Chapter 3907. DOMESTIC LEGAL RESERVE LIFE INSURANCE COMPANIES
Any number of persons, not less than thirteen, may associate
and form a company to make insurance upon the lives of individuals, and every
type of insurance appertaining thereto or connected therewith, on the mutual or
stock plan, and to grant, purchase, or dispose of annuities.
Effective Date:
10-01-1953 .
The persons forming a company under section
3907.01 of the Revised Code shall
file in the office of the secretary of state articles of incorporation, signed
by them, setting forth their intention to form a company, which articles shall
comprise a copy of the charter they propose to adopt. The charter shall set
forth the name of the company, which shall not be the corporate name or title
used to designate any fire, life, marine, or other insurance company existing
under the laws of this state, the place where it is to be located, the kind of
business to be undertaken, the manner in which its corporate powers are to be
exercised, the number of directors or trustees, the manner of electing them and
other officers, the time of such election, the manner of filling vacancies, the
amount of capital to be employed, and such other particulars as are necessary
to explain and make manifest the objects and purposes of the company, and the
manner in which it is to be conducted. The number of directors or trustees
shall be not less than five nor more than twenty-one. The number of directors
or trustees may be fixed or changed at a meeting of the stockholders or members
called for the purpose of electing directors or trustees at which a quorum is
present, by affirmative vote of the holders of a majority of the shares, or a
majority of the members, which are represented at the meeting and entitled to
vote on the proposal. In addition to the authority of the stockholders or
members to change the number of directors or trustees and the manner in which
the number may be fixed or changed, the articles, code of regulations, or
bylaws may authorize the directors or trustees to change the number of
directors or trustees, may specify the manner in which the directors or
trustees are to change the number of directors or trustees and the limitations
upon the directors' or trustees' use of this authority, and may authorize the
directors or trustees who are in office to fill any director's or trustee's
office that is created by an increase in the number of directors or trustees.
No reduction in the number of directors or trustees shall of itself have the
effect of shortening the term of any incumbent director or trustee.
Effective Date:
06-18-2002 .
When the articles of incorporation are filed in the office of
the secretary of state under section
3907.02 of the Revised Code, and
the name assumed by the company is not so nearly similar to that of any other
company organized in this state as to lead to confusion or uncertainty on the
part of the public, the secretary of state shall submit them to the attorney
general for examination. If such articles are found by him to be in accordance
with sections
3907.01 to
3907.21, inclusive, of the Revised
Code, and not inconsistent with the constitution and laws of the United States
and of this state, he shall certify to and deliver them to the secretary of
state, who shall cause them, together with the certificate of the attorney
general, to be recorded in a book kept for that purpose. Upon application of
the signers of such articles of incorporation, the secretary of state shall
furnish to them a certified copy of such articles and certificates.
Effective Date:
10-01-1953 .
When the signers of the articles of incorporation required by
section 3907.02 of the Revised Code
receive from the secretary of state a certified copy of such articles and
desire to organize the company, they shall publish their intention in a paper
published and having general circulation in the county in which the company is
to be organized. After the publication has been made for six weeks, they may
open books to receive subscriptions to the capital stock, keep them open until
the required amount is subscribed, distribute the stock among the subscribers,
if more than the necessary amount is subscribed, collect the capital, and
complete the organization of the company.
Effective Date:
10-01-1953 .
| (A) |
| (1) |
No company shall be incorporated under sections
3907.01 to
3907.21 of the Revised Code, on or
after January 1, 1982, until the superintendent of insurance has certified to
the secretary of state that a sum has been escrowed with a bank or trust
company by the incorporators under their plan of incorporation sufficient to
meet a minimum of one hundred thousand dollars paid-in capital and one hundred
fifty thousand dollars contributed surplus. The cost of registration, printing,
promotion, and all other expenses incident to an offer of securities shall be
paid from this initial escrow account. The superintendent may waive the
requirement of this initial escrow account if registration by qualification or
coordination of the securities to be offered is not required under Chapter
1707. of the Revised Code. Upon organization, filing of policies, and evidence that the
officers of the company are experienced in insurance company management, the
superintendent shall issue a certificate of authority conditioned upon the
company obtaining, before commencing the business of insurance, capital and
surplus in the aggregate amount of not less than two million five hundred
thousand dollars which aggregate shall include paid-in capital of not less than
one million dollars and contributed surplus of not less than one million
dollars.
|
| (2) |
The company
shall establish for the benefit of stockholders a second escrow account with a
bank or trust company into which shall be deposited all proceeds of any offer
of its securities necessary to equal or exceed, when combined with the initial
escrow account, if any, the capital and surplus with which such company was
authorized to begin business. Upon receipt of evidence that the combined net deposits of both
escrow accounts equal or exceed the capital and surplus with which such company
was authorized to begin business, the superintendent of insurance shall order
the escrowed funds released to the company which may then commence the business
of insurance.
|
|
| (B) |
Before the company proceeds to do business, the
whole capital shall be paid in and invested in treasury notes, in stocks or
bonds of the United States or of this state or of any municipal corporation or
county in this state, in bonds or notes secured by mortgages on unencumbered
fee simple real estate within this state provided the amount loaned does not
exceed eighty per cent of the actual market value of such realty, in any bonds
issued by or for federal land banks and any debentures issued by or for federal
intermediate credit banks under the act of congress known as the "Federal Farm
Loan Act of 1916," 39 Stat. 360, 12 U.S.C. 641, as amended, or in any
debentures issued by or for banks for cooperatives under the act of congress
known as the "Farm Credit Act of 1933," 48 Stat. 257, 12 U.S.C. 131, as
amended. At no time shall more than one-half of its paid-in capital be invested
in bonds or notes secured by mortgages on unencumbered real estate or more than
ten per cent of its paid-in capital be invested in any one mortgage. If the amount loaned through mortgages on unencumbered realty
exceeds eighty per cent of the actual market value of the land mortgaged,
exclusive of structures thereon, such structures shall be insured in an
authorized fire insurance company in any amount not less than the difference
between eighty per cent of the actual market value of such land exclusive of
the structures, and the amount that is loaned, and the policy shall be assigned
to the mortgagee.
|
Effective Date:
09-25-1981 .
