| (a) A group doing business in Texas as a risk retention group shall not provide physical damage coverage, property coverage, surety bonds, or any insurance except: (1) liability insurance; or (2) reinsurance with respect to the liability of any other risk retention group, or any members of such other group, which is engaged in businesses or activities so that the group or member meets the requirement of the Insurance Code, Article 21.54, §2(6), for membership in the risk retention group which provides the reinsurance. (b) A group doing business in Texas as a purchasing group shall not procure physical damage coverage, property coverage, surety bonds, or any insurance except liability insurance on a group basis. (c) A group violating this section shall not have the status of a risk retention group or purchasing group under the Insurance Code, Article 21.54.
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