Texas Insurance Code
§ 885.311 — DEFICIENCY PAYMENTS
IN § 885.311Title 6. ORGANIZATION OF INSURERS AND RELATED ENTITIES · Part E. MUTUAL AND FRATERNAL COMPANIES AND RELATED ENTITIES · Ch. 885. FRATERNAL BENEFIT SOCIETIES · Art. G. BENEFITS PROVIDED BY FRATERNAL BENEFIT SOCIETIES
Statute text
View on source(a)A fraternal benefit society shall provide in the fraternal benefit society's laws that if the society's reserves for any class of the society's benefit certificates become impaired, the society's supreme governing body or board of directors may require the certificate holders to pay the society an equitable proportion of the deficiency as determined by the governing body or board. The aggregate assessment for the impaired reserves may not exceed the total amount required to comply with Section 885.408.
(b)If a holder of a benefit certificate does not pay a fraternal benefit society the amount determined under Subsection (a), the holder, in a manner determined by the society, may elect to accept:
(1)the amount determined under Subsection (a) as an indebtedness against the certificate, with the amount drawing interest at a rate that does not exceed the rate specified for a certificate loan under a certificate that has cash value;
(2)a proportionate reduction in the benefits payable under the certificate; or
(3)a combination of the limitations on the certificate described by Subdivisions (1) and (2).
(c)A fraternal benefit society may determine a presumed election for a holder of a benefit certificate under Subsection (b) if the holder fails to make an election.
…
Legislative history
Acts 2019, 86th Leg., R.S., Ch. 762 (H.B. 1251), Sec. 1, eff. September 1, 2019.