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AN ACT
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relating to compensatory payments and reinsurance agreements made |
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in connection with the issuance of title insurance. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter B, Chapter 2502, Insurance Code, is |
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amended by adding Section 2502.057 to read as follows: |
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Sec. 2502.057. CERTAIN COMPENSATORY PAYMENTS RELATED TO |
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CERTAIN ELECTRIC ENERGY PROJECTS PERMITTED. (a) This section |
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applies with respect to a utility project that is: |
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(1) designed to produce, generate, transmit, |
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distribute, sell, or furnish electric energy; and |
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(2) valued on completion at more than $25 million. |
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(b) A payment for furnishing title evidence for the issuance |
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of a title insurance policy related to a project described by |
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Subsection (a) may be: |
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(1) a flat fee or fee calculated on an hourly basis |
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that: |
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(A) is payable on the date the title evidence is |
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furnished; and |
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(B) does not exceed $25,000; or |
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(2) a portion of the title insurance premium: |
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(A) based on the percentage established by the |
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commissioner for payment by a title insurance company, title |
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insurance agent, or direct operation for services performed by |
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another title insurance company, title insurance agent, or direct |
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operation; and |
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(B) payable on the date of the issuance of the |
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policy for which the evidence is furnished. |
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(c) The payment must be: |
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(1) made by the proposed insured to the title |
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insurance company, title insurance agent, or direct operation that |
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furnishes the title evidence; and |
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(2) credited against the title insurance premium |
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charged for the issuance of the title insurance policy for which the |
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evidence is furnished. |
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(d) Nothing in this section may be construed to allow the |
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payment of an amount in violation of the premium rates promulgated |
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or the division of premium established by the commissioner. |
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(e) This section does not apply to a payment to a reinsurer |
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for the assumption of reinsurance described by Subchapter G, |
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Chapter 2551. |
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SECTION 2. Section 2551.305, Insurance Code, is amended by |
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adding Subsection (e) to read as follows: |
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(e) Notwithstanding any other provision of this subchapter, |
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a title insurance company may obtain reinsurance by a reinsurance |
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treaty or other reinsurance agreement from an assuming insurer with |
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a financial strength rating of B+ or better from the A. M. Best |
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Company that meets the requirements of Subchapter C, Chapter 493, |
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if the title insurance company has provided the department with an |
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affidavit that: |
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(1) contains facts that demonstrate the title |
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insurance company was unable after diligent effort to procure |
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sufficient reinsurance from another title insurance company; and |
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(2) states the terms of the reinsurance treaty or |
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other reinsurance agreement that the title insurance company will |
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obtain. |
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SECTION 3. The change in law made by Section 2502.057, |
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Insurance Code, as added by this Act, applies only to a payment for |
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title evidence furnished on or after the effective date of this Act. |
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A payment for title evidence furnished before the effective date of |
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this Act is governed by the law as it existed immediately before the |
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effective date of this Act, and that law is continued in effect for |
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that purpose. |
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SECTION 4. The change in law made by Section 2551.305(e), |
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Insurance Code, as added by this Act, applies only to reinsurance |
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obtained on or after the effective date of this Act. Reinsurance |
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obtained before the effective date of this Act is governed by the |
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law as it existed immediately before the effective date of this Act, |
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and that law is continued in effect for that purpose. |
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SECTION 5. This Act takes effect September 1, 2013. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I certify that H.B. No. 3106 was passed by the House on May 2, |
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2013, by the following vote: Yeas 147, Nays 0, 2 present, not |
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voting; that the House refused to concur in Senate amendments to |
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H.B. No. 3106 on May 22, 2013, and requested the appointment of a |
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conference committee to consider the differences between the two |
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houses; and that the House adopted the conference committee report |
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on H.B. No. 3106 on May 26, 2013, by the following vote: Yeas 146, |
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Nays 0, 2 present, not voting. |
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______________________________ |
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Chief Clerk of the House |
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I certify that H.B. No. 3106 was passed by the Senate, with |
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amendments, on May 20, 2013, by the following vote: Yeas 30, Nays |
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0, 1 present, not voting |
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; at the request of the House, the Senate |
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appointed a conference committee to consider the differences |
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between the two houses; and that the Senate adopted the conference |
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committee report on H.B. No. 3106 on May 26, 2013, by the following |
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vote: Yeas 30, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: __________________ |
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Date |
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__________________ |
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Governor |