Texas 2013 - 83rd Regular

Texas Senate Bill SB1672 Compare Versions

The same version is selected twice. Please select two different versions to compare.

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	By: Taylor S.B. No. 1672
2	2	(Eiland)
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the business of travel insurance; authorizing
8	8	penalties.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. The heading to Subchapter D, Chapter 4055,
11	11	Insurance Code, is amended to read as follows:
12	12	SUBCHAPTER D. TRAVEL INSURANCE [LICENSE]
13	13	SECTION 2. Section 4055.151, Insurance Code, is amended by
14	14	adding Subdivisions (1-b) and (2-b) to read as follows:
15	15	(1-b) "Supervising entity" means a travel insurance
16	16	supervising entity designated by an insurer under Section
17	17	4055.1515.
18	18	(2-b) "Travel retailer" means a business entity that
19	19	makes, arranges, or offers travel services.
20	20	SECTION 3. Subchapter D, Chapter 4055, Insurance Code, is
21	21	amended by adding Section 4055.1515 to read as follows:
22	22	Sec. 4055.1515. TRAVEL INSURANCE SUPERVISING ENTITY. An
23	23	insurer authorized to engage in the business of travel insurance in
24	24	this state may designate a travel insurance supervising entity for
25	25	purposes of this subchapter. The supervising entity must be:
26	26	(1) a licensed managing general agent;
27	27	(2) a licensed third-party administrator; or
28	28	(3) a licensed insurance agent, including a specialty
29	29	license holder and a person described by Section 4055.002(a).
30	30	SECTION 4. Sections 4055.152 and 4055.153, Insurance Code,
31	31	are amended to read as follows:
32	32	Sec. 4055.152. SPECIALTY [ISSUANCE OF] LICENSE; LICENSE NOT
33	33	REQUIRED FOR TRAVEL RETAILER. (a) The commissioner may issue to
34	34	an applicant under this chapter a specialty license that authorizes
35	35	the license holder to sell, solicit, or negotiate travel insurance
36	36	through a licensed insurer.
37	37	(b) Notwithstanding any other provision of this chapter or
38	38	this code, [the commissioner may issue a specialty license to] a
39	39	travel retailer that operates on behalf of and under the license and
40	40	direction of a supervising entity does not require a license issued
41	41	under this title, subject to Section 4055.153 [agency, the
42	42	franchisee of a travel agency, or a public carrier that complies
43	43	with this subchapter. The specialty license may be issued only for
44	44	the limited purposes specified by this subchapter].
45	45	Sec. 4055.153. AUTHORITY OF TRAVEL RETAILER [AGENCY OR
46	46	FRANCHISEE]. (a) A travel retailer may offer and disseminate
47	47	travel insurance as a service to the retailer's customers on behalf
48	48	of and under the license and direction of a supervising entity
49	49	[agency or franchisee licensed under this chapter may act as an
50	50	agent for an authorized insurer] only:
51	51	(1) in connection with the sale or arrangement of
52	52	transportation, [or] accommodations, or events for travelers; and
53	53	(2) with respect to travel insurance that includes:
54	54	(A) accident and health insurance that provides
55	55	coverage to a traveler for accidental death or dismemberment and
56	56	for medical expenses resulting from an accident or sickness
57	57	involving the traveler that occurs during the planned trip;
58	58	(B) insurance that provides coverage to a
59	59	traveler for expenses incurred as a result of trip cancellation or
60	60	interruption of a planned trip or event;
61	61	(C) personal effects insurance that provides
62	62	coverage to a traveler for loss of or damage to personal effects
63	63	during the planned trip or event;
64	64	(D) insurance that provides coverage for damage
65	65	to accommodations or rental vehicles [life insurance not exceeding
66	66	$150,000 on any one life covering risks of travel during a planned
67	67	trip]; or
68	68	(E) any other coverage the commissioner approves
69	69	as meaningful and appropriate in connection with the transportation
70	70	or accommodations arranged through a travel agency.
71	71	(b) Travel insurance does not include major medical expense
72	72	coverage for a traveler on a planned trip for six months or more,
73	73	including:
74	74	(1) an individual working abroad;
75	75	(2) an expatriate; and
76	76	(3) a military service member on deployment.
77	77	SECTION 5. Subchapter D, Chapter 4055, Insurance Code, is
78	78	amended by adding Sections 4055.154, 4055.155, 4055.156, and
79	79	4055.157 to read as follows:
80	80	Sec. 4055.154. TRAVEL INSURANCE GENERALLY. (a) A travel
81	81	retailer, or the supervising entity, shall provide to a traveler
82	82	seeking to purchase travel insurance:
83	83	(1) a description of the material terms or the actual
84	84	terms of the coverage;
85	85	(2) a description of the claims filing process;
86	86	(3) a description of the review and cancellation
87	87	process for the insurance policy; and
88	88	(4) the name and contact information for the insurer
89	89	and the supervising entity.
90	90	(b) Travel insurance coverage may be provided under an
