-




                THEATIY~RNEY               GENERAL
                           OFTEXAS




    Honorable George B. Butler, Chalrman
    Board of Insurance Commissioners
    Austin 14, Texas
    Dear Sir:                  Opinion NO. O-6995
                               Re: Whether the purpose clause of the
                                    Reserve Loan Life Insurance Corn-
                                    pang of Texas is sufficient to en-
                                    able it to write workmen's compen-
                                    sation insurance and a related
                                    question.
           Your request foran o inion of this department, by
    letter dated December 14, 19t5, presents the following ques-
    tions:
           "In view of letter opinlons from your Department
        of March 16, 1938 and December 6, 1938, copies of which
        are attached for your ready reference, we assume that
        a life, health and accident-company incorporated un-
        der Chapter 3, Title 78 may, with appropriate purpose
        clause in its chapter, write workmen's compensation
        insurance. Please confirm or correct me as to this.
           "If you answer to the foregoing is in the affir-
        mative, please advise me whether the following'pur-
        pose clause of Reserve Loan Life Insurance Company of
        Texas is sufficient to enable it to write workmen's
        compensation insurance:
           "'The purpose for which this corporation Fs
        formed is to engag~ein the buslness of life, health
        and accident insurance, as authorlzed'by Chapter 3,
        Title 78 o+fih+"flT;isedCivil Statutes of the State
        of Texas.
           Insurance companies incorporated under Chapter 3, Title
    78, Revised Civil Statutes, are authorized for the purpose of
    forming a life, health, and accident insuranc'ecompany. Article
    4717, Revised Civil Statutes. The only expressed limitation
    found under Chapter 3, Title 78 limiting the kind of Insurance
    business to be written by a life, health, and accident Insurance
    company is contained In Article 4738, adopted from an act of
    1909, which Article provrdes:
                                                                  -   .




Honorable George B. Butler, page 2        o-6995


     -~ "It shall be unlawful for any life insurance com-
    pany, accident insurance company, life and accident,
    health and accident, and life, health and accident ln-
    surance company to take any kind of risks or is&e any
    policies of insurance, except those of life, accident
    or health; nor shall the business of life, accident or
    health Insurance in this State be in any wise conduct-
    ed or transacted by any company which in this or any
    other State or country, is engaged or concern? in the
    business of marine, fire, or inland Insurance.
       In 1917, the Thirty-fifth Legislature, Chapter~l03, en-
acted the Workmen's Compensation Law, Title 130, Revised.Civll
Statutes, providing in part 4, Section 2, (Art. 8309, Sectlon
2, R.C.S.), as follows:
       "Any insurance company, which term shall Include
    mutual and reciprocal companies, lawfully transacting a
    liability or accident business In this State shall
    have the same right to Insure the llabilitg and pay
    the compensation provided for'in part 1 of this law
    and when such company issues a policy conditioned to
    pay such compensation, the holder of such policy sha~ll
    be regarded as a subscriber so far as applicable uh-
    der this law, and when such company Insures such pay-
    ment of compensation it shall be subject to the pro- -'
    vlslons of parts 1, 2 and 4 and of sectlbns 10, 17, 18a
    and 21 of part 3 of this law. Such company may have-and
    exercise all of the rights and powersconferred by this
    law on the association created hereby, but such rights
    and powers shall not be exercised by a mutual orere-
    clprocal organization unless su,chorganization hasat
    least fifty subscribers who have not less than 2,000
    employes."'
       The term "acc~identbusiness' as used In the foregoj.ng
statute,ls broad, and it is not believed the Legislature, in
designating a company by its insurance business, usedthe word
in a limited or quallfglng sense, that is, confined to strictly
contracts of Indemnity. Nowhere In the statutes do we find
any definition of "liability" insurance~~or"accident" Insur-
ance. Article 4716 specifies the kind and characterof ac-
EdFdentinsurance business sufficient to denominate a company
an accident insurance company, viz:  "doing business under
any charter involving the payment of money or other thing of
value, conditioned upon the injury, disablement or death of
persons resulting from travel or general accidents by land or
water."
       It Is therefore the opinion of this department that
Honorable George B. Butler, page 3            0 -6995


such companies as the one in questlon, incorporated under
Chapter 3, Title 78, Revised Civil Statutes, lawfully doing
an accident Insurance buslness, may, by appropriate amendment
to Its charter, write workmen's compensation insurance.
       As to the purpose clause of the company quoted in yoUr
letter and hereinabove set forth, It is our opinion that same
is insufficient~to atithbrlzesuch company to write-workmen's
compensation insurance as provided under Title 130, V.A.C.S.
       We have reviewed the documentary copies attached to
your request, dated March 1.6and December 6, 1938, referred to
by you as letter opinions. The former relates solely to a
tax question, stating reasons for compromising a tax suit irr-
volvlng a'reciprocal exchange. The letter oplnlon of Decem-
ber 6, 1938, ijertaltis
                      solely to a company operating under the
Lloyd's Plan and was written in response to an fnquiry as to
what kind of Insurance ,Fs includea within the terms "lleb'~llty'~
insurance", Article 5015, Sudblvlslon 3, RbvIsed Civil Statutes.
These insttiments do not relate to or effect the above ques-
tions propounded; consequently we find It unnecessary to dls-
cuss them.
       This opfnion Is not to be construed as applicable ,to
limited capital stock companies authorized under Article 4752,
R.C.S.
                                     Yours   very truly
                              ATTORNEY QEIPERALOF TEXAS
                                     By s/urn.J. R. King
                                          Wm. J:'R. King
                                          Assistant
WJRK/JCP/wc

APPROVED JAN 25 1946
s/Grover Sellers
ATTORNEY GENERAL OF TEXAS
Approved opinion Commfttee By sdswB Chairmen