When, in the opinion of its board of directors, a legal reserve
life insurance company organized under any law of this state, requires a larger
amount of capital than that fixed by its articles of incorporation, its board
shall, after authorization by the holders of two thirds of the stock, file with
the secretary of state a certificate setting forth the amount of the desired
increase, and thereafter the company shall be entitled to have the increased
amount of capital fixed by the certificate, which shall be invested as required
by section
3907.05 of the Revised Code.
Effective Date:
10-01-1953 .
Any legal reserve life insurance company organized under the
laws of this state may invest its capital in the stocks, bonds, or mortgages
authorized by section
3907.05 of the Revised Code, and
may change and invest it or any part thereof in like manner. No company shall
commence business until it has deposited with the superintendent of insurance
at least one hundred thousand dollars, in such stocks, bonds, or mortgages,
made or assigned to the superintendent in trust for the purposes mentioned in
sections 3907.01 to
3907.21, inclusive, of the Revised
Code. When a mortgage of real estate is assigned to the superintendent, the
assignment shall be immediately entered in the records of the county in which
the real estate is situated, and the fee for its recording shall be paid by the
company.
The superintendent shall hold such securities as security for
policyholders in the company. As long as any company depositing such securities
remains solvent, he shall permit it to collect the interest or dividends on the
securities, and from time to time to withdraw them, or a part thereof, on
depositing with him other securities of the kinds named in section
3907.05 of the Revised Code, and
of equal value with those withdrawn.
In case a company making or maintaining such deposit with the
superintendent, through inadvertence or by reason of not having securities in
such denominations as to make the exact sum of one hundred thousand dollars,
deposits securities in excess of the requirement, such excess shall be held in
trust for the company and not for the benefit of policyholders, and shall be
returned to the company making the deposit on its demand.
Effective Date:
10-01-1953 .
When a company is fully organized and has deposited the amount
of securities required by section
3907.07 of the Revised Code, it
shall file with the superintendent of insurance a duly certified copy of its
articles of incorporation, a copy of the approval of the attorney general, and
a copy of its bylaws or constitution. If the superintendent finds that the
company is duly organized and that its capital stock has been subscribed, paid
in, and invested as required by law, unless he finds the name assumed by the
company so nearly similar to the name of another company doing business in this
state as to lead to confusion or uncertainty on the part of the public, he
shall furnish the company with his certificate of such deposit, and with a
license reciting that the company has complied with the law and is entitled to
transact the business defined in section
3911.01 of the Revised Code, which
license shall be its authority to commence business and issue policies.
So long as the company complies with the law, the
superintendent, annually, upon its application, shall renew such license.
Certified copies thereof may be used in evidence for and against the company in
all actions.
Effective Date:
10-01-1953 .
Repealed by
130th General Assembly File No. TBD, SB 140, §2,
eff. 9/4/2014.
Effective Date: 10-01-1953
.
Repealed by
130th General Assembly File No. TBD, SB 140, §2,
eff. 9/4/2014.
Effective Date: 10-30-1969
.
Repealed by
130th General Assembly File No. TBD, SB 140, §2,
eff. 9/4/2014.
Effective Date: 10-01-1953
.
| (A) |
As used in this
section:
| (1) |
"Assumption reinsurance"
means the transfer of an insurance contract from a domestic life insurance
company to a life insurance company authorized to do business in this
state. |
| (2) |
"Individual risk"
includes any policy, annuity, or contract issued pursuant to section
3907.15 of the Revised
Code. |
|
| (B) |
Except as provided in division (C) of this section, a
domestic life insurance company shall not reinsure, by agreement or
modification to an existing agreement, either of the following without the
prior approval of the superintendent of insurance:
| (1) |
More than eighty per cent of an individual risk to a
company authorized to transact the business of insurance in this state; |
| (2) |
Any part of an individual
risk to a company that is not authorized to transact the business of insurance
in this state. |
|
| (C) |
Division (B) of this section shall not apply to either
of the following:
| (1) |
Reinsurance agreements or
modifications thereto in which either of the following applies:
| (a) |
The reinsurance premium or the change in the domestic
life insurance company's liabilities is less than five per cent of the domestic
life insurance company's surplus as regards policy holders as of the
thirty-first day of December next preceding. |
| (b) |
The projected reinsurance premium or projected change
in the domestic life insurance company's liabilities in any of the next three
years is less than five per cent of the domestic life insurance company's
surplus as regards policyholders as of the thirty-first day of December next
preceding. |
|
| (2) |
Reinsurance agreements, or modifications to an
agreement, as the result of a facultative provision with an authorized
reinsurer. |
|
| (D) |
Any domestic life insurance company may, with the
written consent of the superintendent, enter into a contract of reinsurance by
which all of the domestic life insurance company's obligations or risks, or the
obligations or risks of a product line or subset thereof, for in-force policies
are assumed by another life insurance company with the intent of effecting a
novation, commonly referred to as assumption reinsurance. |
Added by
131st General Assembly File No. TBD, SB 223, §1,
eff. 3/23/2016.
