end of each two years, or oftener if he deems necessary, in person or by one or more examiners, commissioned in writing, visit each company organized under the laws of this State and examine its financial condition and its ability to meet its liabilities. He shall have free access to all the books and papers of the company or agents thereof relating to the business and affairs of such company, and shali have power to summon and examine under oath the officers, agents and employes of such company and any other person within the State relative to the affairs of such insurance company. He may revoke or modify any certificate of authority issued by him when any conditions or requirements prescribed by law for granting it no longer exist; provided, that he shall give such company at least ten days notice in writing of his intention to revoke or modify such certificate of authority issued by him, stating specifically the reasons why he intends to revoke or modify such certificate. The expense of every such examination shall be paid by the company so examined, but the commissioner shall not make any charge for services except for traveling or other actual expenses and shall furnish the company with an itemized statement of such expenses.

SEC. 42. No corporation or stock company shall be licensed or granted a certificate of authority as the agent or representative of any life insurance company in soliciting, selling or in any manner placing life insurance policies or contracts in this State. No life insurance company shall hereafter be granted a certificate of authority to transact business in this State which has or is bound by any valid subsisting contract with any other corporation, by virtue of which such other corporation is entitled to receive directly or indirectly in per centage or portion of the premium or other income of such life insurance company for any period. No person shall hereafter be granted a certificate of authority as the agent of any life insurance company, who, after this Act takes effect, enters into any contract with any corporation other than such life insurance company, by virtue of which such other corporation is entitled to receive, directly or indirectly, any compensation earned by him as agent for such life insurance company, or any per centage or portion thereof for any period.

SEC. 43. Any such insurance company transacting business within this State whose capital stock shall become impaired to the extent of thirty-three and one third per cent thereof, computing its liabilities according to the terms of this Act, shall make good such impairment within. sixty days, by reduction of its capital stock, (provided such capital stock shall in no case be less than $100,000) or other wise, and failure to make good such impairment within said time shall forfeit its right to write new business in this State until said impairment shall have been made good. And provided, that the Commissioner of Insurance and Banking may apply to any court of competent jurisdiction for the appointment of a receiver to wind up the. affairs of such company when its capital stock shall become impaired to the extent of fifty per cent thereof, computing its policy liabilities according to the American Experience Table of Mortality and four and one-half per cent interest. And provided, further, that no company shall write new business in Texas when its net surplus to policy holders is less than $100,000.

SEC. 44. Life insurance companies shall within five days after the issuance of and the placing upon the market any form of policies of life insurance file a copy of such form of policy with the Department of Insurance and Banking.

SEC. 45. No insurance company transacting business in this State shall hereafter be permitted to issue or sell any policy of industrial life insurance, or any policy of accident or health insurance, until the form thereof has been submitted to the Commissioner of Insurance and Banking. If the Commissioner of Insurance and Banking shall approve the form of such policy as complying with the requirements of the laws of this State, the same may thereafter be issued and sold. If he shall disapprove the same any such company may institute a proceeding in any court of competent jurisdiction to review his action thereon.

SEC. 46. No foreign or domestic insurance company shall transact any insurance business in this State, other than the lending of money, unless it shall first procure from the Commissioner of Insurance and Banking a certificate of authority stating that the requirements of the laws of this State have been fully complied with by it, and authorizing it to do business in this State. Such certificate of authority shall expire on the last day of February in each year, and shall be renewed annually so long as the company shall continue to comply with the laws of the State, such renewals to be granted upon the same terms and considerations as the original certificate.

SEC. 47. Every such foreign company shall, by resolution of its board of directors, designate some officer or agent who is empowered to appoint or employ its agents or solicitors in this State and such officer or agent shall promptly notify the commissioner in writing of the name, title and address of each person so appointed or employed. Upon receipt of this notice, if such person is of good reputation and character, the commissioner shall issue to him a certificate which shall include a copy of the certificate of authority authorizing the company requesting it to do business in this State and the name and title of the person to whom the certificate is issued. Such certificate, unless sooner revoked by the commissioner for cause or cancelled at the request of the company employing the holder thereof, shall continue in force until the first day of March next, after its issuance, and must be renewed annually.

