Texas Insurance Code 425.053 – Annual Valuation of Reserves for Policies and Contracts Issued Before Operative Date of Valuation Manual
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(a) The department shall annually value or cause to be valued the reserves for all outstanding life insurance policies and annuity and pure endowment contracts of each life insurance company engaged in business in this state issued before the operative date of the valuation manual.
(b) In computing reserves under Subsection (a), the department may use group methods and approximate averages for fractions of a year or otherwise.
Terms Used In Texas Insurance Code 425.053
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- Company: means an entity that:
(A) has written, issued, or reinsured life insurance contracts, accident and health insurance contracts, or deposit-type contracts in this state and has at least one such policy in force or on claim; or
(B) has written, issued, or reinsured life insurance contracts, accident and health insurance contracts, or deposit-type contracts in any state and is required to hold a certificate of authority to write life insurance, accident and health insurance, or deposit-type contracts in this state. See Texas Insurance Code 425.052 - Contract: A legal written agreement that becomes binding when signed.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Life insurance: means contracts that incorporate mortality risk, including annuity and pure endowment contracts, and as may be specified in the valuation manual. See Texas Insurance Code 425.052
- Reserves: means reserve liabilities. See Texas Insurance Code 425.052
- Valuation manual: means the manual of valuation instructions adopted by the commissioner by rule. See Texas Insurance Code 425.052
- Year: means 12 consecutive months. See Texas Government Code 311.005
(c) Instead of valuing the reserves as required by Subsection (a) for a foreign or alien company, the department may accept any valuation made by or for the insurance supervisory official of another state or jurisdiction if the valuation complies with the minimum standard provided by this subchapter.
(d) Except as otherwise provided by this subchapter, policies and contracts issued on or after the operative date of the valuation manual are governed by § 425.0535.
(e) The minimum standards for the valuation of policies and contracts issued before the operative date of the valuation manual are as provided by Sections 425.058 through 425.071 and § 425.072(b), as applicable. Sections 425.072(a), 425.073, and 425.074 do not apply to a policy or contract described by this subsection.