TEXAS DEPARTMENT OF INSURANCENotification Pursuant to the Insurance Code, 
Chapter 5, Subchapter LAs required by the Insurance Code, Article 5.96 and 5.97, 
the Texas Register publishes notice of proposed actions by the Texas Board of 
Insurance. Notice of action proposed under Article 5.96 must be published in the 
Texas Register not later than the 30th day before the board adopts the proposal. 
Notice of action proposed under Article 5.97 must be published in the Texas 
Register not later than the 10th day before the Board of Insurance adopts the 
proposal. The Administrative Procedure Act, the Government Code, Chapters 2001 
and 2002, does not apply to board action under Articles 5.96 and 5.97.
The complete text of the proposal summarized here may be examined in the offices 
of the Texas Department of Insurance, 333 Guadalupe Street, Austin, Texas 78714-
9104.)
This notification is made pursuant to the Insurance Code, Article 5.96, which 
exempts it from the requirements of the Administrative Procedure Act.

Texas Department of Insurance
Exempt Filings Notification Pursuant to the Texas Insurance Code, Chapter 5, 
Article Subchapter L, Article 5.96

PROPOSED
The Commissioner of Insurance or his designee at a public hearing under Docket 
Number 2260, scheduled for November 26, 1996 at 9:00 a.m. in Room 100 of the 
Texas Department of Insurance Building, 333 Guadalupe Street in Austin Texas 
will consider amendments proposed by the staff of the Workers' Compensation 
Division to the Texas Basic Manual of Rules, Classifications and Experience 
Rating Plan for Workers' Compensation and Employers' Liability Insurance 
(Manual). The purpose of these amendments to the Manual is to eliminate 
conflicting language within the Manual and to provide clarification to rules, 
classifications, endorsements and forms by amending the language. 
The proposed changes by the staff are summarized as follows: 
Clarify the rules to reflect that the effective date of the policy determines 
the rules and rates applicable to the policy and the anniversary rating date 
determines the date the experience modifier applies and the Experience Rating 
Plan rules applicable to the policy. 
Amend the language in the rules to reflect the language of the standard workers' 
compensation policy as amended in November, 1995. 
Show the order of calculation of workers' compensation policy costs in a rule 
and delete all other examples in the rules of how the policy costs are 
determined in order to eliminate conflicts. 
Clarify the rules to reflect that the payroll limitations for executive officers 
apply regardless of the classification applicable to that executive officer. 
Clarify the rules to reflect that business allowance, such as automobile, 
housing, etc., per diem expenses in excess of IRS guidelines, and automobile 
mileage reimbursements in excess of IRS guidelines are included in the 
definition of remuneration. 
Amend the maximum minimum premium from $500 to $250. 
State in the rules that "test modifiers" cannot be applied to the policy and 
cannot be negotiated. 
Add a rule to define Schedule Rating. 
Amend the language concerning premium discount as it applies to workers' 
compensation policies written through the group purchase program and allow the 
insurance company and the group administrator to agree on how to determine the 
final premium discount for the group even though not all of the policies have 
been audited. 
Delete obsolete language from Rule IX. E. Employee Leasing Arrangements and 
allow the completion of the Employee Provider Form EP-1, Employee Provider Form 
EP-1A and the Employee Provider/Client Company Endorsement to be optional with 
the insuring company, which includes the Texas Workers' Compensation Insurance 
Fund. 
Amend Rule IX Deductible Programs to discontinue the filing of the Deductible 
Notice of Election form with the Texas Department of Insurance, but require the 
insuring company to have the completed Deductible Notice of Election form in the 
file for each insured so that it is available to the Department upon specific 
request.
Amend Section I A. of the Experience Rating Plan to clarify which insurance 
company is responsible for calculating the experience modifier for a risk when 
there are multiple insurers writing the risk. Amend Section I A. of the 
Experience Rating Plan to require upon receipt of a written request, an 
insurance company to provide unit statistical data to the insurance company 
responsible for calculating the experience modifier for an insured or the entity 
calculating experience modifiers on behalf of the that insurance company. In 
addition, upon request, an insurance company must provide a copy of the modifier 
calculation of an insured to another insurance company. All requests must 
include either the current policy information page for the insured or a letter 
of authority signed by the insured. 
