Texas Insurance Code 425.126 – Risk Control Transactions: Derivative Use Plan
Current as of: 2024 | Check for updates
|
Other versions
(a) Before an insurance company enters into a derivative transaction, the company’s board of directors must approve a derivative use plan as part of the investment plan required by § 425.105.
(b) The derivative use plan must:
(1) describe investment objectives and risk constraints, such as counterparty exposure amounts;
(2) define permissible transactions identifying the risks to be hedged or the assets or liabilities being replicated; and
(3) require compliance with internal control procedures.
Terms Used In Texas Insurance Code 425.126
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.