28 Tex. Admin. Code § 5.4161 - Member Assessments Other than Assessments for Reinsurance in Excess of the Association's Statutory Minimum Funding Level
(a) The association, with the approval of the
Commissioner, must assess members as provided by Insurance Code Chapter
2210.
(b) The association must
provide, in the aggregate for the catastrophe year, the following information
when requesting the Commissioner to approve a class 1, class 2, or class 3
assessment under Insurance Code §§
2210.0725,
2210.074, or
2210.0742, as
applicable:
(1) the association's best
estimate of the amount of losses expected to be paid as a result of the event,
or series of events, that caused the need for the assessment
requested;
(2) the amount of losses
paid, or expected to be paid, from premium and other revenue of the
association;
(3) the amount of
losses paid, or expected to be paid, from available reserves of the association
and available amounts in the CRTF;
(4) the amount of losses paid, or expected to
be paid, from the proceeds of class 1 public securities issued, or expected to
be issued;
(5) the amount of class
1 assessments previously approved and the amount of class 1 assessments now
requested;
(6) in the case of a
request to approve a class 2 or class 3 assessment, the amount of losses paid,
or expected to be paid, from the proceeds of class 2 public securities issued,
or expected to be issued;
(7) in
the case of a request to approve a class 2 or class 3 assessment, the amount of
class 2 assessments previously approved and the amount of class 2 assessments
now requested;
(8) in the case of a
request to approve a class 3 assessment, the amount of losses paid, or expected
to be paid, from the proceeds of class 3 public securities issued, or expected
to be issued;
(9) in the case of a
request to approve a class 3 assessment, the amount of class 3 assessments
previously approved and the amount of class 3 assessments now
requested.
(c) If all or
any portion of the authorized principal amount of class 1 public securities
requested under §
5.4124 or §
5.4125 of this title (relating to
Issuance of Class 1 Public Securities before a Catastrophic Event and Issuance
of Public Securities after a Catastrophic Event) cannot be issued based on the
factors described in §
5.4135 of this title (relating to
Marketable Public Securities; the Amount of Class 1 Public Securities that
Cannot be Issued; Market Conditions and Requirements; and Cost-Benefit
Analysis), the association may request and the Commissioner may approve the
imposition of class 1 assessments as provided in this section.
(d) In its request to the Commissioner to
approve the imposition of assessments under subsection (c) of this section, the
association must submit the following information:
(1) the information required by subsection
(b) of this section;
(2)
information based on the analyses described in §
5.4135 of this title;
(3) the amount of class 1 public securities
that can be issued;
(4) the amount
of class 1 public securities that cannot be issued; and
(5) the specific reasons, market conditions,
and requirements that prevent TPFA from issuing all or any portion of the
authorized principal amount of class 1 public securities. The association may
rely on information and advice provided by TPFA, TPFA consultants, TPFA legal
counsel, and third parties retained by the association for this
purpose.
(e) The
association must request the issuance of the statutorily authorized principal
amount of class 1 public securities before the association may request the
Commissioner approve a class 1 assessment under Insurance Code §
2210.0725.
(f) The association must request the issuance
of the statutorily authorized principal amount of class 2 public securities
before the association may request the Commissioner approve a class 2
assessment under Insurance Code §
2210.074.
(g) The association must request the issuance
of the statutorily authorized principal amount of class 3 public securities
before the association may request the Commissioner approve a class 3
assessment under Insurance Code §
2210.0742.
(h) If the Commissioner approves the
imposition of assessments under subsection (c) of this section, any class 2 and
class 3 public securities must be issued as provided by Insurance Code Chapter
2210 and these rules.
(i) The
association may use the proceeds from assessments only for losses and expenses
resulting from the catastrophe year for which the assessments were
made.
Notes
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