§ 23-63-818 — Stocks of subsidiaries

Arkansas § 23-63-818

• Jurisdiction: Arkansas
• Title: 23

Text

(a) With the Insurance Commissioner's written approval, a domestic insurer may invest in the stock of its wholly owned subsidiary insurance corporation or in the stock of its wholly owned subsidiary business corporation formed or acquired for and necessary and incidental to: (1) The convenient operation of the domestic insurer's insurance business; or (2) The administration of any of the domestic insurer's lawful investments. (b) Unless a greater investment has been approved in writing by the commissioner: (1) All of the domestic insurer's investments under this section together with its investments in insurance stocks under § 23-63-817(b) shall not at any time exceed: (A) The domestic insurer's surplus if a life insurer; or (B) The domestic insurer's policyholders' surplus if other than a life insurer; and (2) (A) A domestic insurer subject to this subchapter shall limit its investments in common stock, preferred stock, debt obligations, and other securities of its noninsurance subsidiaries to the lesser of: (i) Ten percent (10%) of the domestic insurer's assets; or (ii) Fifty percent (50%) of the domestic insurer's surplus. (B) This subdivision (b)(2) does not apply to the amount of an investment held on July 31, 2007, by a domestic insurer licensed in Arkansas. (c) With the prior written approval of the commissioner, a domestic insurer may invest any amount in the securities of one (1) or more of the domestic insurer's subsidiaries if after the investment the domestic insurer's policyholders' surplus is: (1) Reasonable in relation to the domestic insurer's outstanding liabilities; and (2) Adequate for the domestic insurer's financial needs. (d) An investment that exceeds the scope of an approval granted under this section requires the additional prior written approval of the commissioner.

Legislative History

Acts 1959, No. 148, § 114; A.S.A. 1947, § 66-2618; Acts 2007, No. 496, § 11; 2009, No. 726, § 20.