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


Office of House Bill AnalysisC.S.H.B. 1684
By: Solomons
Financial Institutions
4/2/2001
Committee Report (Substituted)



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.  Current law does not provide,
however, 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 may not be
financed causing the holder to pay cash out of pocket.  C.S.H.B. 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

C.S.H.B. 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

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001. 

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 1684 modifies the original to make a technical correction by
removing the word "finance" from the caption to conform to the body of the
bill.