1983-03-16 Regular Meeting La Porte City Council

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statute. To the extent the county attempts to collect premiums from the employees for the benefit of their dependents, such self -funded plan would not be authorized by article 2372b and would contrzvenu the texas Insurance Code. The Texas Insurance Code requires .authorization by the State Board of Insurance before a person or entity can engage in the business of •insurance.• Ins. Code art. 1.14,,51: The business of ' insurance is defined as the commission of one or more acts set forth #n article 1.14-1, section 2 (a), subsection 4 of the Insurance Code which include: The receiving or collection of any premium, co=_ission, membership fees, assessments, dues or. other consideration for any insurance or 2ny part - thereof. The receiving or collection of employee contributions for dependents to participate in the proposed plan would ".constitute collection of a premium. • Although 2 co=-iissioners court may adopt rules and regulations to implement a self-insurance fund as authorized under section 2 of article 2372h, such fund must comply with the restraints set forth in that statute. We have found no other authority which would permit a county to implement a self -funded program to pay health claims of its : employees. Fowever, a county may not collect premiums from employees to pay for the participation of dependents in the self-insurance *am, since such would constitute the unauthorized business of insurance in violation of article 1.14-1•of the Texas Insurance Cgde. S U M M A R Y • A commissioners court nay establish a self-insurance fund under article 2372h, section 2, V.T.C.S., for the benefit of county officials and employees, but the county may not collect premiums from employees for the inclusion of • dependents in the self-insurance fund. • Very truly yours, M A R K V H I T E Attorney General of Texas - JOHN W. FAINTER, :IR. First Assistant Attorney General _ -• p• 1659