Texas Statutes
Subchapter D. Powers and Duties of Multiple Employer Welfare Arrangements
Section 846.154. Cash Reserve Requirements

Sec. 846.154. CASH RESERVE REQUIREMENTS. (a) The amount of cash reserves recommended under Section 846.153(c)(2) may not be less than the greater of:
(1) 20 percent of the total contributions in the preceding plan year; or
(2) 20 percent of the total estimated contributions for the current plan year.
(b) Cash reserves required by this section must be:
(1) computed with proper actuarial regard for:
(A) known claims, paid and outstanding;
(B) a history of incurred but not reported claims;
(C) claims handling expenses;
(D) unearned premium;
(E) an estimate for bad debts;
(F) a trend factor; and
(G) a margin for error; and
(2) maintained in cash or federally guaranteed obligations of less than five-year maturity that have a fixed or recoverable principal amount or in other investments as the commissioner may authorize by rule.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 1, eff. June 1, 2003.