Amend Section 1 C. 4. of the Experience Rating Plan to clarify how the 
anniversary rating date is established when there are multiple policies for the 
same risk. 
Amend Section I C. of the Experience Rating Plan to set forth ways to establish 
a different anniversary rating date. 
Clarify Section III A. of the Experience Rating Plan that only experience 
developed under a workers' compensation policy or as a certified self-insurer 
can be used to determine eligibility for experience rating and to actually 
calculate the experience modifier. 
Amend Section V E. of the Experience Rating Plan to indicate what experience 
modifier applies when there is no modifier calculated at the time the policy is 
issued; to indicate that whenever there is a decrease in the premium as a result 
of an experience modifier being added to the policy, the decrease in premium is 
always applicable to the effective date of the policy or to the anniversary 
rating date, if different than effective date of the policy and to indicate when 
an increase in premium as a result in adding the experience modifier is 
applicable to the policy. 
Amend Section V F. of the Experience Rating Plan to clarify that when the unit 
statistical data is received by the insuring company, the experience modifier 
will be recalculated and the application of the revised modifier is governed by 
Section G. of the Experience Rating Plan. 
Amend the Introduction to the Endorsements & Forms section to require insurance 
companies to either show an endorsement issue date or a sequential number on 
each endorsement in order to determine the order of issuance. 
Amend the Texas Amendatory Endorsement WC 42 03 01 to delete the reference to 
the short rate cancellation penalty being applied at the time of final payroll 
audit since short rate cancellations are no longer applicable. 
Delete the following endorsements as they are no longer applicable: Texas 
Assigned Risk Pool--Maritime Coverage Endorsement (Limited Coverage for Masters 
or Members of the Crews of Vessels) WC 42 02 01; Texas Workers' Compensation 
Insurance Fund-Other States Endorsement (Reimbursement for Temporary Operations 
Only) WC 42 03 07; and Senate Bill 1 Litigation Surcharge Endorsement WC 42 04 
05; 
Amend Texas Waiver of Our Right to Recover From Others Endorsement WC 42 03 04 
to include language to clarify that nothing in the endorsement shall be 
construed as a limit on the insurance companies' right of subrogation for 
advances against future benefits, including medical benefits received by 
claimants under the Texas Workers' Compensation Act as long as that right exists 
under the Act or common law. 
Amend Employee Provider/Client Company Endorsement WC 42 04 06A to substitute 
the Fund for the Facility in the wording of the endorsement and to delete 
Section 12 of the endorsement in its entirety since it is in conflict with the 
Statute. 
Amend the language in form DNE-1 to track the language in the rule and the 
endorsements pertaining to the deductible to eliminate the conflicts. Amend the 
timing of the filing requirements for the filing of form GPP-2 for groups 
participating in the group purchase program. 
Elimination of the Workers' Compensation Negotiated Experience Modifier form. 
Editorial changes throughout the Manual to correct punctuation, typographical 
errors, reference to the Statutes, and reference to rules contained in the 
Manual. 
Editorial changes to the footnotes and classification wordings in the 
Classification Section of the Manual. 
Addition of several classification wordings that were inadvertently left out 
when then classifications were reduced and combined effective January 1, 1994. 
Divide the Wrecking Classification Code 5701 into the following classifications: 
Concrete or Concrete Encased Steel & Drivers-Code 5213; Iron or Steel & Drivers-
Code 5057; Masonry & Drivers-Code 5022 and Wooden - including dwellings & 
Drivers-Code 5403. 
Changes in the following classifications to classifications with lower 
relativities: Appraisers - Tax from Code 4511 to Code 8742; Breakwater or Jetty 
Construction from Code 6219 to Code 6045; Dike or Revetment Construction & 
Drivers from Code 6219 to Code 6045; Kennel Employees & Drivers from Code 0113 
to Code 8831; Forestry Personnel-Planting & Supervision of Timber Forest from 
Code 0042 to Code 0005; Inspection of Risks for Insurance or Valuation Purposes 
from Code 4511 to Code 8742; Plant Rental or Maintenance from Code 0035 to Code 
8017; Satellite Dish Installation from Code 5l90 to Code 7600; and Service 
Station Wash Pit Cleaning from Code 9402 to Code 7219. The Commissioner has 
jurisdiction over this matter pursuant to the Insurance Code, Articles 5.56, 
5.57, 5.60 and 5.96.
