HBA-ATS S.B. 105 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 105 By: Harris Insurance 3/10/1999 Engrossed BACKGROUND AND PURPOSE The Insurance Code (code) requires every title insurance company, title insurance agent, and direct operation to prepare an annual audit of trust fund accounts and to submit it to the State Board of Insurance (board). The code also prescribes the procedures that need to be followed and establishes the deadline for submission of the audit. S.B. 105 amends these procedures by changing the office to which the annual audit report is submitted from the State Board of Insurance to the Texas Department of Insurance. In addition, this bill establishes a new deadline for submitting the audit by changing the date from within ninety days from the end of every title insurance agent's and direct operation's fiscal year to before the 91st day after the end of the fiscal year. This bill also deletes the requirement that a title insurance company needs to perform an analysis of its audit report for the board. 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 Article 9.39, Insurance Code, as follows: (a) Requires an annual audit of trust fund accounts held by a title insurance agent and direct operation to occur before the 91st day after, rather than within 90 days from, the end of every title insurance agent's and direct operation's fiscal year. Requires the annual audit to be sent to the Texas Department of Insurance (department), rather than the State Board of Insurance (board). Makes a nonsubstantive change. (b) Makes conforming changes. (c) Requires the commissioner of insurance (commissioner), rather than the board, to set forth the standards of the annual audit and the form of the audit report. (d) Created from existing text. (e) Deletes text requiring each title insurance company to examine and analyze the audit reports created by its agents and direct operations, and requiring each title insurance company to reports its findings of its examination within three months. Requires a title insurance company to report to the department, rather than the board, by the 30th day after the expiration of the 90-day period, the failure of its agents or direct operations to deliver an audit report before the 91st day after the date, rather than within three months, of the termination of the fiscal year of the agent or direct operation. Makes nonsubstantive changes. (f) Makes conforming changes. (g) Makes a conforming change. (h) Requires those wronged by any action of the commissioner, rather than the board, to have the right to appeal under Article 1.04 (Appeal of Decision of Commissioner), rather than to file a suit under Article 9.37(Agent's Licenses: Surrender, Forfeiture; Grounds for Revocation; Notice, Hearing and Appeal). SECTION 2. Effective date: September 1, 1999. SECTION 3. Emergency clause.