Repealed by
130th General Assembly File No. TBD, SB 140, §2,
eff. 9/4/2014.
Effective Date: 10-01-1953
.
The capital, surplus,
and all accumulations of every domestic life insurance company shall be
invested as follows:
| (A) |
A domestic company may acquire, hold, and convey
real estate:
| (1) |
Which has
been acquired or is acquired for its principal offices, or which is used in
connection therewith, provided that it shall not invest more than five per cent
of its admitted assets on the preceding thirty-first day of December in such
real estate; |
| (2) |
Which has
been mortgaged to it in good faith by way of security for loans previously
contracted or for money due; |
| (3) |
Which has been conveyed to it in satisfaction of debts previously contracted in
the course of its dealings, or which it may receive in or on account of an
exchange for real estate acquired in its operations; |
| (4) |
Which it has purchased at sales under mortgages and on any legal process in
connection with its investments or under decrees obtained or made for such
debts; |
| (5) |
Which is
acquired, owned, or held for the purpose of developing, improving, or otherwise
utilizing such real estate for the production of income, without restriction or
limitation as to time, and may acquire, lease, hold, and manage personal
property used in connection therewith. No investments in real estate to be used
primarily for recreational, agricultural, or mining purposes shall be made
under authority of division (A)(5) of this section and except for investments
authorized under divisions (A)(1), (2), (3), and (4) of this section, no
domestic life insurance company shall invest in real estate under divisions
(A)(5) and (R) of this section a sum exceeding in the aggregate ten per cent of
its admitted assets on the preceding thirty-first day of December. All real estate specified
in divisions (A)(3) and (4) of this section, which is not necessary for its
accommodation in the convenient transaction of its business, shall be sold by
the company and disposed of within five years after it has acquired the title
to such real estate or within five years after such real estate has ceased to
be necessary for the accommodation of its business, unless the company procures
the certificate of the superintendent of insurance that its interests will
suffer materially by a forced sale of the real estate, in which event the time
for the sale may be extended to such time as the superintendent directs in such
certificate.
|
|
| (B) |
A
domestic company may acquire, hold, and convey tangible personal property or
interests therein for the production of income, provided no domestic company
shall invest in excess of two per cent of its admitted assets as of the
preceding thirty-first day of December under this division. |
| (C) |
In
loans and liens upon the security of its own policies, not exceeding the
reserve or present value of the policies, computed according to any standard
authorized by law or according to such higher standard as the company has
adopted and maintains on the policy, the reserve being the amount of debts of
the life insurance company by reason of its outstanding policies in gross,
which may be so treated in the returns for taxation made by it; |
| (D) |
In
bankers' acceptances and bills of exchange of the kinds and maturities made
eligible by law for rediscount with federal reserve banks, provided that such
acceptances and bills of exchange are accepted by a bank or trust company
incorporated under the laws of the United States or of this state or any other
bank or trust company which is a member of the federal reserve
system; |
| (E) |
In equipment trust obligations or certificates,
security agreements, or other evidences of indebtedness entered into directly
or guaranteed by any company operating wholly or partly within the United
States or Canada, provided that the debt obligation is secured by a first lien
on tangible personal property which is purchased or secured for payment thereof
and the debt obligation is repayable within twenty years from the date of issue
in annual, semiannual, or more frequent installments beginning not later than
the first year after such date; |
| (F) |
In
bonds issued by or for federal land banks and any debentures issued by or for
federal intermediate credit banks under the "Federal Farm Loan Act of 1916," 39
Stat. 360, 12 U.S.C.A. 641 as amended; any debentures issued by or for banks
for cooperatives under the "Farm Credit Act of 1933," 48 Stat. 257, 12 U.S.C.A.
131 as amended; |
| (G) |
In bonds issued under the "Home Owners' Loan Act
of 1933," 48 Stat. 128, 12 U.S.C.A. 1461; |
| (H) |
In
notes, bonds, debentures, or other such obligations issued by the federal
housing administrator; |
| (I) |
| (1) |
| (a) |
In
bonds or other evidences of indebtedness, not in default as to principal or
interest, which are valid obligations issued, assumed or guaranteed by the
United States, by any state thereof, by the Commonwealth of Puerto Rico, by any
territory or insular possession of the United States, or by the District of
Columbia, or which are valid obligations issued, assumed, or guaranteed by any
county, municipal corporation, district, or political subdivision, or by any
civil division or public instrumentality of such governmental units, if by
statutory or other legal requirements such obligations are payable, as to both
principal and interest, from taxes levied upon all taxable property within the
jurisdiction of such governmental unit; |
| (b) |
In
bonds or other obligations issued by or for account of any such governmental
unit having a population of five thousand or more by the latest official
federal or state census, which are payable as to both principal and interest
from revenues or earnings from the whole or any part of a publicly owned
utility supplying water, gas, sewage disposal facility, or electricity, or any
or all of them, provided that by statute or other applicable legal
requirements, rates from the service or operation of such utility must be
fixed, maintained, and collected at all times so as to produce sufficient
revenues or earnings to pay both principal and interest of such bonds or
obligations as they become due; |
| (c) |
In
any bonds or obligations payable from and secured by revenues of the United
States, the Commonwealth of Puerto Rico, or any state or instrumentality of any
of them, or of the District of Columbia or of any commission, board, or other
instrumentality of one or more of them, provided there is a specific pledge of
revenues, and provided that there is adequate provision for payment of interest
prior to completion of construction and that rates, fees, tolls, or charges
fixed are, after completion of construction, sufficient to pay all expenses of
operation and maintenance and the principal and interest when due. |
|
| (2) |
In legally authorized and executed bonds, notes,
warrants, and securities which are the direct obligation of or are guaranteed
