AUSTIN. TEXAS 

January 25, 1950 

Ron. George B. Butler, Chairman 

Board of Insurance Commissioners 

Austin, Texas Opinion Bo. V-989 

Re: 

Dear Sir: 

The authority of a life 

insurance company, which 

owns home office propertiea in another state, 

to own real estate for 

a branch office in Texas. 

Your request for an opinion presents the question of whether a life insurance company organised under 

the laws of another state in which it has its home office and in which it owns home office properties, but 

licensed to transact business in Texas, may own an office building in Texas for use in connection with the 

transaction of its business in this State. 

In your opinion request you advised of the 

following: 

"The Washington Rational Insurance Company is an Illinois life, health and accident 

company with its home offices in Chicago and 

its executive offices in Evanston, Illinois. 

It is presently licensed to do business in 

Texas and has been so licensed for a number 

of years. It owns home office properties in 

Evanston in which its principal records are 

located and from which its principal business 

is transacted. 

"It has recently purchased a vacant lot 

in Houston, Texas, on which it has erected a 

one-story brick building which is used exclusively as a branch office for the transaction of such of its business as is necessary for that area. . . . 

"Please advise me whether Washington National Insurance Company is authorized to own 
Hon. George B. Butler; Page 2 (V-989) 

and hold real estate under discuaaion 

for the purposes abeve outlined." 

In studying this question we have carefully 

considered the view of the Board,of,Inaurance Commiaaioners as presented in your opinion request, briefs 

submitted by interested parties, Andy Attorney General's 

Opinions Nos. O-5823, O-1470, O-4556, O-4587; 0-4587-A, 

o-5250, and 0-5250-A. by,previous administrations. 

Article 4726, V.C.S., provides in part: 

"Every such insurance company may 

secure, hold and convey real property only 

for the following purposes and in the following manner: 

w(1) One building site and office 

building for its accommodations in the 

transaction of its business and for lease, 

and rental; a ., . Provided, that an aci 

quisition of such an office building on 

leased ground shall be approved by the 

Board of Insurance Commissioners of the 

State of Texas before such investment." 

Does this article impliedly prohibit a foreign 

insurance company which owns office properties in another state from owning an office building in Texas? We 

think not. Any implication to that effect found in Article 4726 is overcome by Articles 4765 and 4766, V.C.S, 

Article 4765, V,C.S., reads as follows: 

"Each life insurance company now engaged, or that may hereafter engage in transacting the business of life insurance in 

this State, shall, as a condition of its 

right to transact such business in this State, 

invest and keep invested in Texas securities 

and in Texas real estate as hereinafter providea, a sum of money equal to at least 

seventy-five per cent of the aggregate amount of the legal reserve required by the 

laws of the State of its domicile, e0en 

(Emphasis ours). 

Article 4766, as amended, Acts 5lst Leg., B.S. 

1949, Chapter 438, p. 813, provides, in part, as follows: 
Hon. George B. Butler, Page 3 (V-989) 

The investments required by this 

Chapt~;*~ay be made by the purchase of not 

more than one building site, and in the erection thereon of not more than one office 

building, or in the purchase, at its reaaonable market value, of such office building 

already constructed and the ground upon 

which the same is located in any city of 

the State of more than four thousand (4000) 

inhabitants...." 

read 

We are of the opinion that Article 4766, when 

with Article 4765, expressly authoriaes a foreign 

insurance company to own one office building in this 

State, even though it may own home office properties in 

another state. We do not believe that it was the intention of the Legislature in enacting Article 4766 to give 

permlasion to own one office building to a foreign insurance company only when it did not own a home office 

bui,lding, since many if not moat fore1 

r 

insurance companies would be expected to own home o fice buildings 

in the state where their home offices are located. 

In further support of our opinion, we invite 

your attention to Article 4762, V.C.S., which provides: 

"The assets of any company not organized under the laws of this State shall be 

invested in securities or property of the 

same classes permitted by the laws of this 

State as to home companies or by other laws 

of this State in other securities approved 

by the Commissioner as being substantially 

the same grade." 

The above quoted Article was referred to in 

Attorney Generalvs Opinion O-5823 in which it was said: 

"It is our opinion, therefore, that any 

foreign insurance company authorined to tranaact in this state any or all kinds of inaurante above named under the proviaiona of Chapter 3, Title 78, (Articles 4716-476&b) is authorised to own real estate in this State as 

authorised by Article 4726, Et-t- must 

also be alienated as provided thereby." (Emphasis ours). 
Hen, George B, Butler, Page 4 (V-989) 

The opinion quoted above points out that 

foreign insurance companies authorized to transact 

business in Texaa,have the same privileges in Texas 

as domestic insurance companies. Accordingly, we 

think any foreign insurance company may own in Texas 

one office building as permitted to domestic companies under Article 4726. We are also of the opinion, as indicated above, that Article 4766 expressly 

authorizes out-of-state insurance companies to own 

one office building in Texas, 

SUMMARY 

A foreign insurance company licensed 

to do business in Texas may own one office 

building for use in connection with its business transactions in this area, even though 

such insurance company owns home office 

properties in another state. 

APPROVED: Yours very truly, 

Ned McDaniel PRICE DANIEL 

State Affairs Division Attorney General 

Charles D. Mathews 

Executive Assistant 

By5fe 

Assistant