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  H.B. No. 1294
 
 
 
 
AN ACT
  relating to certain certifications, professional designations, and
  education requirements regarding the sale of life insurance and
  annuities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
  ARTICLE 1. AGENT EDUCATION REQUIREMENTS
         SECTION 1.001.  Subchapter B, Chapter 1115, Insurance Code,
  is amended by adding Section 1115.056 to read as follows:
         Sec. 1115.056.  AGENT EDUCATION REQUIREMENTS. (a) A
  resident agent that intends to sell, solicit, or negotiate a
  contract for an annuity in this state or to represent an insurer in
  relation to such an annuity must submit evidence satisfactory to
  the department of completion of at least four hours of training
  relating to annuities before soliciting individual consumers for
  the purpose of selling annuities.
         (b)  The training required under Subsection (a) may be used
  to satisfy the continuing education requirements imposed under this
  code and rules adopted under this code for issuance of a license
  under this code.
         SECTION 1.002.  Chapter 4004, Insurance Code, is amended by
  adding Subchapter E to read as follows:
  SUBCHAPTER E. CONTINUING EDUCATION REQUIREMENTS FOR SALE OF
  ANNUITIES
         Sec. 4004.201.  DEFINITION. In this subchapter, "annuity"
  has the meaning assigned by Section 1115.002.
         Sec. 4004.202.  REQUIRED CONTINUING EDUCATION REGARDING
  ANNUITIES. (a) This section applies to a resident agent who:
               (1)  sells, solicits, or negotiates a contract for an
  annuity in this state; or
               (2)  represents or purports to represent an insurer in
  relation to such an annuity.
         (b)  Each agent described by Subsection (a) must complete
  four hours of continuing education annually that specifically
  relates to annuities. The annual period under this section must be
  based on the agent's license expiration date or another date
  specified by the commissioner by rule, and the education
  requirement under this subsection must be met within that annual
  period, notwithstanding Section 4004.051(b).
         (c)  The continuing education required under this section
  may be used to satisfy the continuing education requirements under
  Subchapter B.
         Sec. 4004.203.  PROGRAM CERTIFICATION REQUIREMENTS. (a)
  The commissioner by rule shall adopt criteria for continuing
  education programs used to satisfy the requirements of Section
  4004.202. Those criteria must include:
               (1)  topics related specifically to annuities;
               (2)  state laws and rules related to annuities,
  including requirements adopted under Chapter 1115;
               (3)  prohibited sales practices regarding annuities;
               (4)  recognition of indicators that a prospective
  insured may lack the short-term memory or judgment to knowingly
  purchase an annuity; and
               (5)  fraudulent and unfair trade practices regarding
  the sale of annuities.
         (b)  Subject matter determined by the commissioner to be
  primarily intended to promote the sale or marketing of annuities
  does not qualify as continuing education for purposes of this
  subchapter.
         (c)  Subchapter C applies to continuing education programs
  described by Subsection (a) and training under Section 1115.056.
  Any training program disapproved under Subsection (b) shall be
  presumed invalid for certification under Subchapter C unless the
  program is approved in writing by the commissioner.
         SECTION 1.003.  The commissioner of insurance shall adopt
  rules as required by Section 4004.203, Insurance Code, as added by
  this article, not later than December 1, 2009.
         SECTION 1.004.  Subchapter E, Chapter 4004, Insurance Code,
  as added by this article, applies to continuing education
  requirements for insurance agents for a license issued or renewed
  on or after April 1, 2010.
         SECTION 1.005.  Section 1115.056, Insurance Code, as added
  by this article, applies to training requirements for insurance
  agents for a license issued or renewed on or after April 1, 2010.
  ARTICLE 2. USE OF SENIOR-SPECIFIC CERTIFICATIONS OR
  PROFESSIONAL DESIGNATIONS
         SECTION 2.001.  Subtitle A, Title 7, Insurance Code, is
  amended by adding Chapter 1117 to read as follows:
  CHAPTER 1117.  USE OF SENIOR-SPECIFIC CERTIFICATIONS OR
  PROFESSIONAL DESIGNATIONS
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 1117.001.  PURPOSE. The purpose of this chapter is to
  establish standards to protect consumers from misleading and
  fraudulent marketing practices with respect to the use of certain
  senior-specific certifications and professional designations in
  soliciting the sale or purchase of, or providing advice made
  concerning, life insurance or annuity products.
         Sec. 1117.002.  DEFINITIONS. In this chapter:
               (1)  "Insurance agent" means an agent licensed under
  this code to sell, solicit the sale of, or negotiate a life
  insurance or annuity product.
               (2)  "Senior-specific certification or professional
  designation" means a certification or designation that implies that
  an insurance agent holds a special certification or has specialized
  training in advising or servicing seniors regarding purchasing or
  selling a life insurance or annuity product.
