§ 27-1-20-8 — Deposits as a condition of doing business; definitions; securities; bank deposits with restricted withdrawal privileges

Indiana § 27-1-20-8

• Jurisdiction: Indiana
• Title 27: INSURANCE
• Art. 1: DEPARTMENT OF INSURANCE
• Ch. 20: Additional Provisions Pertaining to All Insurance

Text

(a) The definitions set forth in this subsection
apply throughout this section:
(1) "Broker dealer" means an entity that:
(A) is registered with and subject to the jurisdiction of the
Securities and Exchange Commission;
(B) maintains membership in the Securities Investor Protection
Corporation; and
(C) has a tangible net worth of at least two hundred fifty million
dollars ($250,000,000).
(2) "Clearing corporation" means a corporation as defined in IC 26-1-8.1-102 except that with respect to securities issued by
institutions organized or existing under the laws of any foreign
country or securities used to meet the deposit requirements
pursuant to the laws of a foreign country as a condition of doing
business in the foreign country. "Clearing corporation" may
include a corporation organized or existing under the laws of any
foreign country and which is legally qualified under such laws to
effect transactions in securities by computerized book entry.
(3) "Direct participant" means a bank, trust company, or safety
deposit company approved by the commissioner which maintains
an account in its name in a clearing corporation and through
which an insurance company participates in a clearing
corporation.
(4) "Federal Reserve book-entry system" means the computerized
systems sponsored by the United States Department of the
Treasury and certain agencies and instrumentalities of the United
States for holding and transferring securities of the United States
government and such agencies and instrumentalities, respectively,
in Federal Reserve Banks through banks which are members of
the Federal Reserve System, or which otherwise have access to
such computerized systems.
(5) "Member bank" means a national bank, state bank, or trust
company which is a member of the Federal Reserve System and
through which an insurance company participates in the Federal
Reserve book-entry system.
(6) "Securities" means instruments meeting the definition set forth
in IC 26-1-8.1-102.
(b) Notwithstanding any other provision of law, a domestic
insurance company may deposit or arrange for the safekeeping of
securities held in or purchased for its general account and its separate
accounts in a clearing corporation or the Federal Reserve book-entry
system. When securities are deposited with a clearing corporation,
certificates representing securities of the same class of the same issuer
may be merged and held in bulk in the name of the nominee of such
clearing corporation with any other securities deposited with such
clearing corporation by any person, regardless of the ownership of such
securities, and certificates representing securities of small
denominations may be merged into one (1) or more certificates of
larger denominations. The records of any member bank or broker
dealer through which an insurance company holds securities in the
Federal Reserve book-entry system, and the records of any custodian
through which an insurance company holds securities in a clearing
corporation, shall at all times show that such securities are held for
such insurance company and for which accounts thereof. Ownership of,
and other interests in, such securities may be transferred by
bookkeeping entry on the books of such clearing corporation or in the
Federal Reserve book-entry system without, in either case, physical
delivery of certificates representing such securities.
(c) Any Indiana law requiring an insurance company operating
under the laws of Indiana to deposit assets with the department shall be
deemed complied with if such deposit is made pursuant to a written
agreement between the insurance company and any bank, trust
company or a safety deposit company and approved by the
commissioner which limits withdrawals to those sanctioned and
approved by the department. Deposits so made shall be credited by the
department as deposits in its possession on the basis of the insurance
company's affidavit describing such deposits as to amount and nature.
(d) Notwithstanding any other provisions of law, securities eligible
for deposit under the insurance law of this state relating to deposit of
securities by an insurance company as a condition of commencing or
continuing to do an insurance business in this state may be deposited
with a clearing corporation or held in the Federal Reserve book-entry
system. Securities deposited with a clearing corporation or held in the
Federal Reserve book-entry system and used to meet the deposit
requirements under the insurance laws of this state shall be under the
control of the commissioner and shall not be withdrawn by the
insurance company without the approval of the commissioner. Any
insurance company holding such securities in such manner shall
provide to the commissioner evidence issued by its custodian or a
member bank through which such insurance company has deposited
securities with a clearing corporation or held in the Federal Reserve
book-entry system, respectively, in order to establish that the securities
are actually recorded in an account in the name of the custodian or
other direct participant or member bank and evidence that the records
of the custodian, other participant, or member bank reflect that such
securities are held subject to the order of the commissioner.
(e) The commissioner of insurance is authorized to promulgate rules
and regulations governing the deposit by insurance companies of
securities with clearing corporations and in the Federal Reserve
book-entry system.
Formerly: Acts 1935, c.162, s.255; Acts 1945, c.175, s.5; Acts
1957, c.22, s.1. As amended by Acts 1981, P.L.238, SEC.2; Acts 1982,
P.L.164, SEC.1; P.L.255-1995, SEC.4; P.L.247-1995, SEC.24;
P.L.11-2011, SEC.16; P.L.136-2018, SEC.164.