(a) An insurance company writing fire insurance in this state shall maintain reinsurance or unearned premium reserves on its policies in force.
(b) The commissioner may require that reserves required by Subsection (a) equal the unearned portions of the gross premiums in force after deducting reinsurance under Section 862.101, as computed on each respective risk from the policy’s date of issue.

(c) If the commissioner does not impose a requirement under Subsection (b), the portions of the gross premium in force held as reinsurance or unearned premium reserves after deducting reinsurance under Section 862.101 shall be computed as follows:

Term for Which Policy Was Written		Reserve for Unearned Premium
1 year or less		1/2
2 years		1st year 3/4
		2nd year 1/4
3 years		1st year 5/6
		2nd year 1/2
		3rd year 1/6
4 years		1st year 7/8
		2nd year 5/8
		3rd year 3/8
		4th year 1/8
5 years		1st year 9/10
		2nd year 7/10
		3rd year 1/2
		4th year 3/10
		5th year 1/10
More than 5 years		pro rata

(d)  Notwithstanding Subsection (c), an insurance company may compute, or the commissioner may require an insurance company to compute, the reserves on a quarterly, monthly, or more frequent pro rata basis.
(e)  An insurance company that adopts a method for computing the reserve may not adopt another method without commissioner approval.