         Sec. 1117.003.  APPLICABILITY OF CHAPTER; CONSTRUCTION WITH
  OTHER LAW. (a) This chapter applies to any solicitation, sale or
  purchase of, or advice made in connection with, a life insurance or
  annuity product by an insurance agent.
         (b)  Nothing in this chapter may be construed to limit the
  commissioner's authority to enforce any other provision of this
  code or another law.
  [Sections 1117.004-1117.050 reserved for expansion]
  SUBCHAPTER B. USE OF SENIOR-SPECIFIC CERTIFICATIONS AND
  PROFESSIONAL DESIGNATIONS
         Sec. 1117.051.  CERTAIN USES OF SENIOR-SPECIFIC
  CERTIFICATIONS AND DESIGNATIONS PROHIBITED.  (a) An insurance
  agent may not, directly or indirectly, use a senior-specific
  certification or professional designation in such a way as to
  mislead a purchaser or prospective purchaser that the agent has
  special certification or training in advising or servicing seniors
  in connection with the solicitation, sale, or purchase of a life
  insurance or annuity product or in the provision of advice as to the
  value of or the advisability of purchasing or selling a life
  insurance or annuity product:
               (1)  through any writing or other publication; or
               (2)  by issuing or disseminating analyses or reports
  related to a life insurance or annuity product.
         (b)  Subsection (a) prohibits the use of a senior-specific
  certification or professional designation only by an insurance
  agent using:
               (1)  a certification or professional designation that
  the agent has not actually earned or for which the agent is
  ineligible;
               (2)  a nonexistent or self-conferred certification or
  professional designation;
               (3)  a certification or professional designation that
  indicates or implies a level of occupational qualification obtained
  through education, training, or experience that the agent has not
  obtained; and
               (4)  a certification or professional designation that
  was obtained from an organization that:
                     (A)  is primarily engaged in the business of
  instruction in sales or marketing;
                     (B)  does not have reasonable standards or
  procedures for:
                           (i)  assuring the competency of individuals
  granted a certification or designation by the organization; or
                           (ii)  monitoring and disciplining
  individuals granted a certification or designation by the
  organization for improper or unethical conduct; or
                     (C)  does not have reasonable continuing
  education requirements in order to maintain the certification or
  designation for individuals granted a certification or designation
  by the organization.
         (c)  A rebuttable presumption exists that a certification or
  professional designation granted by an organization described by
  Subsection (b)(4) is not prohibited under Subsection (a) if the
  certification or designation issued by the organization does not
  primarily apply to sales or marketing and if the organization or the
  certification or designation has been accredited by:
               (1)  the American National Standards Institute;
               (2)  the National Commission for Certifying Agencies;
               (3)  any organization that is included in "Accrediting
  Agencies Recognized for Title IV Purposes" published by the U.S.
  Department of Education; or
               (4)  any other national accrediting organization
  recognized by the commissioner.
         (d)  In determining whether a word, a combination of words,
  or an acronym constitutes a senior-specific certification or
  professional designation, the commissioner shall consider:
               (1)  the use of one or more words such as "senior,"
  "retirement," "elder," or similar words combined with one or more
  words such as "certified," "registered," "chartered," "advisor,"
  "specialist," "consultant," "planner," or similar words, in the
  name of the certification or professional designation; and
               (2)  the manner in which those words are combined.
         Sec. 1117.052.  APPLICABILITY TO CERTAIN FINANCIAL
  SERVICES. (a)  Notwithstanding Section 1117.003, for purposes of
  this chapter, a job title used within an organization that is
  licensed or registered by a state or federal financial services
  regulatory agency and that indicates seniority or standing within
  the organization, or that specifies an individual's area of
  specialization within the organization, is not a senior-specific
  certification or professional designation unless the title is used
  in a manner that is likely to confuse or mislead a reasonable
  consumer.
         (b)  For purposes of Subsection (a), "financial services
  regulatory agency" includes an agency that regulates insurers,
  insurance producers, broker-dealers, investment advisers, or
  investment companies, as defined by the Investment Company Act of
  1940 (15 U.S.C. Section 80a-1 et seq.).
         SECTION 2.002.  The change in law made by this article
  applies only to the solicitation of, sale of, or advice made in
  connection with, a life insurance or annuity product by an
  insurance agent on or after January 1, 2010. The solicitation of,
  sale of, or advice made in connection with, a life insurance or
  annuity product by an insurance agent before January 1, 2010, is
  covered by the law in effect at the time the solicitation or sale
  was made or the advice was given, and that law is continued in
  effect for that purpose.
  ARTICLE 3. EFFECTIVE DATE
         SECTION 3.001.  This Act takes effect September 1, 2009.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 1294 was passed by the House on April
  28, 2009, by the following vote:  Yeas 149, Nays 0, 1 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 1294 on May 23, 2009, by the following vote:  Yeas 137, Nays 0,
  1 present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 1294 was passed by the Senate, with
  amendments, on May 21, 2009, by the following vote:  Yeas 31, Nays
  0.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor