South Carolina General Assembly
117th Session, 2007-2008

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Bill 1132


Indicates Matter Stricken
Indicates New Matter


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

A BILL

TO AMEND SECTION 38-1-20, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEFINITIONS USED IN MATTERS RELATING TO INSURANCE, SO AS TO REDEFINE "ADMITTED ASSETS"; TO AMEND SECTION 38-9-10, RELATING TO CAPITAL AND SURPLUS REQUIRED OF STOCK INSURERS, SO AS TO REQUIRE THE INSURER TO LIST THOSE THAT QUALIFY AS ADMITTED ASSETS ON THE INSURER'S MOST RECENT STATUTORY FINANCIAL STATEMENT FILED WITH THE DEPARTMENT OF INSURANCE; TO AMEND SECTION 38-9-20, RELATING TO THE SURPLUS REQUIRED OF MUTUAL INSURERS, SO AS TO REQUIRE THE INSURER TO LIST THOSE THAT QUALIFY AS ADMITTED ASSETS ON THE INSURER'S MOST RECENT STATUTORY FINANCIAL STATEMENT FILED WITH THE DEPARTMENT OF INSURANCE; TO AMEND SECTION 38-9-210, RELATING TO THE REDUCTION FROM LIABILITY FOR REINSURANCE, SO AS TO REQUIRE A SECURITY TO MEET CERTAIN REQUIREMENTS CONSISTENT WITH THE DEFINITION OF "ADMITTED ASSETS" AS DEFINED IN SECTION 38-1-20 AS AMENDED BY THIS ACT; TO AMEND SECTION 38-10-40, RELATING TO PROTECTED CELL ASSETS, SO AS TO DELETE THE AUTHORIZATION FOR ATTRIBUTABLE ASSET OF A PROTECTED CELL TO BE INVESTED AND REINVESTED WITHOUT REGARD TO THE REQUIREMENTS OF SECTIONS 38-11-40 AND 38-11-50; AND TO AMEND SECTION 38-55-80, RELATING TO LOANS BY AN INSURER TO ITS DIRECTORS OR OFFICERS, SO AS TO DELETE THE LIMITATION ON MORTGAGE LOANS OR RESIDENCES ACQUIRED UNDER THIS SECTION PURSUANT TO THE PROVISIONS OF SECTION 38-11-50.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION    1.    Section 38-1-20(4) of the 1976 Code is amended to read:

"(4)    'Admitted assets' means assets of an insurer considered admitted under Section 38-11-100 on the insurer's most recent statutory financial statement filed with the department pursuant to Section 38-13-80."

SECTION    2.    Section 38-9-10(A)(2) of the 1976 Code is amended to read:

"(2)    The director or his designee may require additional initial capital and surplus based on the type or nature of business transacted, and the initial capital and surplus of the insurer must consist of cash or marketable securities which are eligible investments under Section 38-11-40 that qualify as admitted assets on the insurer's most recent statutory financial statement filed with the department pursuant to Section 38-13-80."

SECTION    3.    Section 38-9-20(A)(2) of the 1976 Code is amended to read:

"(2)    The director or his designee may require additional initial surplus based on the type or nature of business transacted, and the initial surplus of the insurer must consist of cash or marketable securities which are eligible investments under Section 38-11-40 that qualify as admitted assets on the insurer's most recent statutory financial statement filed with the department pursuant to Section 38-13-80."

SECTION    4.    Section 38-9-210(2) of the 1976 Code is amended to read:

"(2)    securities listed by the Securities Valuation Office of the National Association of Insurance Commissioners and qualifying as admitted assets under Section 38-11-100 that qualify as admitted assets on the insurer's most recent statutory financial statement filed with the department pursuant to Section 38-13-80;"

SECTION    5.    Section 38-10-40(B) of the 1976 Code is amended to read:

"(B)    The income, gains and losses, realized or unrealized, from protected cell assets and protected cell liabilities must be credited to or charged against the protected cell without regard to other income, gains or losses of the protected cell company, including income, gains or losses of other protected cells. Amounts attributed to any protected cell and accumulations on the attributed amounts may be invested and reinvested without regard to any requirements or limitations of Sections 38-11-40 and 38-11-50 and The investments in a protected cell or cells may not be taken into account in applying the investment limitations otherwise applicable to the investments of the protected cell company."

SECTION    6.    Section 38-55-80(B) of the 1976 Code is amended to read:

"(B)    This section does not prohibit an insurer in connection with the relocation of the place of employment of an officer, including any relocation in connection with the initial employment of the officer, from making, or the officer from accepting, a mortgage loan to the officer on real property owned by the officer which is to serve as his residence or acquiring, or the officer from selling to it, at not more than the fair market value, the residence of the officer. Mortgage loans made or residences acquired under this section are subject to the limitations imposed on investments by Section 38-11-50. In addition, this section does not prohibit an insurer from making a loan to its directors or officers if the loan is first approved in writing by the director or his designee."

SECTION    7.    This act takes effect upon approval by the Governor.

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