HBA-JLV H.B. 1684 77(R)BILL ANALYSIS


Office of House Bill AnalysisH.B. 1684
By: Solomons
Financial Institutions
7/17/2001
Enrolled



BACKGROUND AND PURPOSE 

Current law provides that the seller of certain insurance products may
charge a policy or agent fee to defray the costs incurred in the writing
and processing of the insurance product.  Prior to the 77th Legislature,
state law did not provide that a policy or agent fee may be financed under
a retail installment contract.  This is important to the purchaser of an
insurance product purchased to protect the person during the term of a
retail installment contract.  While such an insurance product may be
legally financed along with everything else under the retail installment
contract, under the terms of the Finance Code, an accompanying policy fee
could not be financed causing the holder to pay cash out of pocket.  House
Bill 1684 provides that a policy fee may be financed along with other legal
charges under a retail installment agreement. 

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. 

ANALYSIS

House Bill 1684 amends the Finance Code to authorize a holder of a motor
vehicle retail installment contract to include, as a separate charge in the
contract, a policy or agent fee charged in connection with insurance
provided to the holder as additional protection for the contract. 

EFFECTIVE DATE

September 1, 2001.