Texas Insurance Code

§ 425.125 — RISK CONTROL TRANSACTIONS: DEFINITIONS

IN § 425.125Title 4. REGULATION OF SOLVENCY · Part B. RESERVES AND INVESTMENTS · Ch. 425. RESERVES AND INVESTMENTS FOR LIFE INSURANCE · Art. C. AUTHORIZED INVESTMENTS AND TRANSACTIONS FOR CAPITAL STOCK LIFE, HEALTH, AND ACCIDENT INSURERS

Statute text

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In Sections 425.124-425.132:

(1)"Acceptable collateral" means cash, cash equivalents, letters of credit, and direct obligations, or securities that are fully guaranteed as to principal and interest by the United States government.

(2)"Business entity" includes a sole proprietorship, corporation, limited liability company, association, partnership, joint stock company, joint venture, mutual fund, bank, trust, joint tenancy, or other similar form of business organization, regardless of whether organized for profit.

(3)"Cap" means an agreement obligating the seller to make payments to the buyer, with each payment based on the amount by which a reference price or level or the performance or value of one or more underlying interests exceeds a predetermined number that is sometimes called the strike rate or strike price.

(4)"Cash equivalent" means an investment or security that is short-term, highly rated, highly liquid, and readily marketable. The term includes a money market fund described by Section 425.123. For purposes of this subdivision, an investment or security is:

(A)short-term if it has a remaining term to maturity of one year or less; and

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Legislative history

Added by Acts 2005, 79th Leg., Ch. 727 (H.B. 2017), Sec. 1, eff. April 1, 2007.