# Tex. Insurance Code § 823.008: STANDARD FOR DETERMINING SURPLUS REASONABLENESS AND ADEQUACY

> Texas · Statutes · In force

URL: https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.008

## Section

- **Citation:** Tex. Insurance Code § 823.008
- **Heading:** STANDARD FOR DETERMINING SURPLUS REASONABLENESS AND ADEQUACY
- **Jurisdiction:** Texas
- **Kind:** Statutes
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** TX Code / Code in / Chapter 823 / Section 823.008

## Text

(a) In determining whether an insurer's policyholders' surplus is reasonable in relation to the insurer's outstanding liabilities and adequate to the insurer's financial needs, the following factors, among others, shall be considered:

(1) the size of the insurer as measured by its assets, capital and surplus, reserves, premium writings, insurance in force, and other appropriate criteria;

(2) the extent to which the insurer's business is diversified among the different lines of insurance;

(3) the number and size of risks insured in each line of insurance;

(4) the extent of the geographical dispersion of the insurer's insured risks;

(5) the nature and extent of the insurer's reinsurance program;

(6) the quality, diversification, and liquidity of the insurer's investment portfolio;

(7) the recent past and projected future trend in the size of the insurer's:

(A) policyholders' surplus; and

(B) investment portfolio;

(8) the policyholders' surplus maintained by comparable insurers;

(9) the adequacy of the insurer's reserves;

(10) the quality and liquidity of investments in subsidiaries made under Subchapter F; and

(11) the quality of the insurer's earnings and the extent to which the insurer's reported earnings include extraordinary items.

(b) The commissioner may treat an investment described by Subsection (a)(10) as a nonadmitted or disallowed asset for purposes of Subsection (a) if in the commissioner's judgment the investment justifies that treatment.

## Nearby sections

- [Tex. Insurance Code § 823.001 § 823.001. FINDINGS AND PURPOSE.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.001.md)
- [Tex. Insurance Code § 823.002 § 823.002. DEFINITIONS.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.002.md)
- [Tex. Insurance Code § 823.003 § 823.003. CLASSIFICATION AS AFFILIATE OR SUBSIDIARY.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.003.md)
- [Tex. Insurance Code § 823.004 § 823.004. CLASSIFICATION AS COMMERCIALLY DOMICILED INSURER.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.004.md)
- [Tex. Insurance Code § 823.005 § 823.005. DESCRIPTION OF CONTROL; DETERMINATION OF CONTROL.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.005.md)
- [Tex. Insurance Code § 823.006 § 823.006. DESCRIPTION OF INSURANCE HOLDING COMPANY SYSTEM.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.006.md)
- [Tex. Insurance Code § 823.007 § 823.007. DESCRIPTION OF VOTING SECURITY.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.007.md)
- [Tex. Insurance Code § 823.008 § 823.008. STANDARD FOR DETERMINING SURPLUS REASONABLENESS AND ADEQUACY.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.008.md)
- [Tex. Insurance Code § 823.009 § 823.009. SITUS OF SECURITIES OF DOMESTIC INSURER.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.009.md)
- [Tex. Insurance Code § 823.010 § 823.010. DISCLAIMER OF AFFILIATION.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.010.md)
- [Tex. Insurance Code § 823.011 § 823.011. CONFIDENTIALITY OF INFORMATION.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.011.md)
- [Tex. Insurance Code § 823.012 § 823.012. RULES; PROCEDURES FOR CONSIDERING CERTAIN DISTRIBUTIONS.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.012.md)
- [Tex. Insurance Code § 823.013 § 823.013. MANDAMUS.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.013.md)
- [Tex. Insurance Code § 823.014 § 823.014. APPLICABILITY OF CHAPTER TO FOREIGN OR ALIEN INSURER.](https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.014.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/STATE_TX_Cin_C823_S823.008. Check the current official text before relying on it. Not legal advice.