            THEATTORNEY                 GENERAL
                           OF’ TEXAS




Hon. John Osorio, Chairman
Board of Insurance Commissioners
International  Life Building
Austin, Texas
                     Opinion NO. W-56
                     Re:   Whether a county mutual Insurance
                           company may write insurance on
                           risks in states other than Texas?
Dear Mr. Osorio:
            You have requested   our opinion   on the following
question:
           Way a county mutual insurance comfiany
     write insurance on risks in states other than
     Texas? It
           In your opinion request you have called our atten-
tion to Article  17.16 of the Insurance Code. This section
of the Code was formerly Article 486Oa-20, Section 15, Ver-
non’s Civil Statutes,   Acts 1937, 45th Legislature, page 184,
chapter 99, paragraph 15.    The statute then read as follows:
           “A county mutual insurance company may
     write insurance (a) in any county adjoining
     the county in and for which it is organized,
     or (b) in any county in which no county mu-
     tual insurance company has been organized,
     or (c) anvwhere, if its reserve fund or pol-
     icyholders    contingent liability,  or both such
     reserve fund and contingent liability     taken
     together,    exceed the sum of Fifty Thousand
     ($50,000.00)    Dollars.f’  (Emphasis supplied).
           The identical   question you have propounded to us
was the matter of Attorney General’s Opinion No. T-729,     dated
December 9, 1948, wherein it was concluded that a county mu-
tual insurance company with a reserve fund or policyholders
contingent liability,    or both, taken together,  in excess of
. Hon. JohnOsorio   , ‘page ,,2.. f W-56)
                      :
 $50,000~00, might write insurance outside of Texas.              This
 opinion was, of course, based upon the language           of the stat-
 ute as it was at that ,time.      The opinion was bottomed upon
 the use of the word ltanywher’e” In Subsection        (c) + In enact-
 ing the 1951 Code (Acts 1951, ,,~52ndLegislature,        ;chapter 491))
 the Legislature    chose to leave the word, %anywhere,” in Sub-
 section   (cl, and incorporated     what had been’ Section 15,~of Ar-
 title   486Ca-20, Section 15,~,,J$&t,r,,   into ,Jlrt1clgs,~,&7.16   and
 16.07 of the Insurance Code .‘,‘~,.,_,~er,eafta~i.,m,~195$,, the,,Legis-
 lature amended Chapter. 17 of ‘the Insuranc-e, Code.,,“: (Acts 1953.,
 53rd Legislature,     chapters 196,. ‘page 540)•:~‘Th~e:,amendatory
                                                     ,
 statute included a variety of’ changes lPiuiting”t4e          operations
 of county mutuals.      ,AmendedArticle ~17.16prov&dedr
                                                              , ,~
              “A county mutual ,innrance company possessed
       of Ten Thousand ($lO,OO,O.OC) Dollars or more :in
       surplus, as ~pr0vi~ded’i.n Article    lT,ll;~ may%@.te. ~1.’
       insurance ,in any county, adjoining ,the :caurity,,~,~in,~:r~,:..
                                                                      ;’
       and for which it is organized; ‘and, suc4’Qo~~ #ny”
       possessing   as much &Twenty-fire        ThQuaaW P$25,~~
       000 -00) Dollars in such surplus may urlte~-&gtPr+:~ ~..~,
                                            .” G3mp4’+~,,;,+lp+ :, ”

             The amendment made three changes in, ‘the Ithan&&&-
 ing law, i.e.,   \(l) requiring Ten Thousand ($lC@CO;OC) ,Dollars
 or more, in sur’@us to ,wrlte insurance inan ,adjQinihg ,,COunty,
 (2) requiring   Twenty-five    Thousand .~5,~OO’~OO),,Dollars,,surplus
 to write insurance on a state-wide,,basis,      and [3)‘~additioa     of ~,
 the words, “within this State” after the vord l&?&here.“.
             The courts have, declared that ,the’ mere”‘&& that the
 Legislature   enacts an amendment indicates     that it. thereby in-
 tended to change the original     Act by creati
 withdrawing an existing   oki@+ ‘1 Sutherland,
 &&J p* 412; &&ren       vi State, 82 Tex.Cri
 811 11917) ; ,Ameri
 166, 36 S.W.2d~71
             It. is- within the power of ~the Legislature  to prohibit
 the insurance company from do’ing b~s~~~s,,,:MitSi,dd~the: State.   If
 the Legislature     had not intended, by such amendment, to restrict
 the activities     of a county mutual insurance compa@y to doing I_
 business within the State then the,phrase “withimthis        State”




                                                            .,
Hon. John Osorio,   page 3   &%56)


           “The rule is elementary that we must give
     some effect  to changes in the words of legis-
     lative acts, and must also construe their words,
     so as to accomplish the legislative  intent*”
           The language in question contained in the 1953
amendment was not changed by the 1955 amendment of Article
17.16 (Acts 1955, 54th Legislature,  page 413, chapter 117,
paragraph 36).
             In the opinion request you direct our attention
to the provisions     of Article  17.25, Section 1, of the In-
surance Code, which deals with the regulation       of county
mutual insurance companies.       The provisions  of this subsec-
tion do not directly      relate to t-he question you have asked
US¶   and  are not  controlling,  inasmuch as Article   17.16 ’
specifically    deals with the matter of the sphere of opera-
tion.


           A county mutual insurance company may not
     write insurance on risks in states other than
     Texas.
                                     Very truly   yours,


                                     WILL WILSON
                                     Attorney General

                                      i??%G&&g&*
                                     BY
                                       Wallace P. Finfrock
                                       Assistant
WPF:wb
APPROVED:
OPINION COMMITTEE
H. Grady Chandler
         Chairman
