H.B. No. 526




AN ACT

relating to limits placed on coverage amounts of certain group life 
insurance policies or certificates.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 1131.455(a), (b), and (d), Insurance 
Code, are amended to read as follows:
	(a)  Except as otherwise provided by this section, the amount 
of insurance on a debtor's life under the policy may not exceed [the 
lesser of:
		[(1)]  the amount of the debtor's indebtedness[;
		[(2)  $50,000, if the indebtedness is not secured by a 
first lien on real estate; or
		[(3)  $125,000, if the indebtedness is secured by a 
first lien on real estate].
	(b)  Subject to Subsections (c) and (d), the face amount of 
any loan or loan commitment, totally or partially executed, made to 
a debtor for educational purposes or to a debtor with seasonal 
income by a creditor in good faith for general agricultural or 
horticultural purposes, secured or unsecured, under which the 
debtor becomes personally liable for the payment of the loan, may be 
insured in an initial amount of insurance not to exceed [the lesser 
of:
		[(1)]  the total amount payable under the contract of 
indebtedness[; or
		[(2)  $100,000 on any one life].                             
	(d)  Insurance on a loan commitment described by Subsection 
(b) that does not exceed one year in duration may be written up to 
the amount of the loan commitment on a nondecreasing or level term 
plan [but may not exceed $100,000 on any one life].
	SECTION 2.  The following laws are repealed:                                   
		(1)  Sections 1131.205(b)-(d), Insurance Code;                                
		(2)  Sections 1131.255(b)-(d), Insurance Code;                                
		(3)  Section 1131.405(b), Insurance Code;                                     
		(4)  Section 1131.754, Insurance Code; and                                    
		(5)  Section 1131.755(b), Insurance Code.                                     
	SECTION 3.  The changes in law made by this Act apply only to 
a group life insurance policy or certificate that is delivered, 
issued for delivery, or renewed on or after the effective date of 
this Act.  A group life insurance policy or certificate that is 
delivered, issued for delivery, or renewed before the effective 
date of this Act is covered by the law in effect at the time the 
policy or certificate was delivered, issued for delivery, or 
renewed, and that law is continued in effect for that purpose.
	SECTION 4.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2005.




______________________________              ______________________________
 
   President of the Senate                               Speaker of the House      

	I certify that H.B. No. 526 was passed by the House on April 
22, 2005, by the following vote:  Yeas 143, Nays 0, 2 present, not 
voting.

                                                  ______________________________
                                                     Chief Clerk of the House   

	I certify that H.B. No. 526 was passed by the Senate on May 
19, 2005, by the following vote:  Yeas 31, Nays 0.

                                                  ______________________________
                                                     Secretary of the Senate    



APPROVED:  _____________________                                            
 
                   Date                                                      




 
          _____________________                                          
 
                 Governor