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Texas Insurance Code - Section 463.203. Policies And Contracts Excluded

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§ 463.203. POLICIES AND CONTRACTS EXCLUDED.  (a) In this 
section, " Moody's Corporate Bond Yield Average" means the monthly 
average corporates as published by Moody's Investors Service, Inc., 
or any successor to that entity.
	(b)  This chapter does not provide coverage for:                               
		(1)  any part of a policy or contract not guaranteed by 
the insurer or under which the risk is borne by the policy or 
contract holder;
		(2)  a policy or contract of reinsurance, unless an 
assumption certificate has been issued;
		(3)  any part of a policy or contract to the extent that 
the rate of interest on which that part is based:
			(A)  as averaged over the period of four years 
before the date the association became obligated with respect to 
the policy or contract, exceeds a rate of interest determined by 
subtracting two percentage points from Moody's Corporate Bond Yield 
Average averaged for the same four-year period or for a lesser 
period if the policy or contract was issued less than four years 
before the date the association became obligated;  and
			(B)  on and after the date the association became 
obligated with respect to the policy or contract, exceeds the rate 
of interest determined by subtracting three percentage points from 
Moody's Corporate Bond Yield Average as most recently available;
		(4)  a plan or program of an employer, association, or 
similar entity to provide life, health, or annuity benefits to the 
entity's employees or members to the extent that the plan or program 
is self-funded or uninsured, including benefits payable by an 
employer, association, or similar entity under:
			(A)  a multiple employer welfare arrangement as 
defined by Section 3, Employee Retirement Income Security Act of 
1974 (29 U.S.C. Section 1002);
			(B)  a minimum premium group insurance plan;                                 
			(C)  a stop-loss group insurance plan;  or                                   
			(D)  an administrative services-only contract;                               
		(5)  any part of a policy or contract to the extent that 
the part provides dividends or experience rating credits or 
provides that fees or allowances be paid to any person, including 
the policy or contract holder, in connection with the service to or 
administration of the policy or contract;
		(6)  a policy or contract issued in this state by a 
member insurer at a time the insurer was not authorized to issue the 
policy or contract in this state;
		(7)  an unallocated annuity contract issued to an 
employee benefit plan protected under the federal Pension Benefit 
Guaranty Corporation;
		(8)  any part of an unallocated annuity contract that 
is not issued to or in connection with a specific employee, a 
benefit plan for a union or association of individuals, or a 
governmental lottery;  or
		(9)  any part of a financial guarantee, funding 
agreement, or guaranteed investment contract that:
			(A)  does not contain a mortality guarantee;  and                            
			(B)  is not issued to or in connection with a 
specific employee, a benefit plan, or a governmental lottery.

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

Last modified: August 11, 2007