S.B.
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No.
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1431AN ACTrelating to the functions of insurance holding company systems.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:SECTION
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1.
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Section 823.002, Insurance Code, is amended byadding Subdivisions (3-a), (3-b), and (4-a) and amendingSubdivision (6) to read as follows:(3-a)
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"Divesting person" means a person who hascontrol of a domestic insurer and who intends to divest control ofthe domestic insurer.(3-b)
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"Divestiture" means an abandonment of control ofa domestic insurer by a divesting person that does not result in thetransfer of control to another person.(4-a)
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"Enterprise risk" means any activity,circumstance, event, or series of events involving one or moreaffiliates of an insurer that, if not remedied promptly, is likelyto have a material adverse effect on the financial condition orliquidity of the insurer or its insurance holding company system asa whole, including anything:(A)
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that would cause the insurer
’
s risk-basedcapital to fall into company action level; or(B)
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that would cause the insurer to be inhazardous financial condition.(6)
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"Insurer" means any insurance company organizedunder the laws of this state, a commercially domiciled insurer, or1234567891011121314151617181920212223241
an insurer authorized to engage in the business of insurance in thisstate. The term includes a capital stock company, mutual company,farm mutual insurance company, title insurance company, fraternalbenefit society, local mutual aid association, statewide mutualassessment company, county mutual insurance company, Lloyd
’
s plan,reciprocal or interinsurance exchange, stipulated premiuminsurance company, and group hospital service corporation. Theterm does not include an agency, authority, or instrumentality ofthe United States, its possessions and territories, theCommonwealth of Puerto Rico, the District of Columbia, or a state[,or an agency, authority, instrumentality,] or politicalsubdivision of a state.SECTION
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2.
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Section 823.010, Insurance Code, is amended byamending Subsections (c) and (d) and adding Subsections (e) through(h) to read as follows:(c)
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Except as provided by Subsection (d), [After] thedisclaimer shall be deemed to have been allowed unless, not laterthan 60 days after the receipt of a complete disclaimer, [is filed:[(1)
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the insurer is not required to register or reportunder Subchapter B because of a duty that arises out of theinsurer
’
s relationship with the person unless] the commissionernotifies the filing party that [disallows] the disclaimer isdisallowed[, in which event the duty to register or report begins onthe date of the disallowance; and[(2)
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the person is not required to comply withSections 823.154, 823.155, 823.159, and 823.160 unless thecommissioner disallows the disclaimer].123456789101112131415161718192021222324252627S.B.
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No.
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14312
(d)
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Notwithstanding Subsection (c), if the commissioner atany time determines that the information disclosed in thedisclaimer is incomplete or inaccurate or is no longer accurate,the [The] commissioner may disallow the disclaimer [only after:[(1)
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providing to each party in interest notice of andthe opportunity to be heard on the disallowance; and[(2)
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making specific findings of fact to support thedisallowance].(e)
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If the commissioner disallows a disclaimer, the partywho filed the disclaimer may request an administrative hearing.The commissioner shall grant the request for the hearing.(f)
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Except as provided by Subsection (h), if thecommissioner allows a disclaimer:(1)
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the insurer is not required to register or reportunder Subchapter B due to a duty arising from the insurer
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srelationship with the party who filed the disclaimer; and(2)
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the party who filed the disclaimer is not requiredto comply with Section 823.154, 823.155, 823.159, or 823.160.(g)
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If the commissioner allows a disclaimer, thecommissioner at the same time may also waive another provision ofthis chapter with relation to the party who filed the disclaimer.The commissioner may require reasonable controls and safeguardsthat are consistent with the purposes of this chapter in granting awaiver under this subsection.(h)
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If the commissioner disallows a disclaimer underSubsection (d):(1)
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effective on the date of the disallowance, the123456789101112131415161718192021222324252627S.B.
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No.
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14313
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