91	91	individual policy or a group or master policy.
92	92	Sec. 4055.155. DUTIES OF INSURERS AND SUPERVISING ENTITIES.
93	93	(a) An insurer must notify the department in the manner prescribed
94	94	by the commissioner by rule of the designation of a supervising
95	95	entity described by Subsection (b).
96	96	(b) A supervising entity designated by an insurer that
97	97	provides travel insurance may authorize a travel retailer to offer
98	98	and disseminate a travel insurance policy on behalf of the
99	99	supervising entity by establishing a retailer registry.
100	100	(c) The registry established under Subsection (b) must be
101	101	maintained and updated on an ongoing basis in a form prescribed by
102	102	the commissioner by rule. The registry must include the name,
103	103	address, and contact information, and federal employer
104	104	identification number, if any, of each registered travel retailer
105	105	and an individual contact person at the retailer.
106	106	(d) The registry must be submitted to the department on the
107	107	request of the commissioner.
108	108	(e) The supervising entity must certify in a form prescribed
109	109	by the commissioner by rule that each registered travel retailer is
110	110	in compliance with 18 U.S.C. Section 1033.
111	111	(f) The supervising entity shall designate an individual
112	112	who is an officer of the entity and a licensed agent as the
113	113	compliance officer responsible for compliance with insurance laws,
114	114	rules, and regulations related to travel insurance.
115	115	(g) The compliance officer and the officers of the
116	116	supervising entity that direct or control the travel insurance
117	117	business of the supervising entity must submit fingerprints as
118	118	required by the commissioner by rule.
119	119	(h) The supervising entity shall provide travel insurance
120	120	instruction and training to each employee of a registered travel
121	121	retailer whose duties include offering and disseminating travel
122	122	insurance. The instruction and training material are subject to
123	123	review by the commissioner and must include instruction relating to
124	124	the insurance offered, ethical sales practices, and required
125	125	disclosures to travelers.
126	126	(i) The supervising entity is responsible for the acts of a
127	127	travel retailer and shall use reasonable means to ensure each
128	128	registered retailer's compliance with this subchapter.
129	129	Sec. 4055.156. DUTIES OF TRAVEL RETAILERS. (a) A travel
130	130	retailer offering and disseminating travel insurance under this
131	131	subchapter shall register with an insurer in a registry established
132	132	under Section 4055.155.
133	133	(b) The travel retailer shall make available to travelers
134	134	brochures or other written materials that:
135	135	(1) provide the name, address, and contact information
136	136	of the authorized insurer and the supervising entity;
137	137	(2) explain that the purchase of travel insurance is
138	138	not required for the purchase from the travel retailer of any other
139	139	product or service; and
140	140	(3) disclose that the travel retailer is authorized to
141	141	provide general information about travel insurance, including a
142	142	description of coverage and the price for coverage, but is not
143	143	qualified or authorized to provide answers to questions about
144	144	specific policy terms or to evaluate the adequacy of the traveler's
145	145	existing insurance coverage.
146	146	(c) A travel retailer may not:
147	147	(1) evaluate or interpret technical words or phrases
148	148	used in a travel insurance policy or benefits under or terms of the
149	149	policy;
150	150	(2) evaluate or provide advice related to a traveler's
151	151	existing insurance coverage; or
152	152	(3) advertise or otherwise hold out the travel
153	153	retailer as a license holder or an insurance expert.
154	154	(d) A travel retailer that complies with this subchapter may
155	155	receive compensation for offering and disseminating travel
156	156	insurance on behalf of a supervising entity on or after the date the
157	157	retailer registers with the insurer under this subchapter.
158	158	Sec. 4055.157. ENFORCEMENT. A supervising entity and a
159	159	travel retailer registered with the supervising entity are subject
160	160	to Chapters 82 and 83 and Subtitle C, Title 5.
161	161	SECTION 6. The commissioner of insurance shall promulgate
162	162	forms described by Section 4055.155, Insurance Code, as added by
163	163	this Act, as soon as practicable after the effective date of this
164	164	Act, but not later than January 1, 2014.
165	165	SECTION 7. This Act applies only to a travel insurance
166	166	policy that is delivered, issued for delivery, or renewed on or
167	167	after January 1, 2014. A policy delivered, issued for delivery, or
168	168	renewed before January 1, 2014, is governed by the law as it existed
169	169	immediately before the effective date of this Act, and that law is
170	170	continued in effect for that purpose.
171	171	SECTION 8. This Act takes effect September 1, 2013.