(a) Subject to Subsections (b) and (c), this subtitle may not be construed to prohibit an insurance company, including the Texas Mutual Insurance Company, from issuing participating policies.
(b) A policyholder dividend under a workers’ compensation insurance policy:
(1) must be approved by the department if the insurer’s policyholder dividend amount exceeds 10 percent of surplus; and
(2) may not be approved by the department until the insurance company has adequate reserves.

(c) For purposes of Subsection (b), reserves must be computed on the same basis for all classes of insurance companies operating under this subtitle and Section 2051.002.
(d) An insurer must notify the department in writing of a distribution if the insurer’s policyholder dividend amount is not greater than 10 percent of surplus.