Tex.
Ins. Code Section 424.075
Authorized Investments: Bond Exchange-traded Funds
(a)
An insurer may invest the insurer’s funds in excess of minimum capital and surplus in shares of a bond exchange-traded fund registered under the Investment Company Act of 1940 (15 U.S.C. Section 80a-1 et seq.), as amended, if:(1)
the exchange-traded fund is solvent and reported at least $100 million of net assets in the exchange-traded fund’s latest annual or more recent certified audited financial statement;(2)
the securities valuation office has designated the exchange-traded fund as meeting the criteria to be placed on the list promulgated by the securities valuation office of exchange-traded funds eligible for reporting as a long-term bond in the Purposes and Procedures Manual of the securities valuation office or a successor publication; and(3)
the amount of the insurer’s investment in the exchange-traded fund does not exceed 15 percent of the insurer’s capital and surplus.(b)
This section does not authorize an insurer to invest in a bond exchange-traded fund that has:(1)
embedded structural features designed to deliver performance that does not track the full unlevered and positive return of the underlying index or exposure, including a leveraged or inverse exchange-traded fund; or(2)
an expense ratio in excess of 100 basis points.(c)
An insurer may deposit with the department shares of a bond exchange-traded fund described by Subsection (a) as a statutory deposit if state law requires a statutory deposit from the insurer.
Source:
Section 424.075 — Authorized Investments: Bond Exchange-traded Funds, https://statutes.capitol.texas.gov/Docs/IN/htm/IN.424.htm#424.075 (accessed Jun. 5, 2024).
