| 1 | 1 | | 87R7524 JES-F |
|---|
| 2 | 2 | | By: Leman H.B. No. 2665 |
|---|
| 3 | 3 | | |
|---|
| 4 | 4 | | |
|---|
| 5 | 5 | | A BILL TO BE ENTITLED |
|---|
| 6 | 6 | | AN ACT |
|---|
| 7 | 7 | | relating to the size, terms, and election of boards of directors of |
|---|
| 8 | 8 | | certain insurance companies. |
|---|
| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|---|
| 10 | 10 | | SECTION 1. Section 822.152(b), Insurance Code, is amended |
|---|
| 11 | 11 | | to read as follows: |
|---|
| 12 | 12 | | (b) The board consists of not fewer than five [seven] |
|---|
| 13 | 13 | | directors. A director: |
|---|
| 14 | 14 | | (1) is not required to be a shareholder unless such a |
|---|
| 15 | 15 | | qualification is required by the articles of incorporation or |
|---|
| 16 | 16 | | bylaws of the company; and |
|---|
| 17 | 17 | | (2) serves until the director's successor is elected |
|---|
| 18 | 18 | | and accepts the position. |
|---|
| 19 | 19 | | SECTION 2. Section 822.153(b), Insurance Code, is amended |
|---|
| 20 | 20 | | to read as follows: |
|---|
| 21 | 21 | | (b) The shareholders of an insurance company shall meet |
|---|
| 22 | 22 | | annually [before May 1 of each year] as provided by the company's |
|---|
| 23 | 23 | | bylaws to elect successor directors. |
|---|
| 24 | 24 | | SECTION 3. Section 841.153(b), Insurance Code, is amended |
|---|
| 25 | 25 | | to read as follows: |
|---|
| 26 | 26 | | (b) After the directors are first elected under this |
|---|
| 27 | 27 | | section, the annual meeting must be held [before May 1 of] each year |
|---|
| 28 | 28 | | as established by the company's bylaws. The directors serve |
|---|
| 29 | 29 | | one-year terms beginning immediately after the election, except as |
|---|
| 30 | 30 | | provided by Section 841.154. |
|---|
| 31 | 31 | | SECTION 4. The heading to Section 841.154, Insurance Code, |
|---|
| 32 | 32 | | is amended to read as follows: |
|---|
| 33 | 33 | | Sec. 841.154. STAGGERED TERMS FOR [LARGE BOARD OF] |
|---|
| 34 | 34 | | DIRECTORS. |
|---|
| 35 | 35 | | SECTION 5. Section 841.154(a), Insurance Code, is repealed. |
|---|
| 36 | 36 | | SECTION 6. The changes in law made by this Act apply only to |
|---|
| 37 | 37 | | the election of members of the board of directors of an insurance |
|---|
| 38 | 38 | | company who are elected on or after the effective date of this Act. |
|---|
| 39 | 39 | | The election of members of the board of directors of an insurance |
|---|
| 40 | 40 | | company who were elected before the effective date of this Act is |
|---|
| 41 | 41 | | governed by the law in effect when that election was held, and that |
|---|
| 42 | 42 | | law is continued in effect for that purpose. |
|---|
| 43 | 43 | | SECTION 7. This Act takes effect September 1, 2021. |
|---|