by Canada, or which are the direct obligation of or are guaranteed as to both
principal and interest by any province of Canada, or which are the direct
obligation of or are guaranteed as to both principal and interest by any
municipality of Canada having a population of fifty thousand or more by the
latest official census, and which are not in default as to principal or
interest; |
| (3) |
In bonds or other evidence of indebtedness, not in
default as to principal or interest, which are valid obligations issued,
assumed, or guaranteed by the United States, by any state thereof, the
Commonwealth of Puerto Rico, or by the District of Columbia, if by statutory or
other legal requirements such obligations are payable, as to both principal and
interest, from selective taxes levied by such governmental unit. |
|
| (J) |
| (1) |
In mortgage bonds which are the direct obligation
of a railroad, and which are the first lien on a substantial portion of its
property, situated wholly in the United States or partly in the United States
and partly in Canada, the average net yearly earnings of which, after deducting
proper charges for maintenance of way and equipment, for the five fiscal years
preceding such investments, have been at least one and one-half times the
average yearly interest for the same period on its mortgages, bonds, and funded
debts, and in the junior mortgage bond issues of such railroad corporations of
the same character and under the same conditions where the average net yearly
earnings for the five fiscal years preceding such investment, after deducting
proper charges for maintenance of way and equipment, have been at least three
times the average yearly interest charges on such issues and all prior liens;
or in the mortgage bonds of any incorporated railroad company which have been
assumed or guaranteed, both as to principal and interest, by any incorporated
railroad company whose bonds constitute a legal investment under division
(J)(1) of this section. In applying the earnings test to any issuing, assuming,
or guaranteeing company, whether or not in legal existence during the whole of
such five years next preceding the date of investment by such insurer, which
has at any time during such five-year period acquired the assets of any other
company by purchase, merger, consolidation, or otherwise, substantially as an
entirety, or has been reorganized pursuant to the bankruptcy law, the earnings
of such other predecessor or constituent companies, or of the company so
reorganized, available for interest for such portion of such period that has
preceded such acquisition, or such reorganization, may be included in the
earnings of such issuing, assuming, or guaranteeing company for such portion of
such period as is determined in accordance with adjusted or pro forma
consolidated earnings statements covering such portion of such period. In such
cases the requirements as to earnings shall be based upon the mortgages, bonds,
and funded debts as they exist immediately after such acquisitions or such
reorganizations. |
| (2) |
In mortgage bonds or other interest-bearing
obligations of terminal companies organized under the laws of the United States
or any state thereof, provided such bonds or obligations have been assumed or
guaranteed jointly or severally by two or more railroad corporations whose
bonds constitute legal investments under division (J)(1) of this
section; |
| (3) |
In loans to veterans guaranteed in whole or in
part by the United States pursuant to Title III of the "Servicemen's
Readjustment Act of 1944," 58 Stat. 284, 38 U.S.C.A. 693, as amended, provided
such guaranteed loans are liens upon real estate; |
| (4) |
In
mortgage bonds which are the direct obligation of and first lien upon the
property of a corporation engaged directly and primarily in the production and
sale of, or in the purchase and sale of electricity or gas, or in the operation
of telephone or telegraph systems or waterworks, or in some combination of
them, and situated wholly in the United States, or the Commonwealth of Puerto
Rico, or partly in the United States and partly in Canada, the average net
yearly earnings of which, after deducting proper charges for replacements,
depreciation, and obsolescence, for the five fiscal years preceding such
investment, have been at least one and one-half times the average yearly
interest for the same period on its mortgages, bonds, and funded
debts; |
| (5) |
Any such corporation, or any of its predecessors,
constituent, or successor corporations, must have been in business not less
than ten years prior to the date of the purchase of such bonds, and must not
have defaulted on the interest or principal of any of its bonds or funded debts
outstanding during the five years immediately preceding the date of purchase,
provided that division (J)(5) of this section does not preclude investments in
mortgage bonds of railroads reorganized through purchase of assets, merger,
consolidation, bankruptcy proceedings, or otherwise if such bonds are eligible
for investment under division (J)(1) of this section; |
| (6) |
No
investment shall be made under division (J)(1), (2), (4), or (5) of this
section if such railroad or other utility corporation and its business, and its
issue of bonds, funded debts, and stocks are not under the supervision and
control of an authorized state or federal official or commission, provided that
division (J)(6) of this section does not apply to the mortgage bonds or other
interest-bearing obligations of companies engaged in the operation of telephone
or telegraph systems. |
|
| (K) |
| (1) |
In
bonds or notes secured by mortgages or deeds of trust which are a first lien
upon unencumbered fee simple real estate in any state, the Commonwealth of
Puerto Rico, the District of Columbia, or Canada, provided the amount loaned
does not exceed eighty per cent of the actual market value of such property. The actual market value
of any such property shall be shown by a valuation and appraisement in writing
by a qualified land appraiser. In the event the amount
loaned under division (K)(1) of this section exceeds eighty per cent of the
actual market value of the land, the structures on the land must be insured by
an authorized fire insurance company or covered by other comparable
indemnification, and the policies or indemnifications shall be payable or
assigned to the mortgagee or to a trustee in its behalf and shall be held by
the mortgagee or an agent of the mortgagee or by such trustee; or in lieu of
holding such policies or indemnifications, the mortgagee may purchase a policy
or policies of mortgage protection insurance, payable to the mortgagee or a
trustee in its behalf, insuring the mortgagee against loss resulting from the
failure of the mortgagor to acquire and maintain, from such an authorized fire
insurance company or other comparable source, insurance or
indemnification.
