HBA-ATS H.B. 2550 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2550 By: Janek Insurance 4/16/1999 Introduced BACKGROUND AND PURPOSE The Insurance Code limits the amount of life insurance that can be purchased on a spouse life under a group life insurance policy. Currently, a group term life insurance policy upon the life of a spouse is prohibited from exceeding the lesser of $10,000 or one-half of the amount of insurance of an insured employee under a group policy. H.B. 2550 deletes the condition that a group term life insurance policy upon the life of a spouse is prohibited from exceeding the lesser of $10,000 or onehalf of the amount of insurance of an insured employee under the group policy. In addition, this bill prohibits the amount of insurance of the spouse of the insured under any group term life insurance policy from exceeding an amount equal to the amount of insurance on the insured, and the amount of insurance on the life of a child from exceeding one-half of the amount of insurance on the life of the insured. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 1, Article 3.50, Insurance Code, as follows: Sec. 1. DEFINITIONS. (a) Prohibits any group life insurance policy (policy) from being delivered in this state unless it conforms to one of the policies described under this section. (b) Authorizes a policy to be issued to an employer, who is the policyholder, to insure employees of the employer for the benefit of persons other than the employer, subject to certain enumerated requirements. (c) Makes conforming changes. (d) Makes conforming changes. (e) Makes conforming changes. (f) Makes conforming changes. (g) Makes a conforming change. (h) Makes conforming changes. (i) Makes conforming changes and a nonsubstantive change. (j) Makes conforming changes. (k) Makes conforming changes. (l) Deletes the condition that a group term life insurance policy upon the life of a spouse is prohibited from exceeding the lesser of $10,000 or one half of the amount of insurance of an insured employer under the group policy. Makes conforming and nonsubstantive changes. (m) Makes conforming changes. SECTION 2. Amends Section 1, Article 3.51-4A, Insurance Code, as follows: Sec. 1. (a) Specifies that the spouse and children are the spouse and children of the insured. Makes conforming and nonsubstantive changes. (b) Makes conforming and nonsubstantive changes. (c) Prohibits the amount of insurance of the spouse of the insured under any group term life insurance policy from exceeding an amount equal to the amount of insurance on the insured. Prohibits the amount of insurance on the life of a child from exceeding one-half of the amount of insurance on the life of the insured. SECTION 3. Makes application of this Act prospective for a group life insurance policy that is delivered, issued for delivery, or renewed on or after January 1, 2000. SECTION 4.Emergency clause. Effective date: 90 days after adjournment.