| (a) Membership. The association is governed by Insurance
Code Chapter 2203. Any insurer authorized to write and engaged in
writing any insurance, the writing of which requires the insurer to
become a member of the association under Insurance Code §2203.055,
will become a member of the association on the first day of January
immediately following the date the insurer started writing such insurance.
The determination of the insurer's participation in the association
will be made as of the date of such membership in the same manner
as for all members of the association. Any member that ceases to be
authorized to write or that ceases to engage in the writing of any
insurance that would require such insurer to become a member of the
association will remain a member of the association until midnight
of December 31 next following the date the insurer ceases to be authorized
to write or ceases to write such insurance, and the insurer's participation
in the association will cease as of that time; provided, however,
that each member must participate in any financial deficit of the
association for all calendar years subsequent to December 31, 1976,
during which the insurer was a member of the association, whenever
such deficit is determined. The member must be charged or credited
in due course with its proper share of all expenses or losses and
any recoupment or reimbursement allocable to the member. If a member
is merged or consolidated with another insurer, the continuing insurer
will become a member of the association in place of the merged or
consolidated member, provided that such member will be deemed to have
become a member of the association on the date the merged or consolidated
member became a member and provided, further, that such member will
pay no initial expense fee.
(b) Expense fees.
(1) Initial expense fee. Each member must pay to the
association an initial expense fee of $100. All members of the association
must pay such fees on or before the date they become members of the
association.
(2) Annual expense fee. In addition to the initial
expense fee, each member must pay to the association an annual expense
fee in an amount to be determined by the board of directors and approved
by the Commissioner. All members of the association must pay such
annual expense fee on or before the first of January for each year
during which the association exists.
(3) Remedy for failure to pay fees. If any member fails
or refuses to pay either the initial expense fee or the annual expense
fee after receipt of written notice by the association that such fee
is due and payable, then such member will be subject to the same remedies
as provided in §5.2003(d)(4) of this title (relating to Property
and Casualty Insurance) for the failure of the member to pay any assessment
levied by the association.
(4) Use of fees. All expense fees paid to the association
will be used in such manner as the board of directors may from time
to time direct in accordance with this subchapter.
(c) Meetings of members.
(1) Notice of meetings. Written or printed notice stating
the place, date, hour, subjects of the meeting, and the purpose or
purposes for which the meeting is called, must be delivered not less
than 10 nor more than 50 days before the date of the meeting, either
personally or by mail, by or at the direction of the chair of the
board of directors, the secretary, or other person calling the meeting,
to each member entitled to vote at such meeting. Public notice of
meetings must be given as required by Government Code Chapter 551.
(2) Meetings.
(A) Annual meeting. The annual meeting of the members
must be held not later than the 30th day of September of each year
at an hour and place to be determined by the board of directors for
the purpose of electing directors and for the transaction of such
other business as may come before the meeting. If the election of
directors is not held on the day designated for any annual meeting
of the members, the board of directors must cause the election to
be held at a special meeting of the members as soon as may be convenient
after the annual meeting.
(B) Special meetings. The board of directors, the chair
of the board of directors, or 20% of the members may call a special
meeting of the members and designate any place as the place of the
special meeting.
(3) Quorum. Fifty members, represented by person or
by proxy, is a quorum at a meeting of the members. If fewer than 50
members are represented at a meeting, a majority of the members represented
may adjourn the meeting from time to time without further notice.
At the next meeting after adjournment at which a quorum is present
or represented, any business may be transacted at the meeting as originally
notified. The members represented at a duly organized meeting may
continue to transact business until adjournment, notwithstanding the
withdrawal of enough persons to leave less than a quorum.
(4) Voting.
(A) Each member is entitled to one vote at the annual
meeting and each special meeting.
(B) A member may vote by proxy executed in writing
by the member. No proxy will be valid after the next annual meeting
after the date of its execution unless otherwise provided in the proxy.
Each proxy is revocable.
(C) Each member's vote may be voted by such officer,
agent, or proxy as the bylaws of such member may authorize or, in
the absence of such authorization, as such member may determine.
(D) Voting on any question or in any election may be
by voice vote or by show of hands unless the presiding officer orders,
or any member demands, that voting be by written ballot.
(5) Rules. To the extent applicable, Robert's Rules
of Order govern the conduct of and procedure at all meetings of the
members.
(d) Directors.
(1) Selection. At each annual meeting of members or
as otherwise provided in subsection (c)(2) of this section, the members
must elect five directors from member companies for the categories
set forth in paragraph (2)(B) and (C) of this subsection. Four directors
must be selected in the manner set forth in paragraph (2)(D) - (F)
of this subsection. Directors take office on October 1 of each year
and will hold office until the next election of directors or until
a successor has been selected and qualified.
(2) Membership.
(A) The number of the directors of the association
must be nine.
(B) Three directors to be elected in accordance with
paragraph (1) of this subsection must be elected by the members and
be separate members of the association representing each of the following:
(i) the American Property Casualty Insurers Association;
(ii) the National Association of Mutual Insurance Companies;
and
(iii) the Insurance Council of Texas.
(C) Two directors must be elected by the members and
must be:
(i) a member insurer organized under the laws of and
domiciled in Texas; and
(ii) a member insurer that is either (or both):
(I) not a member of those associations described in
subparagraph (B) of this paragraph, or
(II) an insurer that is not domiciled in Texas.
(D) One director must be a physician who is appointed
by the Texas Medical Association or its successor.
(E) One director must be a representative of hospitals
appointed by the Texas Hospital Association or its successor.
(F) Two directors must be members of the public to
be appointed by the Commissioner.
(G) No director may fill more than one seat on the
board of directors, and no member affiliated by ownership, management,
or control may simultaneously occupy seats on the board of directors.
No later than 60 days before the annual meeting, the board of directors
must select a nominating committee of three member companies. The
three directors who will represent the organizations set forth in
subparagraph (B) of this paragraph must be nominated by the nominating
committee. The two directors described in subparagraph (C) of this
paragraph must be nominated by any member of the association by submitting
the nominee's name to the nominating committee. To be eligible for
selection to the board of directors by the members, a member must
be nominated at least 30 days before the annual meeting at which such
directors are selected.
(3) Term of office. Unless removed in accordance with
this subchapter, each director will hold office until the next election
of directors or until a successor has been selected and qualified.
(4) Regular meetings. A regular meeting of the board
of directors must be held with notice as provided for in this subsection,
immediately after and at the same place as the annual meeting of the
members. The board of directors may provide, by resolution, the time
and place for the holding of additional regular meetings with notice
to the directors at least 10 days before each regular meeting as provided
in this subsection.
Cont'd... |