|
| (2) |
In
bonds or notes secured by mortgages insured by the federal housing
administrator; |
| (3) |
In bonds or notes secured by mortgages or deeds of
trust which are a first lien on leasehold estates in wholly or partly improved
real property, unencumbered, except rentals accruing from the property to the
owner of the fee, provided that any loan secured by a leasehold estate must
provide for amortization by repayment of principal at least once in each year
in amounts sufficient to repay the loan within a period of four-fifths of the
unexpired term of the leasehold but within a period of not more than thirty
years, and further provided that the amount loaned on the leasehold estate does
not exceed seventy-five per cent of total market value of the leasehold estate
determined by appraisements in writing made under oath by two real estate
owners, residents of the county or local district in which the real estate is
located, or by a qualified land appraiser; if the amount loaned exceeds
seventy-five per cent of the value of that portion of the leasehold estate
represented by the value of the land, exclusive of improvements on the land,
such improvements shall be insured against fire for the benefit of the
mortgagee in an amount not less than the difference between seventy-five per
cent of the value of such land, exclusive of buildings, and the amount loaned;
the policies for such amount shall be payable to and held by the mortgagee or a
trustee named in the lease who shall be required by the terms of said lease to
use and apply the proceeds of such insurance for repairing, restoring, or
rebuilding such buildings; |
| (4) |
The following shall not be considered as prior liens or encumbrances in the
construction and application of this section: leasehold estates of any
duration, rights-of-way, servitudes, joint driveways, easements, party wall
agreements, current taxes and assessments not delinquent, and restrictions as
to building, use, and occupancy. |
| (5) |
This section does not prohibit a domestic life insurance company from renewing
or extending a loan for the original or a lesser amount nor does it prohibit a
company from accepting as part payment for real estate sold by it a mortgage on
the real estate for a greater percentage of the purchase price of the real
estate than is otherwise permitted by this section. |
|
| (L) |
In
bonds, notes, or other evidences of indebtedness of corporations, trusts,
partnerships, or similar business entities organized under the laws of the
United States, or any state thereof, the Commonwealth of Puerto Rico, the
District of Columbia, or Canada or any province of Canada, secured by
assignment of lease or leases or the rentals payable under such leases, of real
or personal property or both to (1) the United States or any instrumentality
thereof, or any state of the United States, the Commonwealth of Puerto Rico, or
the District of Columbia, or any county, city, town, school, or water district,
authority, or other political subdivision in any such government, or Canada,
any province of Canada, or any municipal corporation of Canada that has a
population of fifty thousand or more by the latest official census; or (2) one
or more corporations, trusts, partnerships, or similar business entities
organized under the laws of the United States, any state thereof, the
Commonwealth of Puerto Rico, the District of Columbia, or Canada or any
province of Canada, provided that (a) the fixed rentals assigned shall be
sufficient to repay the indebtedness within the unexpired term of the lease,
exclusive of the term which may be provided by an enforceable option of
renewal; (b) such lessee has not defaulted in payment of interest or principal
on any of its bonds, notes, debentures, or other evidences of indebtedness
during the five years immediately preceding the date of the investment, and
provided the average net earnings available for fixed charges of such lessee
under division (L)(2) of this section for not less than five fiscal years
preceding such investment have been at least one and one-half times average
fixed charges for that period and during either of the last two years of such
period, the net earnings available for fixed charges shall have been not less
than one and one-half times fixed charges for such year, except that railroad
companies and utility companies may qualify as lessees herein by application of
the earnings test provided for railroads under division (J)(1) of this section
and for utilities under division (J)(4) of this section; and (c) a first lien
on the interest of the lessor in the unencumbered property so leased shall be
obtained as additional security for the indebtedness; |
| (M) |
In
ground rents, land trust certificates, or fee ownership certificates
representing or evidencing beneficial ownership of or interest in improved real
estate under lease for not less than twenty-five years from the date of such
lease, in which it must be provided that the lessee shall pay all taxes and
assessments levied on or assessed against said real estate, shall maintain the
improvements on the real estate in good repair, and shall provide and maintain
fire insurance in an amount equal to the insurable value of the building on the
real estate; provided:
| (1) |
The value of
the land and improvements shall be evidenced by an appraisement made under oath
by a disinterested appraiser resident in and the owner of real estate in the
city in which the property is situated, and such appraisement shall not be less
than one and sixty-seven hundredths times the amount of such land trust
certificates, which amount shall be not less than twenty times the net annual
rental distributable to holders of outstanding certificates; |
| (2) |
Such beneficial interests shall only be in properties on which actual earning
records for five years immediately preceding are available; |
| (3) |
Such declaration of trust or other trust instrument shall provide for a
depreciation or other similar fund, in an amount which is not less than nine
per cent of the net annual distributable rental, for the benefit of the holders
of outstanding certificates. |
|
| (N) |
| (1) |
In
certificates of deposit or other evidence of indebtedness of a savings and loan
association provided the certificates or other evidence of deposit are insured
pursuant to the "Financial Institutions Reform, Recovery, and Enforcement Act
of 1989," 103 Stat. 183, 12 U.S.C.A. 1811, as amended; |
| (2) |
In
interest-bearing obligations, including savings accounts and time certificates
of deposit of a national bank or state bank provided such bank is a member of
the federal deposit insurance corporation created pursuant to the "Banking Act
of 1933," 92 Stat. 624, 12 U.S.C.A. 624, as amended. |
|
| (O) |
In
obligations issued, assumed, or guaranteed by the international finance
corporation or by the international bank for reconstruction and development,
the Asian development bank, the inter-American development bank, the African
development bank, or other similar development bank in which the president, as
authorized by congress and on behalf of the United States, has accepted
membership; |
| (P) |
| (1) |
In the preferred stocks of any company organized
under the laws of the United States or of any state thereof engaged directly
and primarily in the production and sale of, or in the purchase and sale of
electricity or gas, or in the operation of telephone or telegraph systems or
water works, or in some combination of them, if the average annual net earnings
of such company, for not less than five fiscal years preceding purchase
thereof, after deduction of interest on all mortgages, bonds, debentures, and
