TX HB4386

Requires existing insurers to transfer annuity contract values to replacing insurers within 30 business days of receiving an exchange request notice, unless contract terms specify a different deferral period or fraud is suspected

Mandates insurers pay a 10% annual penalty interest rate on unpaid amounts if they fail to complete transfers within the required timeframe for both exchanges and surrenders

Requires existing insurers to send a letter to contract owners within 5 business days of receiving an exchange request notice

Exchange request notices must include all information necessary to qualify as a tax-free exchange under IRS Section 1035 and may use standard industry forms from the Association for Cooperative Operations Research and Development

Applies to annuity contract exchanges or surrenders initiated on or after January 1, 2026, with the act taking effect September 1, 2025