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Texas Insurance Code - Section 424.056. Written Investment Plan

Legal Research Home > Texas Lawyer > Insurance Code > Texas Insurance Code - Section 424.056. Written Investment Plan

§ 424.056. WRITTEN INVESTMENT PLAN.  (a) Each insurer's 
board of directors, or, if the insurer does not have a board of 
directors, the corresponding authority designated by the insurer's 
charter, bylaws, or plan of operation, shall adopt a written 
investment plan consistent with the requirements of:
		(1)  this chapter;                                                            
		(2)  Sections 822.204, 822.209, 861.258, and 862.002;  
and                  
		(3)  other statutes governing investments by the 
insurer.                   
	(b)  The investment plan must:                                                 
		(1)  specify the diversification of the insurer's 
investments designed to reduce the risk of large losses, by:
			(A)  broad categories, such as bonds and real 
property loans;              
			(B)  kinds, such as government obligations, 
obligations of business entities, mortgage-backed securities, and 
real property loans on office, retail, industrial, or residential 
properties;
			(C)  quality;                                                                
			(D)  maturity;                                                               
			(E)  type of industry;  and                                                  
			(F)  geographical areas, as to both domestic and 
foreign investments;      
		(2)  balance safety of principal with yield and growth;                       
		(3)  seek a reasonable relationship of assets and 
liabilities as to term and nature;  and
		(4)  be appropriate considering the capital and surplus 
and the business conducted by the insurer.
	(c)  At least annually, the board of directors or 
corresponding authority shall review the adequacy of the investment 
plan and the implementation of the plan.
	(d)  An insurer shall maintain the insurer's investment plan 
in the insurer's principal office and provide the plan to the 
commissioner or the commissioner's designee on request.  The 
commissioner or the commissioner's designee shall maintain the plan 
as a privileged and confidential document.  The plan is not subject 
to public disclosure.

Added by Acts 2005, 79th Leg., ch. 727, § 1, eff. April 1, 2007.           

Last modified: August 11, 2007