(a) As a condition to authorizing periodic payments of future damages, the court shall require a defendant who is not adequately insured to provide evidence of financial responsibility in an amount adequate to assure full payment of damages awarded by the judgment.
(b) The judgment must provide for payments to be funded by:
(1) an annuity contract issued by a company licensed to do business as an insurance company, including an assignment within the meaning of Section 130, Internal Revenue Code of 1986, as amended;
(2) an obligation of the United States;
(3) applicable and collectible liability insurance from one or more qualified insurers; or
(4) any other satisfactory form of funding approved by the court.

Terms Used In Texas Civil Practice and Remedies Code 74.505

  • Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
  • Contract: A legal written agreement that becomes binding when signed.
  • Court: means any federal or state court. See Texas Civil Practice and Remedies Code 74.001
  • Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
  • Defendant: In a civil suit, the person complained against; in a criminal case, the person accused of the crime.
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • United States: includes a department, bureau, or other agency of the United States of America. See Texas Government Code 311.005

(c) On termination of periodic payments of future damages, the court shall order the return of the security, or as much as remains, to the defendant.

  Previous section
Next section  
 Subchapter K Contents