HBA-MSH, NRS C.S.H.B. 845 77(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 845
By: Nixon, Joe
Insurance
3/19/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Prior to and during the Holocaust, insurance companies sold policies to
individuals who subsequently became victims of the Holocaust.  Many of
these policies were lost or destroyed and still remain unpaid. Holocaust
survivors and their heirs, successors, assignees, or beneficiaries have
attempted to collect on these policies; however, the limitation period has
expired.  C.S.H.B. 845 allows an action to be brought against an insurer to
recover on a claim arising out of an insurance policy issued to a Holocaust
victim and provides penalties for insurers that deny a claim because of the
age of the claim. 

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. 845 amends the Insurance Code to authorize a Holocaust victim, or
the heir, beneficiary, assignee, or successor of a Holocaust victim who
resides in this state and has a claim arising out of an insurance policy
purchased or in effect in Europe before 1946 that was delivered, issued for
delivery, or renewed by an insurer to bring an action against an insurer
engaged in the business of insurance in this state to recover on that claim
in a court of competent jurisdiction in this state.  "Holocaust victim"
means a person who was killed or injured, or who lost real or personal
property or financial assets as the result of discriminatory laws,
policies, or actions directed against any discrete group of which the
person was a member during the period of 1920 to 1945, inclusive, in
Germany, areas occupied by Germany, or countries allied with Germany. The
bill prohibits the dismissal of such an action for failure to comply with
any applicable limitations period if the action is brought before December
31, 2012.  Failure by an insurer to comply with such a claim by denying the
claim on the grounds that it was not timely or by asserting a statute of
limitations constitutes a violation.  The bill authorizes the commissioner
of insurance, after notice and hearing, to impose an administrative penalty
or direct the insurer to make restitution, refer the matter to the attorney
general, initiate an examination to determine the fitness of the insurer to
continue to engage in the business of insurance in this state initiate a
proceeding to suspend or revoke the insurer's certificate of authority, or
pursue and other action the commissioner determines to be appropriate.
These provisions expire January 1, 2013. 

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. 845 adds provisions to the original relating to the penalties
applicable to an insurer that denies a Holocaust era claim on the grounds
that the claim is not timely or by asserting a statute of limitations.  The
substitute expands the definition of "insurer" to include any parent
company, subsidiary, or affiliated company, at least 50 percent of the
stock of which is in common ownership with an insurer engaged in the
business of insurance in Texas.  The substitute expands the definition of
"insurance policy" to include reinsurance on a covered risk.  The
substitute adds an assignee or successor of a Holocaust victim to the list
of those who are authorized to bring a claim against an insurer.  The
substitute specifies that the provisions expire in 2013, rather than 2011,
as in the original.  The substitute changes the time period within the
definition of "Holocaust victim" from between 1929 and 1945 to between 1920
and 1945.