Tex.
Ins. Code Section 422.005
Exemptions
(a)
This chapter does not apply to:(1)
variable contracts for which separate accounts are required to be maintained;(2)
a reinsurance agreement and any trust account related to the reinsurance agreement if the reinsurance agreement and related trust account meet the requirements of Chapter 493 (Authorized Reinsurance; Credit and Accounting);(3)
an assessment-as-needed company or insurance coverage written by an assessment-as-needed company;(4)
an insurer while:(A)
the insurer is subject to a conservatorship order issued by the commissioner; or(B)
a court-appointed receiver is in charge of the insurer’s affairs;(5)
an insurer’s reserve assets that are held, deposited, pledged, or otherwise encumbered to secure, offset, protect, or meet the insurer’s policy reserve liabilities established in a reinsurance agreement under which the insurer reinsures the insurance policy liabilities of a ceding insurer if:(A)
the ceding insurer and the reinsurer are authorized to engage in business in this state; and(B)
in accordance with a written agreement between the ceding insurer and the reinsurer, reserve assets substantially equal to the policy reserve liabilities the reinsurer must establish on the reinsured business are:(i)
deposited by or withheld from the reinsurer and held in the custody of the ceding insurer, or deposited and held in a trust account with a state or national bank domiciled in this state, as security for the payment of the reinsurer’s obligations under the reinsurance agreement;(ii)
held subject to withdrawal by the ceding insurer; and(iii)
held under the separate or joint control of the ceding insurer; or(6)
any pledge, encumbrance, or lien contemplated by or customarily included in the documentation for:(A)
an investment or transaction authorized by:(i)
Section 424.068 (Authorized Investments: Investment in Foreign Jurisdiction), Subchapter D (Definitions), Chapter 424 (Investments for Certain Insurers), or Section 425.121 (Authorized Investments: Securities Lending, Repurchase, Reverse Repurchase, and Dollar Roll Transactions) or 425.151 (Authorized Investments: Foreign Countries and United States Territories); or(ii)
Section 424.068 (Authorized Investments: Investment in Foreign Jurisdiction), Subchapter E (Definitions), Chapter 424 (Investments for Certain Insurers), or Section 425.124 (Authorized Investments: Risk Control Transactions), 425.125 (Risk Control Transactions: Definitions), 425.126 (Risk Control Transactions: Derivative Use Plan), 425.127 (Risk Control Transactions: Internal Control Procedures), 425.128 (Risk Control Transactions: Oversight by Commissioner), 425.129 (Risk Control Transactions: Limitations on Income Generation Transactions), 425.130 (Risk Control Transactions: Limitations on Replication Transactions), 425.131 (Risk Control Transactions: Trading Requirements), or 425.132 (Risk Control Transactions: Offsetting Transactions); and(B)
a custodial or trust agreement for an insurer’s securities authorized by Section 423.103 (Securities Held Under Custodial or Trust Agreement) that provides for a limited grant or lien or security interest for payment of fees and expenses due to a service provider or intermediary under the custodial or trust agreement.(b)
Notwithstanding this section, the commissioner may examine any asset, reinsurance agreement, or deposit arrangement described by Subsection (a)(5) at any time, in accordance with the commissioner’s authority under this code to examine an insurer.
Source:
Section 422.005 — Exemptions, https://statutes.capitol.texas.gov/Docs/IN/htm/IN.422.htm#422.005 (accessed Jun. 5, 2024).
