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Texas Insurance Code - Section 442.351. Reinsurer's Liability

Legal Research Home > Texas Lawyer > Insurance Code > Texas Insurance Code - Section 442.351. Reinsurer's Liability

§ 442.351. REINSURER'S LIABILITY.  (a) If the receiver 
has a claim under an insurance policy covered by reinsurance, the 
liability of the reinsurer to the receiver under the reinsured 
contract may not be reduced because of the delinquency proceeding 
against the delinquent insurer, regardless of any contrary 
provision in the reinsurance contract, unless:
		(1)  the reinsurance contract or other written 
agreement was entered into before the delinquency proceeding, is 
otherwise permitted by law, and specifically provides another payee 
of the reinsurance if the ceding insurer becomes insolvent;  or
		(2)  the assuming insurer, with the consent of the 
direct insured, has assumed in accordance with an assumption 
reinsurance agreement the policy obligations of the ceding insurer:
			(A)  as direct obligations of the assuming insurer 
to the payees under the policy;  and
			(B)  in substitution for the obligations of the 
ceding insurer to the payees.
	(b)  Except as provided by Subsection (a), any reinsurance is 
payable to the receiver under a reinsured contract by the assuming 
insurer on the basis of:
		(1)  an approved claim under Section 442.206;  and                            
		(2)  a claim paid by a guaranty association under 
Chapter 462, 463, or 2602 or by the guaranty association of another 
state.

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

Last modified: August 10, 2007