A copy of the amendments containing 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 Angie Arizpe 
(512) 322-4147, (refer to Reference Number W-1096-44-I). 
The staff and the Commissioner request that written comments to these proposed 
amendments be submitted prior to the public hearing on November 26, 1996. The 
written comments should be directed to Caroline Scott, General Counsel and Chief 
Clerk, Texas Department of Insurance, P.O. Box 149104, MC 113-2A, Austin, Texas 
78714-9104. An additional copy of the comments is to be submitted to Nancy 
Moore, Deputy Commissioner, Workers' Compensation, Texas Department of 
Insurance, P.O. Box 149092, Austin, Texas 78701-9092. Public testimony at the 
hearing on November 26, 1996, is also invited and encouraged. 
This notification is made pursuant to the Insurance Code, Article 5.96, which 
exempts it from the requirements of the Government Code, Chapter 2001 
(Administrative Procedure Act).
The agency hereby certifies that the proposal has been reviewed by the legal 
counsel and found to be within the agency's authority to adopt. 
Issued in Austin, Texas, on October 16, 1996.
TRD-9615142
Caroline Scott
General Counsel
Texas Department of Insurance
Filed: October 16, 1996

PROPOSED
The Commissioner of Insurance or his designee at a public hearing under Docket 
Number 2261, scheduled for November 26, 1996, at 9:00 a.m. in Room 100 of the 
Texas Department of Insurance Building, 333 Guadalupe Street in Austin, Texas, 
will consider amendments to Rule IX A. and B, the deletion of Partners, Officers 
and Others Exclusion Endorsement WC 00 03 08 and Sole Proprietors and Others 
Coverage Endorsement WC 00 03 10 and the addition of Partners, Officers and 
Others Exclusion Endorsement WC 42 03 08 and Sole Proprietors, Partners, 
Officers and Others Coverage Endorsement WC 42 03 10 of the Texas Basic Manual 
of Rules, Classifications and Experience Rating Plan for Workers' Compensation 
and Employers' Liability Insurance (the Manual). The purpose of this amendment 
is to implement the provisions of Subchapter F, Chapter sec.406.097, Labor Code 
as added by the 74th Legislature in House Bill 1089. 
Section 406.097, Labor Code, provides that a sole proprietor, partner, or 
corporate executive officer of a business entity that has elected to provide 
workers' compensation coverage is entitled to benefits under that coverage as an 
employee unless the sole proprietor, partner, or corporate executive officer is 
specifically excluded from coverage through an endorsement to the policy or 
certificate of authority to self-insure. In addition, a corporate executive 
officer(s) of the named insured with at least 25% equity ownership in the named 
insured may be excluded from coverage. Lastly, a sole proprietor or partner of a 
covered business or a corporate officer with an equity ownership in a covered 
business of at least 25% may be excluded from coverage even though building or 
construction contracts require the contractor to provide workers' compensation 
coverage when work is being performed for a governmental entity. In addition to 
the proposed changes to Rule IX A. and B, two endorsements are being recommended 
for deletion, and two new endorsements that are Texas specific endorsements are 
being recommended. 
The Commissioner has jurisdiction over this matter pursuant to the Insurance 
Code, Article 5.96. 
A copy of the amendments containing 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 Angie Arizpe 
(512) 322-4147, (refer to Reference Number W-1096-45-I). 
The staff and the Commissioner request that written comments to these proposed 
amendments be submitted prior to the public hearing on November 26, 1996. The 
written comments should be directed to Caroline Scott, General Counsel and Chief 
Clerk, Texas Department of Insurance, P.O. Box 149104, MC 113-2A, Austin, Texas 
78714-9104. An additional copy of the comments is to be submitted to Nancy 
Moore, Deputy Commissioner, Workers' Compensation, Texas Department of 
Insurance, P.O. Box 149092, Austin, Texas 78701-9092. Public testimony at the 
hearing on November 26, 1996, is also invited and encouraged. 
This notification is made pursuant to the Insurance Code, Article 5.96, which 
exempts it from the requirements of the Government Code, Chapter 2001 
(Administrative Procedure Act). 