funded debts and after deduction of the proper charges for replacements,
depreciation, and obsolescence, have been at least two times the average yearly
amount which is required to pay the dividends or distributions on all preferred
stocks; and in which the mortgages, bonds, debentures, funded debts, and
preferred stocks shall not in the aggregate exceed seventy per cent of the
total capitalization of such company, including mortgages, bonds, debentures,
funded debts, and preferred and common stocks; |
| (2) |
In
the preferred stocks of any other company organized under the laws of the
United States, or of any state thereof if the average annual net earnings of
such company for a period of not less than five fiscal years preceding purchase
thereof, after deduction of interest on all mortgages, bonds, debentures, and
funded debts and after deduction of the proper charges for replacements,
depreciation, and obsolescence, have been at least four times the amount which
is required to pay the dividends or distributions on all preferred stocks, and
in which the mortgages, bonds, debentures, funded debts, and preferred stocks
shall not in the aggregate exceed sixty per cent of the total capitalization of
such company, including mortgages, bonds, debentures, funded debts, and
preferred and common stocks; |
| (3) |
A
domestic life insurance company shall not purchase any preferred stocks when
the total market values of such stocks then owned with those purchased exceed
in the aggregate of book values and purchase price the capital, surplus, and
contingency funds, excluding all reserves required by law, of such company on
the thirty-first day of December preceding the date of such purchase, or
contemplated purchase, provided that in case of appreciations in values of
stocks owned the cost rather than the market values shall be used in arriving
at such aggregate; the purpose being to restrict the investments of such
company in all preferred stocks to capital, surplus, and contingency
funds. |
| (4) |
In the bonds, notes, debentures, or other
evidences of indebtedness of a solvent corporation, trust, partnership, or
similar business entity existing under the laws of the United States, of any
state thereof, the Commonwealth of Puerto Rico, or Canada or any province of
Canada, provided that either:
| (a) |
The bonds,
notes, debentures, or other evidences of indebtedness of such corporation,
trust, partnership, or similar business entity are rated 1 or 2 by the
securities valuation office of the national association of insurance
commissioners; |
| (b) |
The
corporation, trust, partnership, or similar business entity has not defaulted
in payment of interest or principal on any of its bonds, notes, debentures, or
other evidences of indebtedness during the five years immediately preceding the
date of purchase, and the average annual net earnings of such corporation,
trust, partnership, or similar business entity that are available for fixed
charges for not less than five fiscal years preceding such purchase have been
at least one and one-half times the average fixed charges of such corporation,
trust, partnership, or similar business entity for that period and during
either of the last two years of such period, the net earnings available for
fixed charges shall have been not less than one and one-half times the fixed
charges of such corporation, trust, partnership, or similar business entity for
such year. |
|
| (5) |
In common stocks or shares of any solvent
incorporated company organized under the laws of the United States, or of any
state, district, or territory thereof, or the Commonwealth of Puerto Rico,
provided that a dividend or distribution has been paid by the corporation in
the preceding twelve months upon such stock to be purchased, or that such
corporation, together with its predecessor corporation or corporations, has
been in existence for a period of at least five years. No domestic company
shall invest in common stock or shares under divisions (P)(5) and (R) of this
section a sum exceeding in the aggregate ten per cent of its admitted assets on
the preceding thirty-first day of December. |
| (6) |
In
the stocks, limited liability company membership interests, limited partnership
interests, or limited liability partnership interests of insurance, financial,
investment, and investment management companies, which investment management
companies are registered with the securities and exchange commission under the
"Investment Company Act of 1940," 54 Stat. 789, 15 80a-1, as amended, or the
stocks, limited liability company membership interests, limited partnership
interests, or limited liability partnership interests in an entity wholly owned
by a domestic company or by a domestic company and its affiliates, that is
formed and maintained to acquire or hold specific assets or liabilities for
bankruptcy remoteness or limitation of liability purposes, except its own
stock, but no domestic life insurance company shall invest in such stocks,
limited liability company membership interests, or limited liability
partnership interests under division (P)(6) of this section, exclusive of its
investments in stocks or limited liability company membership interests of
insurance company subsidiaries or subsidiaries engaged exclusively in the
ownership of insurance company subsidiaries, a sum exceeding the lesser of
fifty per cent of its policyholder surplus or ten per cent of its admitted
assets as of the preceding thirty-first day of December unless the approval of
the superintendent of insurance is first obtained. Whenever the superintendent
has reason to believe that the retention, investment, or acquisition of the
stock, limited liability company membership interest, limited partnership
interest, or limited liability partnership interest of any such company
substantially lessens competition generally in the business of insurance or
creates a monopoly therein the superintendent shall proceed under section
3901.13 of the Revised Code to cause such domestic insurance company to divest
itself of such stock, limited liability company membership interest, limited
partnership interest, or limited liability partnership interest. |
| (7) |
| (a) |
In
bonds, notes, debentures, or other evidences of indebtedness issued, assumed,
or guaranteed by a solvent corporation, trust, or partnership formed or
existing under the laws of a foreign jurisdiction, provided each such foreign
investment is of the same kind and quality as United States investments
authorized under this section; or in common or preferred stock, shares,
membership interest, or partnership interest of any solvent business entity
formed or existing under the laws of a foreign jurisdiction provided each such
foreign investment is of the same kind and quality as United States investments
authorized under this section; or in bonds or other evidences of indebtedness
issued, assumed, or guaranteed by a foreign jurisdiction. An insurer shall not
invest in foreign investments under division (P)(7) of this section, including
investments denominated in foreign currency, a sum exceeding in the aggregate
fifteen per cent of its admitted assets as of the preceding thirty-first day of
December. The aggregate amount of investments held by an insurer in a single
foreign jurisdiction shall not exceed three per cent of its admitted assets as
of the preceding thirty-first day of December. As used in division
(P)(7)(a) of this section, "foreign jurisdiction" means a jurisdiction outside
the United States, Puerto Rico, or Canada, whose
bonds are rated 1 by the securities valuation office of the national
association of insurance commissioners.