SEC. 48. Cause for the revocation of the certificate of authority of an agent or solicitor for an insurance company may exist for violation of any of the insurance laws, or if it shall appear to the commissioner upon due proof, after notice that such agent or solicitor has knowingly deceived or defrauded a policy holder or a person having been solicited for insurance or that such agent or solicitor has unreasonably failed and neglected to pay over to the company or its agent entitled thereto any premium or part thereof, collected by him on any policy of insurance or application therefor. The commissioner shall publish such revocation in such manner as he deems proper for the protection of the public, and no person whose certificate of authority as agent or solicitor has been revoked shall be entitled to again receive a certificate of authority as such agent or solicitor for any insurance company in this State for a period of one year.

SEC. 49. Any person who for direct or indirect compensation solicits insurance, in behalf of any company, or transmits for a person other than himself, an application for a policy of insurance to or from such company, or assumes to act in negotiation of insurance without a certificate of authority to act as agent or solicitor for such company, or after such certificate of authority shall have been cancelled or revoked, shall be guilty of a misdemeanor and upon conviction shall be punished. by a fine or not less than one hundred dollars.

SEC. 50. Any such agent or solicitor who knowingly procures by fraudulent representations payment of an obligation for the payment of a premium of insurance shall be deemed guilty of a misdemeanor and upon. conviction shall be punished by a fine of not less than one hundred dollars, nor more than one thousand dollars.

SEC. 51. Any insurance agent or solicitor who collects premiums for an insurance company lawfully doing business in this State and who embezzles or fraudulently converts or appropriates to his own use, or with intent to embezzle takes, secretes, or otherwise disposes of or fraudulently withholds, appropriates, lends, invests or otherwise uses or applies any money or substitutes for money received by him as such agent or broker, contrary to the instructions or without the consent of the company for or on account of which the same was received by him, shall be deemed guilty of theft of property of the value of the amount involved in either case, and shall be punished accordingly.

SEC. 52. Any solicitor, agent, or examining physician who shall knowingly or wilfully make any false or fraudulent statement or representation in or with reference to any application for insurance shall be deemed guilty of a misdemeanor and upon conviction shall be punished by a fine of not less than one hundred dollars, nor more than five hundred dollars.

SEC. 53. On the 31st day of December of each and every year or as soon thereafter as may be practicable, the Commissioner of Insurance and Banking shall have calculated in his office the re-insurance reserve for all unexpired risks of all insurance companies organized under the laws of this State, or transacting business in this State, transacting any kind of insurance other than life, fire, marine, inland, lightning or tornado insurance, by taking fifty per cent of the gross premiums on all unexpired risks that have less than one year to run and a pro rata of all premiums received on risks that have more than one year to run.

SEC. 54. Every insurance company which has for ten years or more undertaken to insure persons, firms or corporations against loss or damage on account of the bodily injury or death by accident of any person, for which loss or damage said persons, firms or corporations are respectively responsible, shall on or before the first day of October in each year render to the Insurance Commissioner a statement in writing of its business transacted in the United States which shall show separately for each of the five calendar years constituting the first half of the period of ten years next preceding the thirty-first day of December of the year in which the statement is made:

1. The number of persons reported injured under all its forms of liability policies, whether such injuries were reported to the home office.

of the company or to any of its representatives, and whether such injuries resulted in loss to the company or not.

2. The amount that on or before the thirty-first day of August of the year in which the statement is made had been paid, on account or in consequence of all injuries so reported, including therein all payments on suits arising from such injuries.

3. The number of suits or actions under such policies on account of injuries reported which have been settled either by payments or compromise.

