Texas Insurance Code

§ 425.129 — RISK CONTROL TRANSACTIONS: LIMITATIONS ON INCOME GENERATION TRANSACTIONS

IN § 425.129Title 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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An insurance company may enter into an income generation transaction only if:

(1)as a result of and after making the transaction, the sum of the following amounts does not exceed 10 percent of the company's assets:

(A)the aggregate statement value of admitted assets that at the time of the transaction are subject to call or that generate the cash flows for payments the company is required to make under caps and floors sold by the company and that at the time of the transaction are outstanding under Sections 425.124-425.132;

(B)the statement value of admitted assets underlying derivative instruments that at the time of the transaction are subject to calls sold by the company and outstanding under those sections; and

(C)the purchase price of assets subject to puts that at the time of the transaction are outstanding under those sections; and

(2)the transaction is one of the following types, is covered in the manner specified by this subdivision, and meets the other requirements of this subdivision:

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Legislative history

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