Texas Insurance Code 424.112 – Withdrawals and Distributions
(a) A pool participant must be able to make withdrawals on demand without penalty or other assessment on any business day, and settlement of funds must occur within a reasonable and customary period that does not exceed five business days after a withdrawal.
(b) The pooling agreement must provide that the pool manager shall make a distribution to a pool participant, at the manager’s discretion:
(1) in cash in an amount equal to the fair market value at the time of the distribution of the participant’s pro rata share of each of the pool’s underlying assets;
(2) in kind in an amount equal to a pro rata share of each underlying asset; or
(3) in a combination of cash and in-kind distributions in an amount equal to a pro rata share of each underlying asset.
Terms Used In Texas Insurance Code 424.112
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
(c) A distribution under Subsection (b) must be computed after subtracting all the investment pool’s applicable fees and expenses.