HBA-AMW H.B. 3013 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3013 By: Smithee Insurance 4/22/2001 Introduced BACKGROUND AND PURPOSE Current law requires the commissioner of insurance (commissioner) to provide oversight and supervision of the activities of the board of directors (board) of each guaranty association but does not require the commissioner to be a member of the board. Providing oversight and supervision requires the commissioner to be familiar with the activities of the guaranty associations and to provide confidential information to each board regarding the solvency of the associations' member insurance companies. The commissioner may be able to provide more efficient oversight and supervision of the activities for the three guaranty associations if the commissioner is a member of the board of each association. In addition, current law does not provide a clear means of supplying solvency information to each guaranty association in a manner that protects the confidentiality of the information and may impede the commissioner's ability to provide information to a board that is important to the performance of the board's duties. House Bill 3013 adds the commissioner to the board of each guaranty association and exempts meetings held by the commissioner concerning solvency information from open meeting requirements. 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 3013 amends the Insurance and Government codes to modify provisions relating to the composition and operation of the board of directors of insurance guaranty associations. The bill amends the Insurance Code to add the commissioner of insurance (commissioner) to the board of directors (board) of the Texas Title Insurance Guaranty Association, the Texas Property and Casualty Insurance Guaranty Association, and the Life, Accident, Health, and Hospital Service Insurance Guaranty Association. The bill provides that the commissioner serves as an ex officio, nonvoting member of each board. The bill authorizes an appointed director of the Texas Title Insurance Guaranty Association to serve more than one term, rather than provides that a director is eligible to serve more than one term. The bill provides that the commissioner, rather than the State Board of Insurance, appoints members to the board of directors of the Texas Title Insurance Guaranty Association. The bill transfers from the State Board of Insurance to the Department of Insurance (department) duties regarding licensing and regulation of certain organizations. The bill amends the Government Code to transfer from the State Board of Insurance to the commissioner duties regarding meetings held by the commissioner concerning the solvency of a person regulated by the department. The bill authorizes the commissioner or a person designated by the commissioner to meet with the board of directors of a guaranty association in a closed meeting the subject of which relates to the commissioner's oversight of the guaranty association or to deliberate and determine the appropriate action to be taken concerning the solvency of a person regulated by the department. The bill also adds meetings held by the commissioner to oversee a guaranty association to the meetings which are not subject to open meeting requirements. EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001.