TITLE 28.INSURANCE

Part 1. TEXAS DEPARTMENT OF INSURANCE

Chapter 1. GENERAL ADMINISTRATION

Subchapter AA. EMPLOYEE TRAINING

28 TAC §1.2702

The Texas Department of Insurance proposes amendments to §1.2702 relating to training for employees of the department. The proposed amendments are necessary to update Subchapter AA to reflect the department's policies and procedures regarding training offered to department employees. Subchapter AA was adopted to codify department policies and procedures regarding employee training. Section 656.048 of the Government Code requires state agencies to adopt rules relating to the eligibility of employees for training and education supported by the agency and the obligations assumed by the employees on receiving the training and education.

The proposed amendments are also necessary to address certain recently enacted statutory provisions regarding employee training. State agencies are required by §21.010 of the Labor Code to provide employees with an employment discrimination training program. Therefore, the proposed amendments to §1.2702 address training regarding policies prohibiting discrimination, including sexual harassment. Section 660.147 of the Government Code specifies when a state agency may pay or reimburse a state employee for a travel expense associated with a training seminar conducted by a state agency for its employees. Therefore, amendments are proposed to §1.2702 to specify when travel expenses may be incurred by department employees to attend department-sponsored training.

The proposed amendments to §1.2702 also address the payment of instructor fees and clarify the type of information provided to department employees about department-sponsored training. In addition, the amendments to §1.2702 reflect the current agency practice of recording education leave as emergency leave, rather than administrative leave, on an employee's monthly attendance record. Several non-substantive clarifying amendments are also being proposed to §1.2702.

Stan Wedel, chief of staff, has determined that for each year of the first five years the sections are in effect, there will be no fiscal impact on state or local government as a result of enforcing or administering the sections. Mr. Wedel also has determined that there will be no effect on local employment or the local economy.

Mr. Wedel has determined that for each year of the first five years the sections are in effect the public benefit derived from enforcement and administration of the sections will be a department workforce which is effectively prepared for technological and legal developments; the provision of necessary services more effectively; and an increase in the proficiency of the department to deliver the level of regulatory services expected of it under Texas law. Mr. Wedel also has determined that no compliance cost results from the proposal of these sections, including no adverse impact on small businesses or on micro-businesses.

To be considered, comments on the proposal must be submitted in writing no later than 5:00 p.m. on September 25, 2000 to Lynda H. Nesenholtz, General Counsel and Chief Clerk, P.O. Box 149104, MC 113-2A, Austin, Texas 78714-9104. An additional copy of the comment should be simultaneously submitted to Ann Bright, Section Chief, Agency Counsel Section, Legal and Compliance, P.O. Box 149104, MC 110-1A, Austin, Texas 78714-9104. A request for public hearing on the proposed sections should be submitted separately to the Office of the Chief Clerk.

The amendments are proposed under the Insurance Code §36.001 and the Government Code §656.048. The Insurance Code §36.001 authorizes the commissioner to adopt rules and regulations for the conduct and execution of the duties and functions of the department as authorized by statute. The Government Code §656.048 provides for the adoption of rules by state agencies relating to training and education of agency employees.

The proposed amendments affect operational procedures pursuant to the following statutes: Government Code §§656.044 through 656.049, Government Code §660.147., Labor Code §21.010

§1.2702.Employee Training Program.

(a)

(No change.)

(b)

Agency-sponsored training. A program of in-house training for agency employees is provided.

(1)

Training on Policies Prohibiting Discrimination. All new employees must attend an orientation session within 30 days of their date of hire containing information on the department's policies and procedures including information on discrimination and sexual harassment. Employees must attend supplemental training on discrimination, including sexual harassment, every two years.

(2)

[ (1) ] Quarterly Training Calendar and Catalog [ of courses ]. A quarterly [ monthly ] training calendar lists course offerings. [ and a ] A training catalog [ describes ] contains course descriptions of all available courses. An employee wishing to register for in-house training courses should contact the training liaison for the employee's division. The employee's supervisor must approve all requests for in-house training.

(3)

[ (2) ] Payment of Course Fees [ material purchase for some in-house training ]. Some in-house trainings may require a division to pay for instructor fees and/or [ purchase ] course materials , payment of which is coordinated though the Professional Development section of the department's Human Resources Division . [ Upon approval by the division, the divisional training liaison should request purchase of the materials from the Professional Development Center of Human Resources. ] If the course offers an optional examination for a fee, the employee taking the course will be responsible for payment of the examination fee. Any employee passing the examination may request reimbursement of the examination fee upon proof of payment of the fee and passing the examination. Some fees may be reimbursed at a percentage of base fee amounts as determined by the commissioner. Approval of payment is contingent upon availability of funds.

