HBA-TYH H.B. 792 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 792 By: Maxey Insurance 2/11/1999 Introduced BACKGROUND AND PURPOSE Currently, the Texas Department of Insurance (TDI) regulates the viatical settlement industry. Since the enactment of the regulating legislation though, the industry has shifted from its original focus on serving the terminally ill and now offers viatical settlements to healthy seniors as well. The original legislation defined a viatical settlement to apply only to the sale of a policy of an individual with a terminal illness. Thus, settlements involving healthy seniors are not included in the TDI's regulatory powers. H.B. 792 expands the statutory definition of "viatical settlement" to cover any transfer of an individual's life insurance benefit in exchange for payment and authorizes TDI to use the same powers that are generally available to it for enforcement of the Insurance Code. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Commissioner of Insurance (commissioner) in SECTION 2 (Section 3, Article 3.50-6A, Insurance Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 1(2), Article 3.50-6A, Insurance Code, by establishing that a "viatical settlement" concerns the life insurance policy of an individual, rather than that of an individual who has a catastrophic or life-threatening illness or condition. SECTION 2. Amends Sections 3 and 4, Article 3.50-6A, Insurance Code, as follows: Sec. 3. New title: APPLICATION OF OTHER INSURANCE LAWS. Authorizes the commissioner by rule to specify other provisions of this code or other insurance laws of this state that apply to a person engaging in the business of viatical settlements. Deletes existing text. Sec. 4. ENFORCEMENT. Authorizes the commissioner to take any appropriate action against a person engaging in the business of viatical settlements who violates this article, an applicable provision of this code or another insurance law of this state, or a rule adopted under this article or under such a provision. Deletes existing text. SECTION 3. Makes application of this Act prospective. SECTION 4. Effective date: September 1, 1999. SECTION 5. Emergency clause.