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You are here: Home . rules . 2002 . industryratecases
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Subchapter L. RULES OF PRACTICE AND PROCEDURE FOR INDUSTRY-WIDE RATE CASES

1. INTRODUCTION. The Texas Department of Insurance proposes repeal of Subchapter L, §§1.1301 ­ 1.1317 concerning the rules of practice and procedure for industry-wide rate cases. Repeal of this subchapter is necessary because the procedures contained in this subchapter are inconsistent with the provisions of House Bills 2102, 1162, and 2159 enacted by the 77 th Legislature. House Bill 2102 amends the Texas Insurance Code, Article 5.101 §3(d) by changing the procedure for promulgating state-wide benchmark rates and amends the Texas Insurance Code Article 21.81 by changing the procedure for determining rates for the Texas Automobile Insurance Plan Association. House Bill 1162 amends the Texas Insurance Code Article 21.49 by changing the procedure for determining rates for personal risks written by the Texas Windstorm Insurance Association (formerly known as the Texas Catastrophe Insurance Pool). House Bill 2159 amends the Texas Insurance Code Article 3.53 by changing the procedure for determining the presumptive rates for credit life and credit accident and health insurance. Simultaneous to this proposed repeal, proposed new Subchapter L, §§1.1301­1.1306 are published elsewhere in this issue of the Texas Register. The purpose of the proposed new Subchapter L, §§1.1301­1.1306 is to provide rules governing the proceedings to promulgate industry-wide benchmark rates under the Texas Insurance Code Art. 5.101 §3(d).

2. FISCAL NOTE. C. H. Mah, Senior Associate Commissioner of the Property and Casualty Division, has determined that during the first five years that the proposed repeal is in effect, there will be no fiscal impact on state or local government as a result of enforcing or administering the sections. There will be no measurable effect on local employment or the local economy as a result of the proposal.

3. PUBLIC BENEFIT/COST NOTE. C. H. Mah, Senior Associate Commissioner of the Property and Casualty Division, has also determined that for each year of the first five years the repeal is in effect, the public benefit anticipated as a result of administration and enforcement of the repealed sections will be the elimination of possible confusion resulting from rules inconsistent with statutory law. There is no anticipated economic cost to persons who are required to comply with the proposed repeal. There is no anticipated difference in cost of compliance between small and large businesses.

4. REQUEST FOR PUBLIC COMMENT. To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on August 19, 2002 to Lynda H. Nesenholtz, General Counsel and Chief Clerk, Mail Code 113-1C, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comment must be simultaneously submitted to C. H. Mah, Senior Associate Commissioner of the Property and Casualty Division, Mail Code 105-5G, Texas Department of Insurance, P.O. Box 149104, Austin, Texas, 78714-9104. A request for a public hearing must be submitted separately to the Office of Chief Clerk.

5. STATUTORY AUTHORITY. Repeal of §§1.1301 - 1.1317 is proposed pursuant to the Insurance Code, Articles 5.101§3(d), 21.81, 21.49, 3.53, and §§36.001, 37.001, and 40.061. Article 5.101§3(d), as amended by H.B. 2102, changes the procedure for promulgating industry-wide benchmark rates from contested case proceedings to rulemaking proceedings. Article 21.81, as amended by H.B. 2102, changes the procedure for promulgating rates for the Texas Automobile Insurance Plan Association from a contested case proceeding to a manual rate filing to be approved, disapproved or modified by the Commissioner. Article 21.49, as amended by H. B. 1162, changes the procedure for determining rates for personal risks written by the Texas Windstorm Insurance Association from a contested case proceeding conducted as part of the residential property benchmark rate case to a manual rate filing to be approved, disapproved or modified by the Commissioner. Article 3.53, as amended by H.B. 2159, changes the procedure for determining the presumptive rates for credit life and credit accident and health insurance from a contested case proceeding to a rulemaking proceeding. Section 36.001 provides that the Commissioner of Insurance may adopt rules and regulations to execute the duties and functions of the Texas Department of Insurance only as authorized by statute. Section 37.001 requires the Commissioner to adopt rules governing proceedings necessary to approve or promulgate rates under the Texas Insurance Code and any other insurance law of this state. Section 40.061 provides that all hearings for benchmark rates for all lines subject to Article 5.101 are conducted as provided by section 3(d) of that article.

6. CROSS REFERENCE TO STATUTE. The proposed repeal affects regulation pursuant to the following statutes:

Texas Insurance Code, Articles 5.101, 21.81, 21.49, and 3.53; and §§ 37.001, 40.002, 40.003, and 40.051-40.061.

7. TEXT.

§1.1301. Scope.

§1.1302. Definitions.

§1.1303. Construction.

§1.1304. Notice of Hearing.

§1.1305. Pleadings.

§1.1306. Intervention.

§1.1307. Filing and Service.

§1.1308. Prehearing Conferences.

§1.1309. Pre-filed Testimony and Exhibits.

§1.1310. Discovery.

§1.1311. Agreements to Be in Writing.

§1.1312. Prehearing Rulings.

§1.1313. Order of Presentation and Cross-examination.

§1.1314. Alignment of Participants.

§1.1315. Presentation of Evidence.

§1.1316. Exhibits.

§1.1317. Post-hearing Procedures.

8. CERTIFICATION. This agency hereby certifies that the proposed repeal of 28 TAC §§ 1.1301­1.1317 has been reviewed by legal counsel and found to be within the agency's authority to adopt.



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