S.B. No. 1450
AN ACT
relating to the regulatory authority of the commissioner of
insurance and the Texas Department of Insurance.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 36.004, Insurance Code, is amended to
read as follows:
Sec. 36.004. COMPLIANCE WITH NATIONAL ASSOCIATION OF
INSURANCE COMMISSIONERS REQUIREMENTS; RULES. (a) Except as
provided by Subsection (c) and Section 36.005, the department may
not require an insurer to comply with a rule, regulation,
directive, or standard adopted by the National Association of
Insurance Commissioners, including a rule, regulation, directive,
or standard relating to policy reserves, unless application of the
rule, regulation, directive, or standard is expressly authorized by
statute [and approved by the commissioner].
(b) For purposes of Subsection (a), a version of a rule,
regulation, directive, or standard is expressly authorized by
statute if:
(1) the statute explicitly authorizes the
commissioner to adopt rules consistent with the rule, regulation,
directive, or standard; or
(2) that version is the latest version of the rule,
regulation, directive, or standard on the date that the statute was
enacted.
(c) The commissioner may adopt a rule to require compliance
with a rule, regulation, directive, or standard adopted by the
National Association of Insurance Commissioners if:
(1) the commissioner finds the rule is technical or
nonsubstantive in nature or necessary to preserve the department's
accreditation; and
(2) before the adoption of the rule, the commissioner
provides the standing committees of the senate and house of
representatives with primary jurisdiction over the department with
written notice of the commissioner's intent to adopt the rule.
SECTION 2. Subchapter A, Chapter 36, Insurance Code, is
amended by adding Section 36.007 to read as follows:
Sec. 36.007. RULES RELATING TO AGREEMENTS LIMITING STATE
AUTHORITY TO REGULATE INSURANCE PROHIBITED; EFFECT OF AGREEMENT.
(a) The commissioner may not adopt or enforce a rule that
implements an interstate, national, or international agreement
that:
(1) infringes on the authority of this state to
regulate the business of insurance in this state; and
(2) was not approved by the legislature.
(b) An agreement described by Subsection (a) has no effect
on the authority of this state to regulate the business of insurance
in this state unless the agreement is approved by the legislature.
SECTION 3. Subchapter C, Chapter 551, Insurance Code, is
amended by adding Section 551.1041 to read as follows:
Sec. 551.1041. RULEMAKING AUTHORITY RELATING TO NOTICE OF
CANCELLATION OF CERTAIN PERSONAL AUTOMOBILE INSURANCE COVERAGES.
The commissioner shall exercise the commissioner's rulemaking
authority to adopt rules under which an insurer that cancels a
personal automobile insurance policy that provides comprehensive
or collision physical damage coverage for an automobile that is
subject to a purchase money lien is required to notify the
lienholder, if known, that the coverage will be canceled.
SECTION 4. Section 36.004, Insurance Code, as amended by
this Act, applies only to a rule adopted or amended on or after the
effective date of this Act. A rule adopted before the effective
date of this Act and not amended on or after that date is governed by
the law applicable to the rule 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, 2017.
______________________________ ______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 1450 passed the Senate on
May 4, 2017, by the following vote: Yeas 31, Nays 0; May 26, 2017,
Senate refused to concur in House amendments and requested
appointment of Conference Committee; May 27, 2017, House granted
request of the Senate; May 28, 2017, Senate adopted Conference
Committee Report by the following vote: Yeas 30, Nays 1.
______________________________
Secretary of the Senate
I hereby certify that S.B. No. 1450 passed the House, with
amendments, on May 24, 2017, by the following vote: Yeas 141,
Nays 4, one present not voting; May 27, 2017, House granted request
of the Senate for appointment of Conference Committee;
May 28, 2017, House adopted Conference Committee Report by the
following vote: Yeas 99, Nays 47, one present not voting.
______________________________
Chief Clerk of the House
Approved:
______________________________
Date
______________________________
Governor