1. INTRODUCTION. The Commissioner of Insurance adopts an amendment to §25.88 concerning an assessment which will be used to cover the general administrative expenses of the department's regulation of insurance premium finance companies. The amended section is adopted without changes to the proposed text published in the November 25, 2005 issue of the Texas Register (30 TexReg 7809).
2. REASONED JUSTIFICATION. The amendment is necessary to adjust the rate of assessment to ensure that there are sufficient funds to meet the expenses of performing the department's statutory responsibilities for examining, investigating, and regulating insurance premium finance companies.
3. HOW THE SECTION WILL FUNCTION. Under §25.88, the department levies a rate of assessment to cover the department's general administrative expenses for fiscal year 2006 and collects the assessment from each insurance premium finance company on the basis of a percentage of the company's total loan dollar volume for the 2005 calendar year. The department estimates that the assessment will yield $153,126 for the state's general revenue fund.
4. SUMMARY OF COMMENTS. The department did not receive any comments on the proposal.
5. STATUTORY AUTHORITY. The amendment is adopted under the Insurance Code §§651.003, 651.006(a)(2), and 36.001. Section 651.003 authorizes the Commissioner to adopt and enforce rules necessary to carry out the provisions of the Insurance Code, Title 5, Chapter 651, concerning the regulation of insurance premium finance companies. Section 651.006 requires each insurance premium finance company licensed by the department to pay an amount imposed by the department to cover the direct and indirect costs of examinations and investigations and a proportionate share of general administrative expenses attributable to regulation of insurance premium finance companies. Section 36.001 provides that the Commissioner may adopt any rules necessary and appropriate to implement the powers and duties of the department under the Insurance Code and other laws of this state.
6. TEXT.
§25.88. General Administrative Expense Assessment. On or before April 1, 2006, each insurance premium finance company holding a license issued by the department under the Insurance Code, Chapter 651, shall pay an assessment to cover the general administrative expenses attributable to the regulation of insurance premium finance companies. Payment shall be sent to the Texas Department of Insurance, Examinations Division, Mail Code #305-2E, 333 Guadalupe, P. O. Box 149104 , Austin , Texas 78701-9104 . The assessment to cover general administrative expenses shall be computed and paid as follows.
(1) The amount of the assessment shall be computed as .00337 of 1.0% of the total loan dollar volume of the company for calendar year 2005.
(2) If the amount of the assessment computed under paragraph (1) of this section is less than $250, the amount of the assessment shall be $250.