|
| (b) |
An
insurer may acquire investments denominated in foreign currency whether or not
they are foreign investments. An insurer shall not
invest in investments denominated in foreign currency a sum exceeding in the
aggregate ten per cent of its admitted assets as of the preceding thirty-first
day of December. The aggregate amount of investments denominated in a single
foreign currency held by an insurer shall not exceed three per cent of an
insurer's admitted assets as of the preceding thirty-first day of
December.
|
| (c) |
As used in division (P)(7) of this section,
"foreign currency" means a currency other than that of the United
States. |
|
| (8) |
An insurer may invest without limitation in
investments of government money market funds. As used in division (P)(8) of
this section, "government money market fund" means a mutual fund that at all
times invests in obligations issued, guaranteed, or insured by the federal
government of the United States, or collateralized repurchase agreements
comprised of these obligations, and that qualifies for investment without a
reserve pursuant to the purposes and procedures of the securities valuation
office of the national association of insurance commissioners. |
|
| (Q) |
In loans upon the pledge of any securities in
which such companies are authorized by this section to invest, provided that
any loan upon such a pledge shall not exceed eighty per cent of the cash market
value of the collateral at the time of the making of such loan and at the end
of each twelve-month period thereafter, and such company, through the
collateral pledged to it, shall not exceed the amounts which it may, under this
section, invest in one corporation so that, in the stocks and securities which
may be owned and those which are pledged to it, the limitations in this section
might be indirectly evaded; |
| (R) |
| (1) |
Any domestic legal reserve life insurance company may loan or invest its funds,
to an extent not exceeding in the aggregate five per cent of its total admitted
assets, in loans or investments not permitted under this section. Any such
company may also invest up to an additional five per cent of its total admitted
assets, in loans or investments in small businesses having more than half of
their assets or employees in this state and in venture capital firms having an
office within this state, provided that, as a condition of a company making an
investment in a venture capital firm, the firm must agree to use its best
efforts to make investments, in an aggregate amount at least equal to the
investment to be made by the company in that venture capital firm, in small
businesses having their principal offices within this state and having either
more than one-half of their assets within this state or more than one-half of
their employees employed within this state. As used in division (R)
of this section:
| (a) |
"Small
businesses" means any corporation, partnership, proprietorship, or other entity
that either does not have more than four hundred employees, or would qualify as
a small business for the purpose of receiving financial assistance from small
business investment companies licensed under the "Small Business Investment Act
of 1958," 72 Stat. 689, 15 U.S.C.A. 661, as amended, and rules of the small
business administration. |
| (b) |
"Venture capital firms" means any corporation, partnership, proprietorship, or
other entity, the principal business of which is or will be the making of
investments in small businesses. |
| (c) |
"Investments" means any equity investment, including limited partnership
interests and other equity interests in which liability is limited to the
amount of the investment, but does not include general partnership interests or
other interests involving general liability. |
|
| (2) |
In
the event that, subsequent to being made under provisions of division (R) of
this section, an investment is determined to have become qualified as an
investment for a domestic life insurance company as provided for in this
section, the company may consider such investment as held under the applicable
provisions of the foregoing divisions (A) to (Q) of this section and such
investment shall no longer be considered as having been made under the
provisions of this division. |
|
| (S) |
| (1) |
No
domestic life insurance company shall subscribe to or participate in any
underwriting for the purchase or sale of securities or property, nor shall it
enter into any such transaction for purchase or sale on account of said company
jointly with any other person, nor shall any such company enter into any
agreement to withhold from sale any of its property, but the disposition of its
property shall be at all times within the control of its board of directors.
