§ 23-63-814 — Corporate bonds and debentures

(a) An insurer may invest in bonds, debentures, notes, and other evidences of indebtedness issued, assumed, or guaranteed by any solvent institution existing under the laws of the United States or of Canada, or any state or province thereof, which are not in default as to principal or interest and which are secured by collateral worth at least fifty percent (50%) more than the par value of the entire issue of such obligations, but only if not more than one-third (1/3) of the total value of the required collateral consists of common stock. (b) An insurer may invest in secured and unsecured obligations of the institutions, other than obligations described in subsection (a) of this section, that are not in default as to principal or interest, if the obligations: (1) Are rated or expected to be rated by the Securities Valuation Office of the National Association of Insurance Commissioners, if not otherwise exempt under the Purposes and Procedures Manual of the Securities Valuation Office of the National Association of Insurance Commissioners; or (2) Bear interest at a fixed rate, with mandatory principal and interest due at specified times, and if the net earnings of the issuing, assuming, or guaranteeing institution available for its fixed charges for five (5) fiscal years next preceding the date of acquisition by the insurer have averaged per year not less than one and one-half (11/2) times its average annual fixed charges applicable to the period and if, during either of the last two (2) years of the period, the net earnings have been not less than one and one-half (11/2) times its fixed charges for the year.

Legislative History

Amended by Act 2015, No. 1223,§ 15, eff. 7/22/2015. Acts 1959, No. 148, § 110; A.S.A. 1947, § 66-2614.