S.B. No. 833
  relating to consideration by insurers of certain prohibited
  criteria for ratemaking.
         SECTION 1.  Subtitle C, Title 5, Insurance Code, is amended
  by adding Chapter 565 to read as follows:
         Sec. 565.001.  PURPOSE. (a)  The purpose of this chapter is
  to regulate the use of environmental, social, or governance models,
  scores, factors, or standards to define acts or practices that may
  be unfair discrimination in the business of insurance in this
         (b)  The legislature finds that there are numerous entities
  that have developed different environmental, social, or governance
  models, scores, factors, or standards that are used to:
               (1)  evaluate financial risks for investments in
  certain businesses or industries; or
               (2)  encourage or discourage business dealings or
  investments with certain types of businesses or industries.
         (c)  To the extent that the use of such models, scores,
  factors, or standards are not based on sound actuarial principles,
  or do not bear a reasonable relationship to the expected loss and
  expense experience related to insurance risks, the rating of
  certain businesses or risks in this state without an ordinary
  insurance business purpose may adversely affect the economy, a
  sector of the economy, productivity, competition, jobs, the
  environment, or the public health and safety of this state or a
  portion of this state.
         Sec. 565.002.  DEFINITION. In this chapter, "insurer" means
  an insurance company or other entity authorized to engage in the
  business of insurance in this state.  The term includes:
               (1)  a stock or mutual property and casualty insurance
               (2)  a Lloyd's plan;
               (3)  a reciprocal or interinsurance exchange;
               (4)  a county mutual insurance company;
               (5)  a farm mutual insurance company;
               (6)  any insurer writing a line of insurance regulated
  by Title 10;
               (7)  all life, health, and accident insurance companies
  regulated by the department, including:
                     (A)  a stock or mutual life, health, or accident
  insurance company;
                     (B)  a fraternal benefit society;
                     (C)  a nonprofit hospital, medical, or dental
  service corporation, including a group hospital service
  corporation operating under Chapter 842; and
                     (D)  a stipulated premium company; and
               (8)  a health maintenance organization operating under
  Chapter 843.
         Sec. 565.003.  APPLICABILITY OF CHAPTER. (a) Except as
  provided by this section, this chapter applies only to insurance
  policies issued and delivered by an insurer in this state.
         (b)  This chapter does not require the filing of rates for
  any line, type of insurer, or type of insurance business that is not
  specifically required by statute to file rates with the department.
         (c)  This chapter does not apply to:
               (1)  fidelity, guaranty, and surety bonds; or
               (2)  crop insurance.
         Sec. 565.004.  CONSTRUCTION OF CHAPTER. (a)  This chapter
  shall be construed and applied to promote the underlying purposes
  as provided by Section 565.001.
         (b)  This chapter may not be construed or applied to require:
               (1)  an insurer to write any line or type of business
  that the insurer does not write; or
               (2)  a material change in the insurer's current
  business plans.
         (c)  Nothing in this chapter is intended to create any type
  of private cause of action or independent basis in a civil or
  criminal proceeding.
         (d)  Nothing in this chapter is intended to prohibit the use
  of information that is relevant and related to the risk being
  insured even if that information may also be used or considered in
  developing an environmental, social, or governance model, score,
  factor, or standard.
         Sec. 565.005.  PROHIBITED CRITERIA. Except as provided by
  Section 565.006, an insurer may not use an environmental, social,
  or governance model, score, factor, or standard to charge a rate
  different than the rate charged to another business or risk in the
  same class for essentially the same hazard.
         Sec. 565.006.  EXCEPTION. An insurer does not violate
  Section 565.005 if the insurer's actions are based on an ordinary
  insurance business purpose, including the use of sound actuarial
  principles, or financial solvency considerations reasonably
  related to loss experience for the different types of risks and
  coverages made available by a particular insurer.
         Sec. 565.007.  REGULATORY ACTION. Nothing in this chapter
  is intended to authorize the department to adopt any rule, model, or
  standard requiring an insurer to use any environmental, social, or
  governance model law, regulation, or other standard that has not
  been specifically authorized by statute, including:
               (1)  a rule, model, or standard required under any
  federal law that does not preempt state law under the
  McCarran-Ferguson Act (15 U.S.C. Section 1012(b)); or
               (2)  a rule, model, or standard required by any
  national organization, including the National Association of
  Insurance Commissioners, that has not been specifically authorized
  by statute.
         SECTION 2.  Chapter 565, Insurance Code, as added by this
  Act, applies only to an insurance policy that is delivered, issued
  for delivery, or renewed in this state on or after January 1, 2024.
         SECTION 3.  This Act takes effect September 1, 2023.
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
         I hereby certify that S.B. No. 833 passed the Senate on
  May 11, 2023, by the following vote:  Yeas 20, Nays 11.
  Secretary of the Senate    
         I hereby certify that S.B. No. 833 passed the House on
  May 24, 2023, by the following vote:  Yeas 86, Nays 54, one
  present not voting.
  Chief Clerk of the House