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AN ACT
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relating to an exemption for certain life insurance companies |
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regarding the valuation of reserves. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 425.073(d), Insurance Code, is amended |
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to read as follows: |
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(d) The valuation manual must specify: |
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(1) the minimum valuation standards for and |
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definitions of the policies or contracts subject to Section |
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425.0535, including: |
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(A) the commissioner's reserve valuation method |
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for life insurance contracts subject to Section 425.0535; |
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(B) the commissioner's annuity reserve valuation |
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method for annuity contracts subject to Section 425.0535; and |
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(C) the minimum reserves for all other policies |
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or contracts subject to Section 425.0535; |
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(2) the policies or contracts that are subject to the |
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requirements of a principle-based valuation under Section 425.074 |
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and the minimum valuation standards consistent with those |
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requirements, including: |
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(A) the requirements for the format of reports to |
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the commissioner under Section 425.074(b)(3), which must include |
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the information necessary to determine if a valuation is |
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appropriate and in compliance with this subchapter; |
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(B) the assumptions prescribed for risks over |
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which the company does not have significant control or influence; |
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and |
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(C) the procedures for corporate governance and |
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oversight of the actuarial function, and a process for appropriate |
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waiver or modification of the procedures; |
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(3) the policies that are not subject to a |
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principle-based valuation under Section 425.074; |
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(4) the data and form of data required under Section |
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425.075, to whom the data must be submitted, and other desired |
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requirements, including requirements concerning data analyses and |
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reporting of analyses; |
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(5) other requirements, including requirements |
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relating to reserve methods, models for measuring risk, generation |
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of economic scenarios, assumptions, margins, use of company |
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experience, disclosure, certification, reports, actuarial opinions |
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and memorandums, transition rules, and internal controls; and |
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(6) an exemption that allows certain [small] companies |
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to value reserves based on an exception from certain requirements |
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of this section and Section 425.074[; however, the premium |
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thresholds for determining whether the exemption applies shall be |
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as follows: |
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[(A) less than $300 million of ordinary life |
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premium; and |
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[(B) less than $600 million of combined ordinary |
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life premiums for a group of life insurers if the company is a |
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member of that group]. |
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SECTION 2. Section 425.073(e), Insurance Code, is repealed. |
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SECTION 3. This Act takes effect September 1, 2023. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I certify that H.B. No. 3673 was passed by the House on April |
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28, 2023, by the following vote: Yeas 135, Nays 9, 2 present, not |
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voting. |
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______________________________ |
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Chief Clerk of the House |
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I certify that H.B. No. 3673 was passed by the Senate on May |
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16, 2023, by the following vote: Yeas 31, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: _____________________ |
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Date |
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_____________________ |
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Governor |