CANCELLATION OF GROUP COVERAGE IN CERTAIN CIRCUMSTANCES

Tex. INS Code ch. 1253

in effect

Tex. INS Code § 1253.001. LIMITATION OF SERVICES AND BENEFITS ON CONTRACT RENEGOTIATION.

(a) In this section, "health benefit contract" means a contract providing group health care coverage for employees that is delivered, issued for delivery, or renewed in this state by: (1) an insurance company; (2) a group hospital service corporation operating under Chapter 842 ; or (3) a health maintenance organization operating under Chapter 843 . (b) Subject to Subsection (c), if an employer in this state agrees to renegotiate a health benefit contract, a change in the renegotiated contract may not operate solely to terminate eligibility with respect to any member of the group who, before the contract was renegotiated: (1) was covered under the contract; and (2) had a sickness or injury for which a service was being provided or a benefit was being paid under the contract. (c) A renegotiated health benefit contract may include a different durational or dollar limit or a different deductible amount or amount of coinsurance applicable to a sickness or injury for which a service was being provided or benefit was being paid before the contract was renegotiated if that same or a similar limit or amount applies to a service provided or benefit paid for a similar sickness or a related condition or injury covered by the contract. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005. SUBCHAPTER B. CONTINUATION OF GROUP ACCIDENT AND HEALTH INSURANCE POLICIES DURING LABOR DISPUTE

Tex. INS Code § 1253.051. APPLICABILITY OF SUBCHAPTER.

This subchapter applies to a group accident and health insurance policy that is delivered or issued for delivery in this state and as to which any part of the premium is paid or is to be paid by an employer under the terms of a collective bargaining agreement. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.052. CONTINUATION OF GROUP ACCIDENT AND HEALTH INSURANCE DURING LABOR DISPUTE REQUIRED FOR CERTAIN POLICIES.

An insurer may not deliver or issue for delivery a policy subject to this subchapter unless the policy provides that if the employees covered by the policy stop work because of a labor dispute, coverage continues under the policy, on timely payment of the premium, for each employee who: (1) is covered under the policy on the date the work stoppage begins; (2) continues to pay the employee's individual contribution, subject to the conditions provided by this subchapter; and (3) assumes and pays during the work stoppage the contribution due from the employer, subject to the conditions provided by this subchapter. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.053. CONTRIBUTIONS IF POLICYHOLDER IS TRUSTEE.

(a) An employee's contribution for purposes of a policy as to which the policyholder is a trustee or the trustees of a fund established or maintained wholly or partly by the employer is the amount the employee and employer would have been required to contribute to the fund for the employee if: (1) the work stoppage had not occurred; and (2) the agreement requiring the employer to make contributions to the fund were in effect. (b) The policy may provide that continuation of coverage is contingent on the collection of individual contributions by the policyholder or the policyholder's agent. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.054. CONTRIBUTIONS IF POLICYHOLDER IS NOT TRUSTEE.

(a) A policy as to which the policyholder is not a trustee or the trustees of a fund established or maintained in whole or in part by the employer must provide that the employee's individual contribution: (1) is the policy rate applicable: (A) on the date the work stoppage begins; and (B) to an individual in the class to which the employee belongs as provided by the policy; or (2) if the policy does not provide for a rate applicable to an individual, is an amount equal to the amount determined by dividing: (A) the total monthly premium in effect under the policy on the date the work stoppage begins; by (B) the total number of insureds under the policy on that date. (b) The policy may provide that continuation of coverage under this subchapter is contingent on the collection of individual contributions by the union or unions representing the employees. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.055. PAYMENT OF CONTRIBUTION AND PREMIUM.

A policy may provide that continuation of coverage for an employee under the policy is contingent on timely payment of: (1) contributions by the employee; and (2) the premium by the entity responsible for collecting the individual employee contributions. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.056. PAST DUE PREMIUM.

(a) A policy may provide that the continuation of coverage is contingent on payment of any premium that: (1) is unpaid on the date the work stoppage begins; and (2) became due before the date the work stoppage begins. (b) A premium described by Subsection (a) must be paid before the date the next premium becomes due under the policy. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.057. INDIVIDUAL PREMIUM RATE INCREASE.

(a) A policy may provide that, during the period of a work stoppage, each individual premium rate shall be increased by an amount not to exceed 20 percent of the amount shown in the policy, or a greater percentage as approved by the commissioner, to provide sufficient compensation to the insurer to cover increased: (1) administrative costs; and (2) mortality and morbidity. (b) If a policy provides for a premium rate increase in accordance with this section, the amount of an employee's contribution must be increased by the same percentage. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.058. PREMIUM RATE CHANGE NOT LIMITED.

(a) This subchapter does not limit any right of the insurer under a policy to increase or decrease a premium rate before, during, or after a work stoppage if the insurer would be entitled to increase the premium rate had a work stoppage not occurred. (b) A change in a premium rate made in accordance with this section takes effect on a date that is determined by the insurer in accordance with the terms of the policy. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.059. LIMITATIONS ON CONTINUATION OF COVERAGE.

This subchapter does not require the continuation of coverage under a policy for any loss of time benefits included in the policy or the continuation of other coverage for a period: (1) longer than six months after a work stoppage occurs; (2) beyond the time that 75 percent of the covered employees continue the coverage; or (3) as to an individual covered employee, beyond the time that the employee takes a full-time job with another employer. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Tex. INS Code § 1253.060. OTHER PROVISIONS; COMMISSIONER APPROVAL REQUIRED.

A policy may contain any other provision relating to continuation of policy coverage during a work stoppage that the commissioner approves. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 3, eff. April 1, 2005.

Source: TX Statutes (Official Site)URL: https://statutes.capitol.texas.gov/Fetched: 6/29/2026