Court Opinion

ID: 4135359
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:01:17.67348+00
Date Added: 2024-06-11T14:21:51.985644
License: Public Domain

Hon. William A. Harrison              Opinion No. C- 101
Commissioner of Insurance
State Board of Insurance              Re: (1) Whether “credit insurance”
Austin, Texas                             in Article 21.07-1,     Sec. 1, Par.
                                          (b)(5), T. I. C. , refers only to
                                          credit insurance as defined in
                                          Article 3. 53, T.-I. C. ; (2) Whether
                                          agentslicensed     pursuant to Art.
                                          21.07-1,   T.I.~C., need obtain an
                                          additional license if they engage in
                                          activities specified in Article 21.07-       1,
                                          See; 1, Par. (b)(5).

Dear Mr. Harrison:

         You have requested our opinion as to the following questions,:

          1. Does the exception in Art. 21.,07-l,   Sec. 1. Par. (b)(5) refer
only to the credit insurance defined in Art. 3.53 of the Texas Insurance Code;
or does this exception also embrace insurance not included,in the definition
set out in Art. 3.53 (e.g.,  a policy, of insurance sold fin connection with a
loan in excess of $1,000. OO)?

          2. May an insurance agent, licensed under Art. 21.07-l    and
acting exclusively for legal reserve companies, engage in the activities
specified~in Art. .21.07-l, Sec. 1, Par. (b)(5) of the Texas Insurance Code
without obtaining an additional license?

         In regard to your first question, Article 21.07-1,    T.-I.   C., provides
for the qualification and licensing of agents of legal reserve life    insurance
companies authorized to do business in Texas.      Section 1 (b)(5)    provides that
the term “life insurance agent” as used in this article shall not      apply to:

                                      -497-
Hon. William A. Harrison,    page 2     (C- 101   )

             “An agent selling credit life, health and accident
         insurance issued exclusively in connection with com-
         mercial loan, or acting as agent or solicitor for health
         and accident insurance under license issued pursuant
         to the provisions of Article 21. 14 of the Texas Insur-
         ance Code. ‘I

        Article 3.53, Sec. 1 (B) defines “Credit Life Insurance” and
“Credit Health and Accident ~Insurance” as follows:

             “Credit Life Insurance, I’and “Credit Health and
          Accident Insurance” mean pereonal insurance in which
          the insured are bor,r.owers of sums of money not ex-
          ceeding ~0ne Thousand ($1, 000. 00) ‘Dollars fr,om lenders
         :who retain an interest .in the insurance as security to the
          loan, and any .other personal insurance written in con-
         nection with or as part of such loan transaction.     “Credit
          Health Insurance” and “Credit Health and Accident Insur-
          ance” as used~in this article shall never be taken-to mean
          or refei to any contract insuring performance of any under-
         taking or agreement, and are expressly limited in their
         coverage to the contingencies of deathor loss resulting
         from sickness and accident. ‘I

          Article 3.~53.was originally enacted in 1949, Acts 51st Leg., R.-S.,
~1949. p. 13,2, ch. 81, and was amended in 1951, Acts ,52nd Leg., R.S. 1951,
p. 336. ch. 207.    The statute as amended was included as Article 3. 53 af
the Texas Insurance Code, Acts 52nd Leg., R.S. 1951., p. 868, ~ch. 491..

          Article 21.07-l  was enacted in 1955, Acts 54th,Leg., .R:S. ‘1955,
p. 621, ch. .213. These two articles of,the Texas Insurance Code are ,in
reality,two separate statutes enacted by different sessions of the Legislature,
and~included in the Texas Insurance Code at different sessions.    Ip answer-
ing your questions ,it become8 material to ascertain the intent of the Legis-
lature in enacting the provisions of the two different articles.

          The intention and meaning of the Legislature is to be ascertained
pr,imarily from the language of the statute read as a whole. If the statutory
language clearly and distinctly reveals the legislative intent there is no
occasion to look elsewhere.    39 Tex. Jur. 176 893 and cases cited therein.