(4)

Travel Expenses for Department-Sponsored Training. Travel expenses incurred by employees attending department-sponsored training will not be reimbursed unless the commissioner of insurance or his or her designee certifies the following:

(A)

The department does not possess interactive television or videoconference facilities at the designated headquarters of the employee attending the seminar;

(B)

The department cannot purchase or lease such facilities at a cost less than the total travel costs associated with the seminar; and

(C)

The department does not have access to another agency's interactive television or videoconference facilities at the same location.

(5)

The Professional Development Section of the department's Human Resources Division will assist the seminar coordinators in determining, on a case-by-case basis, the feasibility of using videoconferencing or interactive television for department-sponsored training. If it is determined that the travel expenses to attend agency sponsored training are justified, the requesting division's associate commissioner - or highest level manager who reports directly to the commissioner, if not an associate commissioner - in the employees' chain of command will prepare a written request to obtain certification from the commissioner of insurance prior to the training event. Copies of the certification must be submitted to the Professional Development section of the department's Human Resources Division and to the department's Accounting division.

(c)

(No change.)

(d)

Tuition reimbursement. The department may reimburse full-time regular employees for tuition and required fees or may grant education leave in lieu of tuition reimbursement if the criteria set out in paragraphs (1) - (5) of this subsection are met.

(1)

Eligibility. Eligibility requirements for tuition reimbursement must be satisfied as set out in subparagraphs (A) - (I) of this paragraph.

(A)

(No change.)

(B)

An employee [ must be performing consistently above that normally expected or required and ] must have achieved an overall performance rating of at least 3.25 on the employee's most recent performance evaluation at the time of the request for approval to receive tuition reimbursement or education leave.

(C) - (I)

(No change.)

(2)

Reimbursable costs. Criteria addressing the extent to which cost of tuition may be reimbursed are set out in subparagraphs (A) - (E) of this paragraph.

(A)

(No change.)

(B)

Employees may be reimbursed for the cost of tuition and related fees at an educational institution [ only ].

(C)

(No change.)

(D)

Employees will not be reimbursed for items that are not part of tuition, such as textbooks, workbooks, lab supplies [ and other such items which are not part of tuition ].

(E)

(No change.)

(3)

Education leave in lieu of tuition reimbursement. Criteria for taking education leave in lieu of tuition reimbursement are set out in subparagraphs (A) - (F) of this paragraph.

(A)

(No change.)

(B)

Before requesting education leave, employees should fully consider and explore education options that would not involve education leave. For example, employees should consider registering for classes scheduled before or after work, or during the lunch hour when courses are available at those times . Employees may also request [ should also consider requesting ] a flex-time or compressed work week schedule that would allow for class attendance without the use of education leave. Such a work schedule must not disrupt or adversely affect performance by the employee or the employee's division, section, program or activity.

(C) - (D)

(No change.)

(E)

Education leave will be treated as emergency [ administrative ] leave on the employee's monthly attendance record with a notation that the emergency [ administrative ] leave is for the purpose of attending a course approved for education leave.

(F)

An employee who has been approved for education leave in lieu of tuition reimbursement will receive, an a provisional basis, the approved amount of education leave. If the employee satisfactorily completes the course, the approved leave will remain designated as education leave. However, if the employee fails to satisfactorily complete the course for which education leave was granted, of if the employee separates from employment with the department before submitting the final grade report for any courses for which education leave was granted, the leave will be changed to annual leave, compensatory time leave or overtime leave, and the employee's leave balances will be adjusted accordingly. If the employee's leave balances are exhausted, the remaining education leave will be changed to leave without pay, and the employee's pay will be adjusted accordingly.

(4)

Procedure. Specific procedural steps required to complete the tuition reimbursement process are set out in subparagraphs (A) - (G) of this paragraph.

(A) - (B)

(No change.)

(C)

To receive reimbursement for tuition, within two weeks after receipt of the final grade in a course for which reimbursement has been approved, the employee must submit a purchase request, a copy of the final grade report, and an itemized tuition receipt to the associate commissioner -- or highest level manager who reports directly to the commissioner, if not an associate commissioner -- in the employee's chain of command [ within two weeks after receipt of the final grade in a course for which reimbursement has been approved ]. The department will not reimburse tuition if an employee separates from employment with the department before submitting the final grade report for any courses for which tuition reimbursement was granted.

(D)

If an employee has been approved for education leave, within two weeks after receipt of the final grade in a course for which education leave has been approved, the employee must submit a copy of the final grade report to the associate commissioner -- or highest level manager who reports directly to the commissioner, if not an associate commissioner -- in the employee's chain of command [ within two weeks after receipt of the final grade in a course for which education leave has been approved ].

