Texas Insurance Code 1154.003 – Definitions
Terms Used In Texas Insurance Code 1154.003
- 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.
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Contract: A legal written agreement that becomes binding when signed.
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
In this chapter:
(1) “Annuity contract” means a contract, including a funding agreement, guaranteed investment contract, and synthetic guaranteed investment contract, issued by a life insurer, with or without a mortality or morbidity contingency, under which:
(A) the owner deposits cash or assets in one or more installments with the life insurer; and
(B) the owner or a beneficiary designated by the owner has a right to receive periodic payments for a specified future term.
(2) “Funding agreement” means a type of annuity contract under which a life insurer:
(A) accepts and accumulates funds, including noncash assets; and
(B) makes one or more payments at a future date in amounts that are not based on mortality or morbidity contingencies.
(3) “Governmental body” means a federal, state, municipal, local, or foreign court, tribunal, governmental department, commission, board, bureau, agency, authority, instrumentality, regulatory body, or quasi-regulatory body.
(4) “Group” means a group to which a group life insurance policy may be issued under Subchapter B, Chapter 1131.
(5) “Group annuity contract” means an annuity contract issued to a group and not an individual.
(6) “Guaranteed investment contract” means a type of annuity contract issued by a life insurer:
(A) that is a funding vehicle typically issued to a retirement plan; and
(B) under which the life insurer accepts a deposit or series of deposits from the purchaser and guarantees to pay a specified interest rate of return on the funds deposited during a specified period.
(7) “Life insurer” means an insurance company authorized to engage in the business of life insurance, including issuing annuity contracts, in this state.
(8) “Synthetic guaranteed investment contract” means a group annuity contract or other agreement issued by a life insurer that, wholly or partly, establishes the life insurer’s obligations by reference to a segregated portfolio of assets that the life insurer does not own.