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Senate Study Bill 2090

Bill Text

PAG LIN
  1  1    Section 1.  Section 511.8, subsection 19, unnumbered
  1  2 paragraph 1, Code 1997, is amended to read as follows:
  1  3    Bonds or other evidences of indebtedness, not to include
  1  4 currency, issued, assumed, or guaranteed by a foreign
  1  5 government other than Canada, or by a corporation incorporated
  1  6 under the laws of a foreign government other than Canada.  Any
  1  7 such Such governmental obligations must be valid, legally
  1  8 authorized and issued, and on the date of acquisition have
  1  9 predominantly investment qualities and characteristics as
  1 10 provided by rule.  Any such Such corporate obligations must
  1 11 meet the qualifications established in subsection 5 of this
  1 12 section for bonds and other evidences of indebtedness issued,
  1 13 assumed, or guaranteed by a corporation incorporated under the
  1 14 laws of the United States or Canada.  Foreign investments
  1 15 authorized by this subsection are not eligible in excess of
  1 16 two ten percent of the legal reserve of the life insurance
  1 17 company or association.  Investments in obligations of a
  1 18 foreign government other than Canada are not eligible in
  1 19 excess of two percent of the legal reserve in the securities
  1 20 of foreign governments of any one foreign nation.  Investments
  1 21 in a corporation incorporated under the laws of a foreign
  1 22 government other than Canada are not eligible in excess of two
  1 23 percent of the legal reserve in the securities of any one
  1 24 foreign corporation.
  1 25    Sec. 2.  Section 515.35, subsection 4, paragraph i, Code
  1 26 Supplement 1997, is amended to read as follows:
  1 27    i.  FOREIGN INVESTMENTS.  Obligations of and investments in
  1 28 foreign countries, as follows:
  1 29    (1)  A company may acquire and hold other investments in
  1 30 foreign countries that are required to be held as a condition
  1 31 of doing business in those countries, so long as such
  1 32 investments are of substantially the same types as those
  1 33 eligible for investment under this section.
  1 34    (2)  A company may shall not invest not more than two
  1 35 percent of its admitted assets in the obligations of foreign
  2  1 governments, corporations, or business trusts, or in the
  2  2 stocks or stock equivalents of foreign corporations or
  2  3 business trusts, other than the stocks or stock equivalents of
  2  4 foreign corporations or business trusts incorporated or formed
  2  5 under the laws of Canada, and then only if the obligations,
  2  6 stocks, or stock equivalents of such foreign corporations or
  2  7 business trusts are regularly traded on the New York, London,
  2  8 Paris, Zurich, Hong Kong, Toronto, or Tokyo stock exchange, or
  2  9 a similar exchange approved by the commissioner by rule or
  2 10 order.
  2 11    (3)  A company may invest in the obligations of a foreign
  2 12 government other than Canada or of a corporation incorporated
  2 13 under the laws of a foreign government other than Canada.  Any
  2 14 such governmental obligation must be valid, legally authorized
  2 15 and issued, and on the date of acquisition have predominantly
  2 16 investment qualities and characteristics as provided by rule.
  2 17 Any such corporate obligation must on the date of acquisition
  2 18 have investment qualities and characteristics, and must not
  2 19 have speculative elements which are predominant, as provided
  2 20 by rule.  A company shall not invest more than two percent of
  2 21 its admitted assets in the obligations of a foreign government
  2 22 other than Canada.  A company shall not invest more than two
  2 23 percent of its admitted assets in the obligations of a
  2 24 corporation incorporated under the laws of a foreign
  2 25 government other than a corporation incorporated under the
  2 26 laws of Canada.
  2 27    (4)  A company shall not invest more than ten percent of
  2 28 its admitted assets in foreign investments pursuant to this
  2 29 paragraph.  
  2 30                           EXPLANATION 
  2 31    This bill amends provisions relating to authorized
  2 32 investments of domestic insurance companies in foreign
  2 33 governments and foreign corporations.  The bill amends Code
  2 34 section 511.8, relating to life insurance companies and
  2 35 associations, and Code section 515.35, relating to insurance
  3  1 companies other than life insurance.  The bill provides that
  3  2 investments in foreign government obligations must, at the
  3  3 time of acquisition, have predominantly investment qualities
  3  4 and characteristics as provided by rule of the insurance
  3  5 commissioner.  The bill provides that investments in foreign
  3  6 governments and foreign corporations are limited to an
  3  7 investment of 2 percent of the company's assets in any one
  3  8 foreign government or corporation, and limited to a total
  3  9 investment of 10 percent of the company's assets in foreign
  3 10 investments.  The limitation is determined as a percentage of
  3 11 the reserves of a life insurance company or the admitted
  3 12 assets of a nonlife company.  The limitation established does
  3 13 not include investments in the government of Canada or
  3 14 corporations incorporated under the laws of Canada.  
  3 15 LSB 4177SC 77
  3 16 mj/jl/8

Text: SSB02089                          Text: SSB02091
Text: SSB02000 - SSB02099               Text: SSB Index
Bills and Amendments: General Index     Bill History: General Index

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