

TX HB2880

Relating to the administration of the Texas Windstorm Insurance Association.

Similar Bills

TX HB2030

Relating to requirements regarding certain shareholder and policyholder dividends.

MS SB2412

Insurance Holding Company Act; include NAIC Group Capital Calculation test requirements.

MS HB1172

Holding Company Act; amend to include group capital calculation and liquidity stress test requirements to.

ND HB1124

The standards and management of an insurer with an insurance holding company system and the confidential treatment of investigation and examination records of insurance holding companies.

OK HB4230

Insurance; insurers; Insurance Commissioner; jurisdiction; delinquency proceedings; effective date.

KS SB121

Authorizing the commissioner of insurance to select and announce the version of certain instructions, calculations and documents in effect for the upcoming calendar year and cause such announcement to be published in the Kansas register, allowing certain life insurers to follow health financial reports and adopting certain provisions from the national association of insurance commissioners holding company system regulatory act relating to group capital calculations and liquidity stress testing.

KS HB2128

Authorizing the commissioner of insurance to select and announce the version of certain instructions, calculations and documents in effect for the upcoming calendar year and cause such announcement to be published in the Kansas register, allowing certain life insurers to follow health financial reports and adopting certain provisions from the national association of insurance commissioners holding company system regulatory act relating to group capital calculations and liquidity stress testing.

OK SB1246

Insurance; establishing requirements for receivership; modifying receivership court proceedings. Effective date.