Texas § IN.964.001 - DEFINITIONS

§ IN.964.001. DEFINITIONS

DEFINITIONS. (a) In this chapter: (1) "Affiliated company" or "affiliate" has the meaning assigned by Section 823.003 and includes a parent entity that controls a captive insurance company. (1-a) "Attorney in fact" means a firm or corporation that, under a power of attorney or other appropriate authorization of the attorney in fact, acts for subscribers of a captive exchange by issuing reciprocal or interinsurance contracts. (1-b) "Captive exchange" means a reciprocal or interinsurance exchange formed under this chapter. The term includes the attorney in fact through which a reciprocal or interinsurance contract, as defined by Section 942.001 , is exchanged. (2) "Captive insurance company" means a company that holds a certificate of authority under this chapter to insure the operational risks of the company's affiliates or risks of a controlled unaffiliated business. The term includes a captive exchange. (3) "Captive management company" means an entity providing administrative services to a captive insurance company. (4) "Control" means the power to direct, or cause the direction of, the management and policies of an entity, other than the power that results from an official position with or corporate office held in the entity. The power may be possessed directly or indirectly by any means, including through the ownership of voting securities or by contract, other than a commercial contract for goods or nonmanagement services. (5) "Controlled unaffiliated business" means a person: (A) that is not an affiliate; (B) that has an existing contractual relationship with an affiliate under which the affiliate bears a potential financial loss; and (C) the risks of which are managed by a captive insurance company under Section 964.066 . (6) "Operational risk" means any potential financial loss of an affiliate, except for a loss arising from an insurance policy issued by a captive or insurance affiliate. (7) "Redomestication" means the transfer to or from this state of the insurance domicile of an authorized captive insurer. (8) "Subscriber" means an affiliated company or controlled unaffiliated business that enters into a reciprocal contract of insurance with an attorney in fact as a subscriber of a captive exchange. (b) Notwithstanding Section 30.003 , in this chapter, "person" has the meaning assigned by Section 311.005 , Government Code. Added by Acts 2013, 83rd Leg., R.S., Ch. 569 (S.B. 734 ), Sec. 2, eff. June 14, 2013. Amended by: Acts 2017, 85th Leg., R.S., Ch. 1050 (H.B. 1944 ), Sec. 1.01, eff. June 15, 2017.