SECTION 6.406. Financial Projections

(a) A captive insurance company must provide financial projections covering the next four years of operations:

(1) with its application under §6.202 of this title (relating to Captive Insurance Company Certificate of Authority Application Contents and Process);

(2) as required under §6.304(c) of this title (relating to Material Change in the Plan of Operations);

(3) not later than 30 days after a request by the department; and

(4) with its annual report every third year, except as provided in subsection (b) of this section.

(b) The financial projections must be in the format required for the annual report and include the projected:

(1) asset page;

(2) liability, capital, and surplus page;

(3) income statement page; and

(4) cash flow page.

(c) A captive insurance company is not required to submit financial projections under subsection (a)(4) of this section if:

(1) the captive insurance company provides the department with financial projections covering the next four years of operations during the calendar or fiscal year that will be covered by the annual report described in subsection (a)(4) of this section; or

(2) the department waives the requirement in writing.

(d) The captive must note the reason for not including the financial projections in its annual report as requested under subsection (a)(4) of this section.

(e) The department will reassess the captive insurance company's minimum capital and surplus when there is an update to the captive insurance company's projections. The captive insurance company must provide an actuarial opinion on the effect of the change in the projections if requested by the department.

Source Note: The provisions of this §6.406 adopted to be effective April 27, 2014, 39 TexReg 3232