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.