Texas 2017 - 85th Regular

Texas House Bill HB127 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	85R1727 SCL-D
2	2	By: White H.B. No. 127
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the use of credit scoring in the underwriting and rating
8	8	of certain insurance policies.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Subchapter A, Chapter 559, Insurance Code, is
11	11	amended by adding Section 559.0025 to read as follows:
12	12	Sec. 559.0025. SUSPENSION OF USE OF CREDIT SCORING. (a) An
13	13	insurer may not use credit scoring in the underwriting or rating of
14	14	an insurance policy to which this chapter applies and that is
15	15	delivered, issued for delivery, or renewed on or after January 1,
16	16	2018.
17	17	(b) This section expires January 1, 2020.
18	18	SECTION 2. (a) In this section:
19	19	(1) "Commissioner" means the commissioner of
20	20	insurance.
21	21	(2) "Committee" means the Committee on Insurer Use of
22	22	Credit Scoring.
23	23	(b) The commissioner shall establish the Committee on
24	24	Insurer Use of Credit Scoring to develop and make recommendations
25	25	on whether credit scoring should be used in the underwriting or
26	26	rating of insurance and if so, how the use of credit scoring may be
27	27	improved. The recommendations must also specifically address the
28	28	question of whether the lack of a credit score should ever influence
29	29	insurance rates.
30	30	(c) The committee is composed of nine members appointed by
31	31	the commissioner as follows:
32	32	(1) at least one representative of the insurance
33	33	industry;
34	34	(2) at least one representative of the Office of
35	35	Public Insurance Counsel;
36	36	(3) at least one policyholder who is not affiliated
37	37	with the insurance industry; and
38	38	(4) other members who represent one of the categories
39	39	listed in Subdivisions (1), (2), and (3) of this subsection.
40	40	(d) The commissioner shall designate one member to serve as
41	41	the presiding officer of the committee.
42	42	(e) A committee member is not entitled to compensation for
43	43	service on the committee but is entitled to reimbursement for
44	44	actual and necessary expenses incurred in performing committee
45	45	duties.
46	46	(f) The committee shall meet at least quarterly on the call
47	47	of the presiding officer. Committee meetings are subject to the
48	48	open meetings law, Chapter 551, Government Code.
49	49	(g) The Texas Department of Insurance shall provide
50	50	administrative support for the committee. Funding for the
51	51	administrative and operational expenses of the committee shall be
52	52	provided from the department's existing budget.
53	53	(h) The committee's development of recommendations under
54	54	this section must be based on a study of the effects of the use of
55	55	credit scoring in the underwriting and rating of insurance. The
56	56	study must, at a minimum, address and include findings regarding:
57	57	(1) the effect of credit scoring on:
58	58	(A) the elderly;
59	59	(B) young people; and
60	60	(C) people with little or no credit history,
61	61	including wealthy people;
62	62	(2) the range of effects that credit scoring has on
63	63	insurance rates; and
64	64	(3) the rate of errors in computing credit scores.
65	65	(i) The committee shall prepare a written report of the
66	66	committee's findings and recommendations under this section. The
67	67	committee shall deliver the report to the governor, the lieutenant
68	68	governor, and all members of the legislature not later than
69	69	December 1, 2018.
70	70	(j) The committee is abolished and this section expires June
71	71	1, 2019.
72	72	SECTION 3. This Act takes effect September 1, 2017.