4. The amount paid in settlement of such suits or actions on or before the thirty-first day of August of the year when the statement is made, including therein all payments made on account or in consequence of injuries from which the suits arose, whether prior to or later than the date when the suits were brought.. Every such company shall in its financial statements hereafter made in this State use the experience so ascertained for computing its outstanding losses under all its forms of liability policies, irrespective of the date when the policies were issued. The average cost per suit of settling such cases, as computed by the data required in this Section, shall be multiplied by the number of suits or actions pending on account of injuries reported prior to eighteen months previous to the date on which the condition of the company is to be ascertained and shown, which suits or actions are being defended for or on account of a holder of any such policy, also the average cost on account of each injured person, determined as aforesaid from the company's experience, shall be multiplied by the number of injuries reported within the eighteen months prior to making the statement of the company's condition, whether such injuries were reported to the home office of the company or to any of its representatives. From the sum of these two products so ascertained there shall be deducted the amount of all payments made on account or in consequence of said injuries reported within eighteen months, this amount so deducted to be taken as of the date at which the said statement is made. The sum remaining after making this deduction shall be charged as the liability of the company on account of outstanding losses. Any admitted company issuing liability contracts which by reason of its limited experience in liability underwriting cannot furnish the information required by this Section shall, nevertheless, until it is able to comply with said requirements be charged with a liability for outstanding losses upon all kinds of its liability policies an amount not less than the amount resulting from the following process:

The number of suits or actions pending on account of injuries reported prior to eighteen months previous to the date of making up the statement, whether such injuries were reported to the home office of the company or to any of its representatives, which are being defended on account of the holder of any policy shall be multiplied by the average cost per suit as shown by the average experience of all other admitted liability companies ascertained from the data required by this Section, also. the number of injuries reported under said policies at any time within eighteen months of making up the statement whether reported to the home office of the company or to any of its representatives and whether such injuries resulted in loss to the company or not, shall be multiplied.

by the average cost for each injured person as shown by the average of said experience of all other admitted liability companies, ascertained from the data required by this Section. From the sum of these two products there shall be deducted the amount of all payments made on account or in consequence of said injuries reported within eighteen months, this amount to be taken as of the date at which the statement is made. A sum not less than the amount remaining after this deduction shall be charged as a liability for outstanding losses to liability companies covered by the provisions of this paragraph. The average cost for suits and for injured persons required by this paragraph shall, on or before the first day of December of each year, be furnished by the Insurance Commissioner to every such company which has not had an experience of ten years in liability underwriting. Besides the reserve provided for in this Section each such company shall be charged as a liability with all unpaid losses of which the company received notice on or before December 31st, and all other debts and liabilities. If the capital stock of any such company computing its liabilities in accordance with the provisions of this Section shall be at any time impaired to the extent of twenty per cent thereof it shall be the duty of the Commissioner of Insurance and Banking to give notice to the company to make good its whole capital stock within sixty days and if this is not done he shall require the company to cease to do business within this State, and shall thereupon in case the company is organized under the authority of the State, immediately institute legal proceedings to wind up the affairs of such company. The Commissioner of Insurance and Banking, in calculating the reserve liability of any such company, may accept the certificate of the officer of any other state charged with the duty of supervising such company, as to any such company organized under the laws of such state; provided, such certificate shows that such liability has been computed in accordance with the provisions of this Section.

SEC. 55. All the provisions of the laws of this State applicable to life, fire, marine, inland, lightning, or tornado insurance companies shall, so far as the same are applicable, govern and apply to all companies transacting any other kind of insurance business in this State, so far as they are not in conflict with provisions of law made specially applicable.

thereto.

SEC. 56. Companies may be incorporated in the manner prescribed by this Act for the incorporation of life, accident and health insurance companies generally, which shall have power only to transact business within the State of Texas, and to write insurance only on the weekly or monthly premiums plan, and to issue no policy promising to pay more. than one thousand dollars in the event of the death of the insured from natural causes, nor more than two thousand dollars in the event of death of any person from accidental causes, which may issue, combined or separately, life, accident or health insurance policies with not less than an actual paid up capital of twenty-five thousand dollars; provided, that all such companies shall be subject to all the laws regulating life insurance companies in this State not inconsistent with the provisions of this Section; and provided, further, that such companies shall not be permitted to invest their assets in other than Texas securities as defined by the laws of this State regulating the investments of life insurance companies.