TX Attorney General Opinion. TRS Investments. Indexed Life Policies. 2 Question Test.

Question answered by the TX Attorney General opinion:  Whether the Teacher Retirement System may invest in indexed universal life insurance policies funded by leveraged premiums.

Answer: Maybe, but it depends on the individual indexed universal life policies

What 2 questions can be asked in the future to find out if TRS can invest in a certain product?

• Is the investment  a security?
  • article XVI, section 67 of the constitution,
    • a security “includes any investment instrument within the meaning ofthe term as defined by” a specified section in one of three statutory sources:
    • (1) the Texas Securities Act;
    • (2) the federal Securities Act of 1933; or
    • (3) the federal Securities Exchange Act of 1934.
  • TEX.Gov’t Code § 825.301(a).5
• Does the investment meet the standards for prudence and overall strategy in the Texas Constitution & statutes.
  • 117.004(b) of the Property Code
  • TEX. Gov’t Code § 825.30l(a)

What would change the answer?  defining an indexed universal life insurance policies funded by leveraged premiums as a security

Texas Attorney General Opinion KP-0220 (2018)