Tex. Ins. Code Section 424.062
Authorized Investments: Certain Obligations of Partnership or Corporation


(a)

Except as provided by this section, an insurer may invest the insurer’s funds in excess of minimum capital and surplus in a stock, bond, debenture, bill of exchange, evidence of indebtedness, other commercial note or bill, or security of any partnership or dividend-paying corporation that:

(1)

is incorporated under the laws of the United States, this state, another state, Canada, or a province of Canada;

(2)

is solvent at the time of the investment; and

(3)

has not defaulted in the payment of any of the partnership’s or corporation’s obligations during the five years preceding the date of the investment.

(b)

Except as provided by Subsection (d), an insurer may invest the insurer’s funds in excess of minimum capital and surplus, and all reserves required by law, in a stock, bond, or debenture of any solvent corporation that is incorporated under the laws of the United States, this state, another state, Canada, or a province of Canada.

(c)

Funds invested under Subsection (a) may not be invested in the stock of an oil, manufacturing, or mercantile corporation unless the corporation has, at the time of the investment:

(1)

a net worth of at least $250,000, if the corporation is organized under the laws of this state; or

(2)

a combined capital, surplus, and undivided profits of at least $2.5 million, if the corporation is not organized under the laws of this state.

(d)

An insurer may not invest the insurer’s funds in:

(1)

the insurer’s own stock or in any stock on account of which the holders or owners of the stock may be liable for an assessment other than taxes; or

(2)

any stock, bond, or other security issued by a corporation with respect to which a majority of the stock having voting powers is directly or indirectly owned by or for the benefit of an officer or director of the insurer, unless the insurer has been in continuous operation for at least five years.
Added by Acts 2005, 79th Leg., Ch. 727 (H.B. 2017), Sec. 1, eff. April 1, 2007.

Source: Section 424.062 — Authorized Investments: Certain Obligations of Partnership or Corporation, https://statutes.­capitol.­texas.­gov/Docs/IN/htm/IN.­424.­htm#424.­062 (accessed Jun. 5, 2024).

424.001
Definitions
424.002
Inapplicability of Certain Law
424.051
General Investment Authority Specified by Law
424.052
Additional General Investment Authority
424.053
Limitation as to Single Issuer or Borrower
424.054
Applicability of Percentage Authorizations and Limitations
424.055
Waiver by Commissioner of Quantitative Limitations
424.056
Written Investment Plan
424.057
Investment Records
424.058
Authorized Investments: Form of Minimum Capital and Surplus
424.059
Authorized Investments: Government Obligations
424.060
Authorized Investments: Stock of National or State Bank
424.061
Authorized Investments: Deposits in Certain Financial Institutions
424.062
Authorized Investments: Certain Obligations of Partnership or Corporation
424.063
Authorized Investments: Mutual Funds
424.064
Authorized Investments: Real Property
424.065
Acting as Real Estate Broker or Salesperson Prohibited
424.066
Authorized Investments: Obligations Secured by Real Property Loans
424.067
Authorized Investments: Transportation Equipment
424.068
Authorized Investments: Investment in Foreign Jurisdiction
424.069
Authorized Investments: Certain Loans
424.070
Authorized Investments: Obligations of Local Governmental Entities
424.071
Authorized Investments: the University of Texas
424.072
Authorized Investments: Bonds Issued, Assumed, or Guaranteed in International Market
424.073
Authorized Investments: Insurer Engaged in Business in Foreign Country
424.074
Other Specifically Authorized Investments
424.075
Authorized Investments: Bond Exchange-traded Funds
424.101
Definitions
424.102
Authority to Invest in Pool
424.103
Investment Pool Requirements and Qualifications
424.104
Authorized Investments for Short-term Investment Pool
424.105
Short-term Investment Pool: Certain Short-term Obligations
424.106
Short-term Investment Pool: Certain Money Market Funds
424.107
Authorized Investments for Authorized Investment Pool
424.108
General Insurer Investment Limitations
424.109
Designation of Pool Manager
424.110
Pool Manager to Maintain Assets
424.111
Pooling Agreement Provisions
424.112
Withdrawals and Distributions
424.113
Investment Pool Records
424.114
Inspection of Records
424.115
Reports of Transactions Between Pool and Participant
424.151
Definitions
424.152
Transactions Authorized
424.153
Period of Transaction
424.154
Cash Requirements
424.155
Collateral Requirements
424.156
Percentage Limitations
424.157
Rules
424.201
Definitions
424.202
Risk Control Transactions Authorized
424.203
Notice of Intent to Engage in Risk Control Transactions Required
424.204
Trading Requirements for Derivative Instruments
424.205
Derivative Use Plan
424.206
Internal Control Procedures
424.207
Ability to Demonstrate Hedging Characteristics and Effectiveness
424.208
Offsetting Transactions
424.209
Inclusion of Counterparty Exposure Amounts
424.210
Oversight by Commissioner
424.211
Authority to Enter into Hedging Transaction
424.212
Authority to Enter into Income Generation Transaction
424.213
Limitation on Sale of Call Option on Assets
424.214
Limitation on Sale of Put Option on Assets
424.215
Limitation on Sale of Call Option on Derivative Instrument
424.216
Limitation on Sale of Cap or Floor
424.217
Authority to Enter Replication Transaction
424.218
Rules

Accessed:
Jun. 5, 2024

§ 424.062’s source at texas​.gov