Tex. Insurance Code § 424.205
This is the official text of Tex. Insurance Code § 424.205, part of Texas’s Insurance Code — regulates insurance companies and the policies they sell.
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§ 424.205. DERIVATIVE USE PLAN.
Official statutory text
(a) Before an insurer enters into a derivative transaction, the insurer's board of directors must approve a derivative use plan as part of the insurer's investment plan otherwise required by law.
(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 and the assets or liabilities being replicated; and
(3) require compliance with the insurer's internal control procedures established under Section 424.206.
(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 and the assets or liabilities being replicated; and
(3) require compliance with the insurer's internal control procedures established under Section 424.206.
Status: in_force · Read it on the official government site
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