HBA-ATS S.B. 105 76(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 105
By: Harris
Insurance
3/10/1999
Engrossed



BACKGROUND AND PURPOSE 

The Insurance Code (code) requires every title insurance company, title
insurance agent, and direct operation to prepare an annual audit of trust
fund accounts and to submit it to the State Board of Insurance (board).
The code also prescribes the procedures that need to be followed and
establishes the deadline for submission of the audit.  S.B. 105 amends
these procedures by changing the office to which the annual audit report is
submitted from the State Board of Insurance to the Texas Department of
Insurance.  In addition, this bill establishes  a new deadline for
submitting the audit by changing the date from within ninety days from the
end of every title insurance agent's and direct operation's fiscal year to
before the 91st day after the end of the fiscal year.  This bill also
deletes the requirement that a title insurance company needs to perform an
analysis of its audit report for the board.  

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. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Article 9.39, Insurance Code, as follows:

(a) Requires an annual audit of trust fund accounts held by a title
insurance agent and direct operation to occur before the 91st day after,
rather than within 90 days from, the end of every title insurance agent's
and direct operation's fiscal year.  Requires the annual audit to be sent
to the Texas Department of Insurance (department), rather than the State
Board of Insurance (board).  Makes a nonsubstantive change.   

(b) Makes conforming changes.

(c) Requires the commissioner of insurance (commissioner), rather than the
board, to set forth the standards of the annual audit and the form of the
audit report.  

(d) Created from existing text.

(e) Deletes text requiring each title insurance company to examine and
analyze the audit reports created by its agents and direct operations, and
requiring each title insurance company to reports its findings of its
examination within three months.  Requires a title insurance company to
report to the department, rather than the board, by the 30th day after the
expiration of the 90-day period, the failure of its agents or direct
operations to deliver an audit report before the 91st day after the date,
rather than within three months, of the termination of the fiscal year of
the agent or direct operation.  Makes nonsubstantive changes. 

(f) Makes conforming changes.

(g) Makes a conforming change.

 (h) Requires those wronged by any action of the commissioner, rather than
the board, to have the right to appeal under Article 1.04 (Appeal of
Decision of Commissioner), rather than to file a suit under Article
9.37(Agent's Licenses: Surrender, Forfeiture; Grounds for Revocation;
Notice, Hearing and Appeal).   

SECTION 2.  Effective date: September 1, 1999.

SECTION 3.  Emergency clause.