Texas § IN.912.306 - REQUIRED BONDS

§ IN.912.306. REQUIRED BONDS

REQUIRED BONDS. (a) A county mutual insurance company shall obtain a bond for: (1) the officer responsible for handling the funds of the company's members; and (2) all other office employees who may have access to the company's funds. (b) The bonds required under this section must: (1) be with a surety authorized by the department to engage in business in this state; (2) be made payable to the department for the use and benefit of the company's members; and (3) obligate the principal and surety to pay pecuniary losses that the company sustains through an act of fraud, dishonesty, forgery, theft, embezzlement, wrongful abstraction, or wilful misapplication, regardless of whether the act is committed by the officer or employee directly and alone, or in cooperation with another person. (c) A bond under this section must: (1) be in an amount that is at least the greater of $1,000 or the amount of cash assets on hand, but not more than $20,000, if the bond covers the officer; or (2) be in an amount established by the department that is at least $1,000 but not more than $5,000, if the bond covers office employees. (d) One or more persons may recover on a bond under this section until the bond is exhausted. Added by Acts 2001, 77th Leg., ch. 1419, Sec. 1, eff. June 1, 2003.