HBA-ATS S.B. 1610 76(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 1610
By: Lucio
Insurance
4/24/1999
Engrossed



BACKGROUND AND PURPOSE 

Compressed air foam (CAF) technology is being used within Texas as a safer,
more efficient means for fire suppression activities.  Among its
advantages, CAF minimizes water damages and protects exposures.  Moreover,
CAF technology aids in precise and extended projection of dry chemical
solution to the source of the fire, thereby extinguishing the fire more
rapidly.  S.B. 1610  requires the use of compressed air foam technology in
fire-fighting equipment to constitute a reduction in hazard by the
insurance policy holder or holders.  In addition, this bill includes other
political subdivisions among the governmental entities to which the
commissioner of insurance is authorized to give credit for each and every
hazard these entities may reduce or entirely remove, and also for all added
fire-fighting equipment, increased police protection, and any other
equipment or improvement that has a tendency to reduce the fire hazard.   

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 5.33, Insurance Code, as follows:

Art.  5.33.  New title: CREDIT FOR REDUCING HAZARD.  (a) Includes other
political subdivisions among the governmental entities to which the
commissioner of insurance (commissioner) is authorized, rather than to
which the State Board of Insurance (board) is required to have full
authority and power, to give credit for each and every hazard these
entities may reduce or entirely remove, and also for all added fire
fighting equipment, increased police protection, and any other equipment or
improvement that has a tendency to reduce the fire hazard.  Makes
conforming changes.  

(b) Authorizes the commissioner, rather than requires the board, to compel
any company to give any or all policy holders credit for any and all
hazards said policy holder or holders may reduce or remove. 

(c) Includes the use of compressed air foam technology in fire-fighting
equipment, in addition to the installation of a new standard fire hydrant
approved by the Texas Department of Insurance (department), rather than the
board, as activities required to constitute a reduction in hazard by the
insurance policy holder or holders.  Makes conforming and nonsubstantive
changes. 

(d) Creates this subsection from existing text.

SECTION 2.Makes application of this Act prospective for an insurance policy
delivered, issued for delivery, or renewed on or after January 1, 2000. 

SECTION 3.Effective date: September 1, 1999.

SECTION 4.Emergency clause.