BILL ANALYSIS HBA-NIK H.B. 3307 76(R) Office of House Bill AnalysisH.B. 3307 By: Thompson Insurance 4/19/1999 Introduced BACKGROUND AND PURPOSE Currently, the Residential Market Assistance Program (MAP) assists homeowners in obtaining residential property insurance coverage in underserved areas. However, consumers cannot apply directly for coverage through MAP due to the requirement that the Texas Department of Insurance (department) accept applications only from licensed agents, known as originating agents. If a consumer contacts the department directly, the department must then refer the applicant to an originating agent, which can delay the processing of application to MAP. H.B. 3307 allows the applicant to bypass the originating agent and contact the department directly. 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 2(b), Article 21.49-12, Insurance Code, to delete the requirement that the plan of operation will include applications that will be accepted only from agents duly licensed by the Texas Department of Insurance (department) and that applications from all other sources will be returned for referral to duly licensed agents of the applicant's choice for preparation and resubmission to the program. Requires the market assistance program (program) to notify the applicant or the applicant's agent if an agent is used so that the placement of the insurance may be completed, rather than authorizing the agent to complete it. Makes a conforming and nonsubstantive change. Subdivisions (3)-(5) redesignated to (2)-(4). Subdivisions (7)-(8) redesignated to (6)-(7). SECTION 2. Amends Section 4, Article 21.49-12, Insurance Code, as follows: Sec. 4. New title: DIRECT REFERRAL TO INSURER; AGENTS. (a) Authorizes the department to assist an applicant for coverage through the program in completing an initial application, and refer the applicant to one or more participating companies. (c) Provides that an applicant is not required to submit the application through an originating agent. Provides that if an originating agent is used, the originating agent is not required to be appointed to represent the ultimate insurer. Makes a conforming and nonsubstantive change. (e) Requires the, rather than an, originating agent, if any, to share commissions with the issuing agent under certain conditions. Makes a conforming change. (f) Authorizes the originating agent, if any, and the issuing agent to be the same person. SECTION 3. Effective date: September 1, 1999. Makes application of this Act prospective in regard to an application for assistance under the market assistance program established by Article 21.49-12, Insurance Code, that is submitted on or after January 1, 2000. SECTION 4. Emergency clause.