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Texas Insurance Code - INS § 846.154. Cash Reserve Requirements

Current as of January 01, 2024 | Updated by Findlaw Staff

(a) The amount of cash reserves recommended under Section 846.153(c)(2) may not be less than the greater of:

(1) 20 percent of the total contributions in the preceding plan year;  or

(2) 20 percent of the total estimated contributions for the current plan year.

(b) Cash reserves required by this section must be:

(1) computed with proper actuarial regard for:

(A) known claims, paid and outstanding;

(B) a history of incurred but not reported claims;

(C) claims handling expenses;

(D) unearned premium;

(E) an estimate for bad debts;

(F) a trend factor;  and

(G) a margin for error;  and

(2) maintained in cash or federally guaranteed obligations of less than five-year maturity that have a fixed or recoverable principal amount or in other investments as the commissioner may authorize by rule.

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Cite this article: FindLaw.com - Texas Insurance Code - INS § 846.154. Cash Reserve Requirements - last updated January 01, 2024 | https://codes.findlaw.com/tx/insurance-code/ins-sect-846-154/

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