Texas Administrative Code
Title 28 - INSURANCE
Part 1 - TEXAS DEPARTMENT OF INSURANCE
Chapter 5 - PROPERTY AND CASUALTY INSURANCE
Subchapter E - TEXAS WINDSTORM INSURANCE ASSOCIATION
Division 3 - LOSS FUNDING, INCLUDING CATASTROPHE RESERVE TRUST FUND, FINANCING ARRANGEMENTS, AND PUBLIC SECURITIES
Section 5.4124 - Issuance of Class 1 Public Securities before a Catastrophic Event
Current through Reg. 50, No. 13; March 28, 2025
(a) The association's board of directors may request that TPFA issue class 1 public securities before a catastrophic event, if the association's board of directors determines that class 1 public security proceeds may become necessary and the commissioner approves the request.
(b) The association must submit its board of directors' written request under subsection (a) of this section to the commissioner. The request must include the following information:
(c) The association may make one or more requests under this section.
(d) The association may request class 1 public securities up to an aggregate principal amount not to exceed $500 million outstanding at any one time, regardless of the calendar year or years in which the securities are issued, except that class 1 public securities that are issued before a catastrophic event, including the proceeds of any outstanding class 1 public securities issued on or before June 1, 2015, and that have been depleted to pay for the association program will not continue to count against the combined $500 million aggregate limit described in this subsection. This section does not authorize the association to request class 1 public securities in an amount in excess of the catastrophe year limit prescribed in § 5.4125(c) of this division (relating to Issuance of Public Securities after a Catastrophic Event).
(e) For the purposes of determining the authorized amount of class 1 public securities, public security proceeds used to pay for public security issuance costs, establish a public security reserve fund, capitalize interest, or provide for contractual coverage amounts, are considered depleted in the same catastrophe year as, and in proportion to, the public security proceeds used to pay for losses or operating expenses, or used to pay principal on the public securities.