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You are here: Home . rules . 2003 . 0226-059
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EXEMPT FILING NOTIFICATION PURSUANT TO THE INSURANCE CODE, CHAPTER 5, SUBCHAPTER L, ARTICLE 5.96

Notice is given that the Commissioner of Insurance will consider amendments proposed by the staff of the Workers´ Compensation Division of the Texas Department of Insurance to the Texas Basic Manual of Rules, Classifications and Experience Rating Plan for Workers' Compensation and Employers' Liability Insurance (the Manual>). The purpose of these proposed amendments to the Manual is to set forth guidelines for implementation of the Terrorism Insurance Act of 2002. Staff´s petition (Ref. No. W-0203-05-I) was filed on February 24, 2003.

A public hearing on this matter will not be held unless a separate request for a hearing is submitted to the Office of the Chief Clerk during the comment period as defined herein.

The staff´s proposed amendments to the Manual are filed pursuant to Texas Insurance Code Article 5.60 and 5.96. Article 5.60(b) requires the Commissioner of Insurance to adopt a uniform experience rating plan. Article 5.96 authorizes the Commissioner to prescribe, promulgate, adopt, approve, amend or repeal standard and uniform manual rules, rating plans, classification plans, statistical plans and policy and endorsement forms for workers´ compensation insurance.

The staff proposes amendments to the Manual as follows:

1. Amend Rule III E ­ Calculation of Total Estimated Policy Cost ­ Item 4 of the workers´ compensation policy to include the Terrorism Premium, if applicable, in the calculation of total estimated policy cost.

2. Amend Rule VI E Minimum Premium Number 5, Adjustment Upon Audit to indicate that if a policy is written on an "if any" basis, no Terrorism Premium will be charged unless the policy develops premium during the policy period or on audit.

3. Amend Rule VI I ­ Schedule Rating to provide that premium for the Terrorism Insurance Act of 2002 is not subject to schedule rating.

4. Amend Rule VI to add Section J ­ Terrorism Premium pursuant to the Terrorism Insurance Act of 2002 to provide that premium charged for losses covered under the Terrorism Insurance Act of 2002 is based on the policy´s total payroll as defined by Rule V B, Remuneration ­ Payroll. The amendment further describes how the Terrorism premium should be determined, states that Terrorism premium is not subject to modifications, states that Terrorism premium is not included in standard premium, states that if a policy is written on an "if any" basis, no Terrorism premium will be charged unless the policy develops premium during the policy period or at audit and states that Terrorism premium does not apply to Code 0913.

5. Amend Rule VII B Premium Discount Number 1 to indicate that Terrorism Premium is excluded from determination of the standard premium.

6. Amend Rule XV D Domestic Workers Residences Number 2c to indicate that Terrorism Premium does not apply to Code 0913.

7. Amend Rule XVII ­ Premium Incentives for Small Employers to Section F indicate that Terrorism Premium is not subject to the premium incentive for small employers.

8. Amend Procedures A ­ Policy Issuance Number 6 to include Terrorism premium, if applicable, as item to be indicated on the Information Page of the policy.

9. Renumber Section XIV ­ Forms Applicable for Use In Connection With the Experience Rating Plan of the Experience Rating Plan to Section XV to accommodate adding a new Section XIV.

10. Add new Section XIV ­ Terrorism Premium pursuant to the Terrorism Insurance Act of 2002 to the Experience Rating Plan to indicate that Terrorism Premium is not subject to experience rating.

The staff requests that the proposed amendments to the Texas Basic Manual of Rules, Classifications and Experience Rating Plan for Workers´ Compensation and Employers´ Liability Insurance as proposed herein be adopted effective 15 days after notice of adoption is published in the Texas Register.

The Commissioner has jurisdiction over this matter pursuant to the Insurance Code, Articles 5.60 and 5.96.

A copy of the full text of the proposed amendments is available for review in the Office of the Chief Clerk of the Texas Department of Insurance, 333 Guadalupe Street, Austin, Texas 78714-9104. For further information or to request copies of the amendments, please contact Ms. Angie Arizpe at (512) 463-6326 (refer to Ref. No. W-0203-05-I).

The staff and the Commissioner request that written comments to these proposed amendments be submitted no later than 5: 00 p.m. on April 7, 2003 to the Office of the Chief Clerk, Texas Department of Insurance, P. O. Box 149104, MC 113-2A, Austin, Texas 78714-9104. The written comments should be directed to Gene Jarmon, General Counsel and Chief Clerk, Texas Department of Insurance, P. O. Box 1249104, MC 113-2A, Austin, Texas 78714-9104. An additional copy of the comments should be simultaneously submitted to Nancy Moore, Deputy Commissioner, Workers´ Compensation, Texas Department of Insurance, P. O. Box 149104, MC 105-2A, Austin, Texas 78714-9104.



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