                                      -498-
        HOA.   William     A. Harrison,       page 3    (C-101   )

                  Both the title and language of Article 3.,53 manifest a clear legis-
        lative intent to regulate Credit Life Insurance and Credit Health and Acci-
        dent Insurance as defined by that statute.

                      Article   3. 53. Sec.   1 (B)(2) reads as follows:

                         “The provisions :of this article shall apply only to
                     the writing of “Credit Life Insurance” and “Credit
., ,.                Health and Accident Insurance” as defined in this
                     article, both as to “Insurer” and “Insurance Agent”
                     and “Lender Agent” as defined in thin article. I’

    _.         3’     Article 3.~53, Set;     14,. provides,:

                          ‘:?‘Nothing in, this article shall ever be construed
                       to include or affect in any manner group life insur-
                       ance issued under the provisions of Article 3.50, or
                      .aisy other.kind of insurance written by .jnsurance
                       carriers or their insurance agents otherthan credit
                    .’ life .insuran&e and credit health and accident insur
                       ante as defined herein. ”

             It is obvious from theae’two provisions that the Legislature in
_ ‘Article 3.53’expresely.defined   the terms ~Xredit Life Insurance” and
 I. “Credit Health and Accident ~Insurance*Vfor the purposes of. that article only
    and explicitly restricted the use of thos,e terms as dsfined,to that article.

               Article 21.07-1,  as io noted abwe, was enacted six years after
    Article 3. 53. By~the well-known rules of statutory construction,. it may
    be properly presumed that the Legislature bad knowledge, of the existing
    statutes and the effect thereof when they enacted the later statute.   Cole
:,~ v.~ State,. 106 Tex. 472.; 170 S.W. 1036 (1914); Stephens Countyv. Hef;ler.
    118 Tex. 397, 16 S.W.2d 804 (1929); Railroad Commission of Texas v.
    Texas & New Orleans Ry. Co., 42 S.W.2d 1091 (Tex.Civ.App.,          1931, err.
    ref. ).

                  Article 21.07-l   relates to the licensing of agents of legal res.erve
        life insurance companies and establishes the qualifications and procedures
        under which individuals will be licensed as agents for legal reserve life
        insurance companies.      Sec. 1 (b)(5) of the article quoted above exempts
        “agents selling credit life, health and accident insurance issued ~exclusively

                                                        -499-
  Hon. ~William A. Harriron,    page 4   (C-101   )

: ‘in connection with commercial~loan.     . . ‘1 fr~om the licensing pr,oviaione of
  .that article. The terms ,**credft life, health and accident insurance” are not
   further defined by Article 21.07-1,.   nor is there any reference to those terms
   as defined by Article 3. 53.

            The Legislature when enacting Article 21.07- 1 is presumed to have
  known of Article 3. 53~, its provisions , and the effect of those provisions.  The
  Legislature in Article 21.07- 1 ,made no attempt to incorporate the earliek
  statutory definition of credit ~insurance contained in Article 3.53 into ,the
  later statute, nor did they attempt either expressly or impliedly to repeal any
  of the provis,ions of Article 3. 53 restricting the provisions of that statute
  solely to that article.  The two articles treat two different subjects and were
  enacted to accomplish two different objects.     Article 21.07-,I, Sec.. lo
  merely creates a class of persons who for ,the purposes of that Article are not
  required to be licensed as insurance agents pursuant to the terms of that
  article.

           In answer to your first question it is our opinion that the credit life,
  health and ~accident.insurance referred to in Article 21,. 07-l) Section 1 (b)(5)
 -does not Ryder only to.snch;credit insurance asis defined ,in Article 3.53.

            Attorney General’s Opinion No. WW-297-A,       while not considering
 .the question rais:ed her.ein, contains aever~al general~statemente ~to the effect
  that the credit insurance of Article 21.07-1,   Sec. 1 (b)(S) refers solely to
  credit insurance as defined in Article 3.,53, -Sec. 1 (@)(I.). We hereby overrule
  such statements fin that ,opinion which conflict with the opinion expreesed herein.

            In regard to your second question, Article 21.07-I .is the statute
  regulating.&? qualifications and licensing procedures for agents within the
  ~scope of that article, who represent legal reserve life insurance companies
  authorized to do ~bueineas in