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Texas Insurance Code - Section 424.064. Authorized Investments: Real Property

Legal Research Home > Texas Lawyer > Insurance Code > Texas Insurance Code - Section 424.064. Authorized Investments: Real Property

§ 424.064. AUTHORIZED INVESTMENTS:  REAL PROPERTY.  (a) 
Subject to this section, an insurer may invest the insurer's funds 
in excess of minimum capital and surplus in real property to the 
extent authorized by other provisions of this code.
	(b)  An insurer with admitted assets of more than $500 
million may own investment real property other than real property 
authorized by another provision of this code, or participations in 
that other investment real property, if the property is materially 
enhanced in value by:
		(1)  the construction of durable, permanent-type 
buildings and other improvements that cost an amount at least equal 
to the cost of the real property, excluding buildings and 
improvements at the time the property is acquired;  or
		(2)  the construction, commenced before the second 
anniversary of the date the real property is acquired, of buildings 
and improvements described by Subdivision (1).
	(c)  The amount invested by an insurer in a single investment 
real property and improvements, or in any interest in real property 
and improvements, may not exceed five percent of the insurer's 
admitted assets in excess of $500 million.  The total amount 
invested by an insurer in investment real property and improvements 
may not exceed 15 percent of the insurer's admitted assets in excess 
of $500 million.
	(d)  Except as provided by Section 862.002, an insurer may 
not own, develop, or hold an equity interest in any residential 
property or subdivision, single or multiunit family dwelling 
property, or undeveloped real property to subdivide for or develop 
residential, single or multiunit family dwellings.
	(e)  The investment authority granted by this section is in 
addition to and separate from the investment authority granted by 
Section 862.002, except that an insurer may not invest in any real 
property that, when added to properties acquired by the insurer 
under Section 862.002, would exceed the limitations prescribed by 
that section.
	(f)  An insurer's admitted assets are determined from the 
insurer's annual statements that are made as of the December 31 that 
precedes the date of the determination and are filed with the 
department as required by law.  The value of any investment made 
under this section is subject to the appraisal requirement of 
Section 862.002.

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

Last modified: August 11, 2007