Texas 2023 - 88th Regular

Texas House Bill HB2752 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	88R21747 CJC-D
2	2	By: Schaefer H.B. No. 2752
3	3	Substitute the following for H.B. No. 2752:
4	4	By: Oliverson C.S.H.B. No. 2752
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to the authority of the Texas Department of Insurance to
10	10	adopt rules that implement or are based on certain environmental,
11	11	social, and governance models, ratings, or standards.
12	12	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
13	13	SECTION 1. Section 36.004, Insurance Code, is amended by
14	14	amending Subsection (b) and adding Subsection (d) to read as
15	15	follows:
16	16	(b) For purposes of Subsections [Subsection] (a) and (d) of
17	17	this section and Section 36.008, a version of a rule, regulation,
18	18	directive, or standard is expressly authorized by statute if:
19	19	(1) the statute explicitly authorizes the
20	20	commissioner to adopt rules consistent with the rule, regulation,
21	21	directive, or standard; or
22	22	(2) that version is the latest version of the rule,
23	23	regulation, directive, or standard on the date that the statute was
24	24	enacted.
25	25	(d) In this subsection, "environmental assessment," "social
26	26	assessment," and "governance assessment" have the meanings
27	27	assigned by Section 36.008. Notwithstanding Subsection (c) of this
28	28	section or any other law, the commissioner may not require an
29	29	insurer to comply with a rule, regulation, directive, or standard,
30	30	including an accounting standard, adopted by the National
31	31	Association of Insurance Commissioners if the rule, regulation,
32	32	directive, or standard is developed using a model, rating, or
33	33	standard that measures and considers environmental, social, and
34	34	governance assessments unless application of the rule, regulation,
35	35	directive, or standard is expressly authorized by statute.
36	36	SECTION 2. Subchapter A, Chapter 36, Insurance Code, is
37	37	amended by adding Section 36.008 to read as follows:
38	38	Sec. 36.008. RULES IMPLEMENTING CERTAIN ENVIRONMENTAL,
39	39	SOCIAL, AND GOVERNANCE MODELS, RATINGS, AND STANDARDS PROHIBITED.
40	40	(a) In this section:
41	41	(1) "Environmental assessment" means an assessment of
42	42	the response by or vulnerability of an entity to climate change,
43	43	including the extent of the entity's exposure to harm from
44	44	climate-related factors.
45	45	(2) "Governance assessment" means an assessment of the
46	46	ethical or moral principles that influence the corporate governance
47	47	of an entity, including the structure and composition of the
48	48	governing board, ownership structure, employee and officer pay
49	49	policy, and accounting methodology of the entity.
50	50	(3) "Social assessment" means an assessment of:
51	51	(A) the human capital management practices of an
52	52	entity, including employment practices, employee training and
53	53	development, employee safety, and the selection of suppliers and
54	54	vendors based on preferred labor standards;
55	55	(B) the potential for an entity's products to
56	56	directly or indirectly cause physical or financial harm to persons
57	57	or to identified groups of persons, including harm caused by
58	58	quality control or safety failures and the unintentional or
59	59	unauthorized release of personal identifying information held by
60	60	the entity;
61	61	(C) an entity's willingness to invest its
62	62	earnings or reserves to improve the quality and safety of the
63	63	entity's management practices and products and mitigate any
64	64	negative effect those practices and products may have on consumers
65	65	and the environment; or
66	66	(D) any other factor relating to the social
67	67	effect of the entity's practices or products, including opposition
68	68	to those practices and products and their effect on the supply
69	69	chain.
70	70	(b) This section applies only to a rule that:
71	71	(1) implements or is based on an interstate, national,
72	72	or international model, rating, or standard, including an
73	73	accounting standard, that measures and considers environmental,
74	74	social, and governance assessments;
75	75	(2) is intended to:
76	76	(A) protect the environment;
77	77	(B) evaluate the effect of a particular entity or
78	78	industry on the environment; or
79	79	(C) encourage an entity to engage in specific
80	80	activities or behaviors in response to environmental concerns; and
81	81	(3) may materially affect in an adverse manner the:
82	82	(A) economy of this state or a sector of the
83	83	economy of this state;
84	84	(B) productivity and competitiveness of an
85	85	entity doing business in this state;
86	86	(C) number of people employed in this state; or
87	87	(D) health and safety of the residents of this
88	88	state.
89	89	(c) The commissioner may not adopt or enforce a rule to
90	90	which this section applies:
91	91	(1) that was developed by an entity that is not
92	92	licensed or regulated by:
93	93	(A) the department;
94	94	(B) the National Association of Insurance
95	95	Commissioners; or
96	96	(C) an entity of this state or of the federal
97	97	government, other than an entity described by Paragraph (A) or (B),
98	98	that regulates the practice of insurance;
99	99	(2) that may affect the authority of this state to
100	100	regulate the practice of insurance in this state; and
101	101	(3) the adoption or enforcement of which is not
102	102	specifically authorized by statute.
103	103	(d) A person may file an action for declaratory judgment
104	104	challenging the adoption of a rule on the basis that the rule was
105	105	adopted in violation of this section. An action for declaratory
106	106	judgment under this section is governed by Section 2001.038,
107	107	Government Code. If the court determines that the rule was adopted
108	108	in violation of this section, the rule is invalid.
109	109	SECTION 3. The change in law made by this Act applies only
110	110	to a proposed rule for which notice is filed with the secretary of
111	111	state under Section 2001.023, Government Code, on or after the
112	112	effective date of this Act.
113	113	SECTION 4. This Act takes effect September 1, 2023.