The agency hereby certifies that the proposal has been reviewed by the legal 
counsel and found to be within the agency's authority to adopt. 
Issued in Austin, Texas, on October 16, 1996.
TRD-9615141
Caroline Scott
General Counsel
Texas Department of Insurance
Filed: October 16, 1996

PROPOSED
The Commissioner of Insurance or his designee at a public hearing under Docket 
Number 2262, scheduled for November 26, 1996, at 9:00 a.m. in Room 100 of the 
Texas Department of Insurance Building, 333 Guadalupe Street in Austin, Texas, 
will consider amendments to Section D of the Appendix and Sections III and X of 
the Texas Experience Rating Plan of the Texas Basic Manual of Rules, 
Classifications and Experience Rating Plan for Workers' Compensation and 
Employers' Liability Insurance (the Manual). These recommended changes are 
necessary due to the Commissioner appointing the National Council on 
Compensation Insurance as the statistical agent for workers' compensation. The 
proposed change to Section D of the Appendix of the Manual deletes the reference 
to the Department and requires insuring companies to automatically file with the 
designated statistical agent all data required by the Texas Workers' 
Compensation Statistical Plan in accordance with its provisions. The change to 
Section III of the Texas Experience Rating Plan of the Manual amends part D. to 
require experience to be used in the calculation of the experience modifier to 
be reported to the designated statistical agent. The change to Section X of the 
Texas Experience Rating Plan of the Manual requires insuring companies to 
automatically file with the designated statistical agent all data required by 
the Texas Workers' Compensation Statistical Plan in accordance with its 
provisions. The Commissioner has jurisdiction over this matter pursuant to the 
Insurance Code, Article 5.96.  
A copy of the amendments containing 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 Angie Arizpe 
(512) 322-4147, (refer to Reference Number W-1096-46-I). 
This notification is made pursuant to the Insurance Code, Article 5.96, which 
exempts it from the requirements of the Government Code, Chapter 2001 
(Administrative Procedure Act). 
The agency hereby certifies that the proposal has been reviewed by the legal 
counsel and found to be within the agency's authority to adopt. 
Issued in Austin, Texas, on October 16, 1996.
TRD-9615140
Caroline Scott
General Counsel
Texas Department of Insurance
Filed: October 16, 1996

PROPOSED
The Commissioner of Insurance or his designee at a public hearing under Docket 
Number 2263, scheduled for November 26, 1996, at 9:00 a.m. in Room 100 of the 
Texas Department of Insurance Building, 333 Guadalupe Street in Austin, Texas, 
will consider amendments to the Texas Workers' Compensation Relativity, Expected 
Loss Rate and Discount Ratio for Code 8837-Charitable or Religious Organization-
All Operations & Drivers. Under Board Order Number 59621 dated June 2, 1992, 
Code 8837 was amended from a classification with a promulgated rate or 
relativity to an "a" rated classification due to the wide variance of work 
performed by the various charitable or religious organizations being classified 
under that code. By making Code 8837 an "a" rated classification, the insurance 
company writing coverage for this classification can use rates reflective of the 
various activities performed by specific entities classified under this 
classification. Therefore, a fixed relativity, expected loss rate and discount 
ratio for Code 8837 is not proper. This amendment is proposed to eliminate the 
revised classification relativity, the revised expected loss rate and discount 
ratio related to Code 8837 which were adopted by the Commissioner in 
Commissioner's Order Number 96-1038 dated September 10, 1996.  
The Commissioner has jurisdiction over this matter pursuant to the Insurance 
Code, Article 5.96. 
A copy of the amendments containing 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 Angie Arizpe 
(512) 322-4147, (refer to Reference Number W-1096-47-I). 
This notification is made pursuant to the Insurance Code, Article 5.96, which 
exempts it from the requirements of the Government Code, Chapter 2001 
(Administrative Procedure Act). 
The agency hereby certifies that the proposal has been reviewed by the legal 
counsel and found to be within the agency's authority to adopt.
Issued in Austin, Texas, on October 16, 1996.
TRD-9615151
Caroline Scott
General Counsel
Texas Department of Insurance
Filed: October 16, 1996