28 TAC §7.401
1. INTRODUCTION. The Texas Department of Insurance proposes the repeal of §7.401 concerning the minimum risk-based capital and surplus requirements for life, accident and health insurers. The repeal is necessary to eliminate unnecessary provisions and to allow the Texas Department of Insurance simultaneously to adopt new §7.401 which replaces the repealed section with a new risk-based capital formula. Notification of the proposed new section appears elsewhere in this issue of the Texas Register.
2. FISCAL NOTE. Ms. Betty Patterson, Senior Associate Commissioner, Financial Program, has determined that, for the first five years the repeal is in effect, there will be no fiscal implications for state or local government as a result of this repeal and there will be no measurable effect on local employment or local economy.
3. PUBLIC BENEFIT/COST NOTE. Ms. Patterson has also determined that, for each year of the first five years this repeal is in effect, the repeal will provide for the efficient regulation of insurance. There will be no additional costs for those companies who must comply with the repeal. Regardless of the fiscal effects and considering the purpose of the underlying state statutes, it is neither legal nor feasible to waive or modify this proposed repeal for micro or small business as the solvency of an insurer must be measured fairly and objectively, regardless of the size of the insurer and doing so would result in a disparate effect on policyholders and other persons affected by these rules.
4. REQUEST FOR PUBLIC COMMENT. To be considered, all comments on the proposal must be received in writing no later than 5:00 p.m. on November 13, 2000. All comments should be submitted to Lynda H. Nesenholtz, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comments should be simultaneously submitted to Betty Patterson, Senior Associate Commissioner - Financial Program, Mail Code 305-2A, P. O. Box 149104, Austin, Texas 78714-9104. Any requests for a public hearing should be submitted separately to the Office of the Chief Clerk.
5. STATUTORY AUTHORITY. The repeal of the section is proposed under the Insurance Code Articles 3.02 and 22.13 and §36.001. Article 3.02 authorizes the commissioner to issue rules designed to ensure the financial solvency of companies for the protection of policyholders. Article 22.13 authorizes the commissioner to adopt rules regarding the minimum capital and surplus for certain insurers. Section 36.001 authorizes the commissioner to adopt rules for the conduct and execution of the duties and sanctions of the department.
6. CROSS REFERENCE TO STATUTE. The following statutes are affected by this proposal: Insurance Code Articles 1.32, 3.02, 22.13.
7. TEXT.
§7.401. Minimum Risk-Based Capital and Surplus Requirements for Life, Accident, and Health Insurers.