Tex. Ins. Code § 2210.056 · Subchapter B. ADMINISTRATION OF ASSOCIATION
USE OF ASSOCIATION ASSETS.
Text — Current through the 89th 2nd Called Legislative Session, 2025
(a) The association's net earnings may not inure, in whole or in part, to the benefit of a private shareholder or individual.
Text of subsection effective until September 01, 2027
(b) The association's assets may not be used for or diverted to any purpose other than to:
(1) satisfy, in whole or in part, the liability of the association on claims made on policies written by the association;
(2) make investments authorized under applicable law;
(3) pay reasonable and necessary administrative expenses incurred in connection with the operation of the association and the processing of claims against the association;
(4) satisfy, in whole or in part, the obligations of the association incurred in connection with Subchapters B-1, B-2, J, M, M-1, and M-2, including reinsurance, financing arrangements, public securities, and financial instruments; or
(5) make remittance under the laws of this state to be used by this state to:
(A) pay claims made on policies written by the association;
(B) purchase reinsurance covering losses under those policies; or
(C) prepare for or mitigate the effects of catastrophic natural events.
Text of subsection effective on September 01, 2027
(b) The association's assets may not be used for or diverted to any purpose other than to:
(1) satisfy, in whole or in part, the liability of the association on claims made on policies written by the association;
(2) make investments authorized under applicable law;
(3) pay reasonable and necessary administrative expenses incurred in connection with the operation of the association and the processing of claims against the association;
(4) satisfy, in whole or in part, the obligations of the association incurred in connection with Subchapters B-2, J, M-1, and M-2, including reinsurance, financing arrangements, and financial instruments; or
(5) make remittance under the laws of this state to be used by this state to:
(A) pay claims made on policies written by the association;
(B) purchase reinsurance covering losses under those policies; or
(C) prepare for or mitigate the effects of catastrophic natural events.
Text of subsection effective until September 01, 2027
(c) On dissolution of the association, all assets of the association, other than assets pledged for the repayment of public securities issued under this chapter, revert to this state.
Text of subsection effective on September 01, 2027
(c) On dissolution of the association, all assets of the association, other than assets pledged for the repayment of financial arrangements entered into under this chapter, revert to this state.
Notes and commentary — not statutory text
History
Added by Acts 2005, 79th Leg., Ch. 727 (H.B. 2017), Sec. 2, eff. April 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1408 (H.B. 4409), Sec. 14, eff. June 19, 2009.
Acts 2011, 82nd Leg., 1st C.S., Ch. 2 (H.B. 3), Sec. 8, eff. September 28, 2011.
Acts 2025, 89th Leg., R.S., Ch. 895 (H.B. 3689), Sec. 2.02(a), eff. September 1, 2025.
Acts 2025, 89th Leg., R.S., Ch. 895 (H.B. 3689), Sec. 2.02(b), eff. September 1, 2027.
Source of truth
- Edition
- Current through the 89th 2nd Called Legislative Session, 2025
- Official file
- https://statutes.capitol.texas.gov/Docs/IN/htm/IN.2210.htm
- Text hash
- sha256 db9cf125159b929b82b1817d55ead5053176559cbcab5ba76363e11dff379013
- Composed by
- compose_tx.py 2026-10-05: the Legislative Council's chapter files read in document order; verify_tx.py's independent reading (lxml DOM walk) agrees character for character
Procedural information only. Not legal advice and not a substitute for the advice of an attorney. Confirm the current text with the official publisher before relying on it.