Texas Insurance Code

§ 425.128 — RISK CONTROL TRANSACTIONS: OVERSIGHT BY COMMISSIONER

IN § 425.128Title 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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(a)An insurance company must be able to demonstrate to the commissioner on request the intended hedging characteristics and continuing effectiveness of a derivative transaction or combination of transactions through:

(1)cash flow testing;

(2)duration analysis; or

(3)other appropriate analysis.

(b)Ten days before entering into an initial hedging transaction, an insurance company shall notify the commissioner in writing that:

(1)the company's board of directors has adopted an investment plan that authorizes hedging transactions; and

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Legislative history

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