(E) - (G)

(No change.)

(5)

Use of equipment [ Prohibition on use of state resources ]. Employees may not use department equipment, such as computers, calculators, or typewriters [ or other department equipment ] to complete course work.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on August 10, 2000.

TRD-200005583

Lynda Nesenholtz

General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: September 24, 2000

For further information, please call: (512) 463-6327


Chapter 19. AGENTS' LICENSING

Subchapter G. LICENSING OF INSURANCE ADJUSTERS

28 TAC §19.602

The Texas Department of Insurance proposes amendments to §19.602 concerning types of adjuster's licenses. These amendments are necessary to reduce the number of license types, eliminate specific license types, create greater uniformity among the states and consolidate license types that are similar in nature. The proposal amends §19.602 to consolidate casualty; fire, allied lines, inland marine; fidelity and surety; boiler and machinery; and marine adjuster license types into a single property, casualty and surety license type. The proposal combines the multi-lines and all lines license types into a single, all lines license type and retains the workers' compensation license type. Under the proposal, licensees currently holding casualty; fire, allied lines, inland marine; fidelity and surety; boiler and machinery; or marine adjuster license types on September 1, 2000 will be issued a property, casualty and surety adjuster's license to replace the license type that is being eliminated. Under the proposal, licensees holding the multi-lines adjuster's license type on September 1, 2000 will be issued an all lines adjuster's license to replace the license type that is proposed to be eliminated. The proposal allows those persons holding the CPCU or AIC designation to be licensed without an examination, eliminating the additional requirement of one year claims experience.

Matt Ray, Deputy Commissioner, Licensing Division, has determined that for each year of the first five years the proposed section will be in effect, there will be no fiscal impact to state and local governments as a result of the enforcement or administration of the rule. There will be no measurable effect on local employment or the local economy as a result of the proposal.

Mr. Ray has also determined that for each year of the first five years the amendments are in effect, the public benefits anticipated as a result of the proposal will be the streamlining of the adjuster application process and the reduction of record-keeping and storage. There will be no economic cost to the adjusters required to comply as the amendments will consolidate the license types. There will be no effect on small or micro businesses.

To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on September 25, 2000 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 comment must be simultaneously submitted to Matt Ray, Deputy Commissioner, Licensing Division, Mail Code 107-1A, Texas Department of Insurance, 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.

The amendments are proposed under the Insurance Code Article 21.07-4 and §36.001. Article 21.07-4 provides the various licensing and application procedures for adjusters and grants the commissioner the broad authority to prescribe the form an application for license will take and what information will be requested on the application. Section 36.001 provides that the Commissioner of Insurance may adopt regulations to execute the duties and functions of the Texas Department of Insurance only as authorized by statute.

The following article is affected by this proposal: TEX. INS. CODE art. 21.07-4

§19.602.Types of Adjuster's Licenses.

(a)

Any references to the Act in this subchapter are references to Insurance Code Article 21.07-4. The following types of adjuster's licenses are approved for issuance:

(1)

all lines (issuance of "all lines" adjuster's license for those adjusters who qualify in paragraphs (2) and (3) of this subsection) [ (licenses issued to applicants who for the 90-day period next preceding the effective date of the Insurance Code, Article 21.07-4 (hereinafter referred to as the Act) had been principally engaged in the investigation, adjustment, or supervision of losses and who were so engaged on the effective date of the Insurance Code, Article 21.07-4) ];

(2)

property, casualty, and surety [ including auto physical damage, auto liability, general liability, aircraft ]; and

(3)

workers' compensation, employer's liability, USL&H (U.S. Longshoremen's and Harbor Workers' Compensation Insurance). [ ; ]

[ (4)

fire, allied lines, inland marine;]

[ (5)

fidelity and surety;]

[ (6)

boiler and machinery;]

[ (7)

marine;]

[ (8)

multi-lines (issuance of "multi-lines" adjuster's license for those adjusters who qualify in paragraphs (2)-(4) of this subsection)].

(b)

Pursuant to the Act, §10(4) [ §10(a)(4) ], the following persons are exempted from the requirement of an adjuster's license examination:

(1)

those persons holding CPCU designation [ plus one year of Texas claims experience ]; and

(2)

those persons who have received the Associate in Claims (AIC) designation [ completing all six parts of the Insurance Institute of America adjusting course plus one year of Texas claims experience ].

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on July 31, 2000.

TRD-200005316

Lynda Nesenholtz

General Counsel and Chief Clerk

Texas Department of Insurance

Earliest possible date of adoption: September 24, 2000

For further information, please call: (512) 463-6327