| 4 | 6 | | AN ACT |
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| 5 | 7 | | relating to the size, terms, and election of boards of directors of |
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| 6 | 8 | | certain insurance companies. |
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| 7 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 8 | 10 | | SECTION 1. Section 822.152(b), Insurance Code, is amended |
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| 9 | 11 | | to read as follows: |
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| 10 | 12 | | (b) The board consists of not fewer than five [seven] |
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| 11 | 13 | | directors. A director: |
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| 12 | 14 | | (1) is not required to be a shareholder unless such a |
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| 13 | 15 | | qualification is required by the articles of incorporation or |
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| 14 | 16 | | bylaws of the company; and |
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| 15 | 17 | | (2) serves until the director's successor is elected |
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| 16 | 18 | | and accepts the position. |
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| 17 | 19 | | SECTION 2. Section 822.153(b), Insurance Code, is amended |
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| 18 | 20 | | to read as follows: |
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| 19 | 21 | | (b) The shareholders of an insurance company shall meet |
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| 20 | 22 | | annually [before May 1 of each year] as provided by the company's |
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| 21 | 23 | | bylaws to elect successor directors. |
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| 22 | 24 | | SECTION 3. Section 841.153(b), Insurance Code, is amended |
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| 23 | 25 | | to read as follows: |
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| 24 | 26 | | (b) After the directors are first elected under this |
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| 25 | 27 | | section, the annual meeting must be held [before May 1 of] each year |
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| 26 | 28 | | as established by the company's bylaws. The directors serve |
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| 27 | 29 | | one-year terms beginning immediately after the election, except as |
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| 28 | 30 | | provided by Section 841.154. |
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| 29 | 31 | | SECTION 4. The heading to Section 841.154, Insurance Code, |
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| 30 | 32 | | is amended to read as follows: |
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| 31 | 33 | | Sec. 841.154. STAGGERED TERMS FOR [LARGE BOARD OF] |
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| 32 | 34 | | DIRECTORS. |
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| 33 | 35 | | SECTION 5. Section 841.154(a), Insurance Code, is repealed. |
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| 34 | 36 | | SECTION 6. The changes in law made by this Act apply only to |
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| 35 | 37 | | the election of members of the board of directors of an insurance |
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| 36 | 38 | | company who are elected on or after the effective date of this Act. |
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| 37 | 39 | | The election of members of the board of directors of an insurance |
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| 38 | 40 | | company who were elected before the effective date of this Act is |
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| 39 | 41 | | governed by the law in effect when that election was held, and that |
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| 40 | 42 | | law is continued in effect for that purpose. |
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| 41 | 43 | | SECTION 7. This Act takes effect September 1, 2021. |
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| 42 | | - | ______________________________ ______________________________ |
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| 43 | | - | President of the Senate Speaker of the House |
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| 44 | | - | I hereby certify that S.B. No. 918 passed the Senate on |
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| 45 | | - | April 9, 2021, by the following vote: Yeas 31, Nays 0. |
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| 46 | | - | ______________________________ |
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| 47 | | - | Secretary of the Senate |
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| 48 | | - | I hereby certify that S.B. No. 918 passed the House on |
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| 49 | | - | May 23, 2021, by the following vote: Yeas 145, Nays 0, one |
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| 50 | | - | present not voting. |
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| 51 | | - | ______________________________ |
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| 52 | | - | Chief Clerk of the House |
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| 53 | | - | Approved: |
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| 54 | | - | ______________________________ |
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| 55 | | - | Date |
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| 56 | | - | ______________________________ |
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| 57 | | - | Governor |
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