Nothing contained in division (S)(1) of this section shall be construed to
invalidate or prohibit an agreement by an insurance company for the purchase
for its own account of an entire issue of the securities of a corporation or to
invalidate or prohibit an agreement by an insurance company and one or more
other investors to join and share in the purchase of investments for their
individual accounts and for bona fide investment purposes. |
| (2) |
In
the determination of capitalization in this section the value of all bonds,
debentures, and funded debts, and nonconvertible or nonparticipating preferred
stocks shall be figured at par. Participating or convertible preferred shares
shall be figured at par or market on the preceding thirty-first day of
December, whichever is higher, and the value of all common shares shall be
figured at the market on the preceding thirty-first day of December. |
| (3) |
As
used in this section:
| (a) |
"Funded
debt" means all interest-bearing obligations maturing in more than one year
from their issuance and all guaranteed or assumed interest-bearing obligations
or stock. Securities or stock of a corporation pledged to secure other funded
debt of the corporation are not included in the funded debt. |
| (b) |
"Fixed charges" include actual interest incurred in each year on funded and
unfunded debt and annual apportionment of debt discount or premium. Where
interest is partially or entirely contingent upon earnings, "fixed charges"
include contingent interest payments. |
| (c) |
"Net earnings available for fixed charges" means income after deducting
operating and maintenance expenses, taxes other than income taxes,
depreciation, and depletion. Extraordinary, nonrecurring items of income or
expense shall be excluded. |
|
| (4) |
Except as provided in a plan of mutualization adopted pursuant to the
provisions of sections 3913.01 to 3913.10 of the Revised Code, no domestic life
insurance company may invest in or loan upon its own stock, either directly or
indirectly. |
| (5) |
If the investments of any domestic life insurance
company are at the time of the making thereof or on October 13, 1953, otherwise
than as authorized in this section, such investments shall not be admitted or
accepted as authorized investments for such company. |
| (6) |
Any earnings test provided for in this section shall be deemed to have been met
if the requirements of such earnings test are met by any company which assumes
or guarantees the investment or which assumes or guarantees the performance of
any lease which is the security for the investment. In applying any such
earnings test, the operations of a company's predecessor companies, if any, for
the stipulated period shall be included. |
| (7) |
No
domestic life insurance company shall at any time have invested in or loaned
upon the security of the obligations, property, or securities of a particular
corporation, trust, partnership, or similar business entity a sum exceeding the
greater of two per cent of its admitted assets as of the preceding thirty-first
day of December or twenty-five per cent of that portion of its capital and
surplus, or its surplus in the case of a mutual company, that exceeds the
minimum required capital and surplus under section 3907.05 of the Revised Code
unless the approval of the superintendent of insurance is first obtained. The
restrictions of division (S)(7) of this section do not apply to divisions (C),
(F), (G), (H), (P)(6), and (R) of this section or to any valid obligation
issued, assumed, or guaranteed by the United States, or any state thereof, the
Commonwealth of Puerto Rico, the District of Columbia, or Canada or any
province of Canada. For purposes of division (S)(7) of this section, such
company may, at its option, consider either the lessor or the lessee under
division (L) of this section to be the person to whom any such investment or
loan is made. |
| (8) |
This section does not affect the propriety or
legality of an investment made by a domestic life insurance company which was
in accordance with the laws in force at the time of the making of the
investment. |
|
| (T) |
A domestic life insurance company may seek permission
from the superintendent of insurance to invest funds under Chapter 3906. of the
Revised Code and may invest funds under that chapter if such permission is
granted. |
| (U) |
As used in divisions (U)
and (V) of this section:
| (1) |
"Covered" means that an
insurer owns, or can immediately acquire through the exercise of options,
warrants, or conversion rights already owned, the underlying interest in order
to fulfill or secure its obligation under the option, cap, or floor it has
written. |
| (2) |
| (a) |
"Derivative instrument"
means an agreement, option, instrument, or a series or combination thereof of
either of the following types:
| (i) |
To make or take delivery of, or assume or relinquish,
a specified amount of one or more underlying interests, or to make a cash
settlement in lieu thereof; |
| (ii) |
That has a price, performance, value, or cash flow
based primarily upon the actual or expected price, level, performance, value,
or cash flow of one or more underlying interests. |
|
| (b) |
Derivative instruments include options, warrants,
caps, floors, collars, swaps, forwards, futures, and any other agreements,
options, or instruments substantially similar thereto or any series or
combination thereof. |
|
| (3) |
"Derivative transaction" means a transaction involving
the use of one or more derivative instruments. |
| (4) |
"Hedging transaction" means a derivative transaction
that is entered into and maintained to reduce either of the following:
| (a) |
The risk of economic loss due to a change in the
value, yield, price, cash flow, or quantity of assets or liabilities that the
insurer has acquired or incurred or anticipates acquiring or incurring; |
| (b) |
The currency exchange
rate risk or the degree of exposure as to assets or liabilities that an insurer
has acquired or incurred or anticipates acquiring or incurring. |
|
| (5) |
"Income generation" means
a derivative transaction involving the writing of covered options, caps, or
floors that is intended to generate income or enhance return. |
| (6) |
"Replication transaction" means a derivative
transaction that is intended to replicate the performance of one or more assets
that an insurer is authorized to acquire under this chapter. "Replication
transaction" does not include a derivative transaction that is entered into as
a hedging transaction. |
|
| (V) |
| (1) |
Prior to an insurer entering into derivative
transactions, the board of directors of the insurer shall approve a derivative
use plan. |
| (2) |
An insurer shall notify
the superintendent of insurance in writing within three days after identifying
either of the following:
| (a) |
Any event or occurrence
related to an insurer's derivatives use that may lead to a material change to
the insurer's policyholder surplus; |
| (b) |
Any event or occurrence related to an insurer's
derivatives use that, with the passage of time, may lead to a material change
to the insurer's policyholder surplus. |
|
| (3) |
Prior to entering into derivative transactions, an
insurer shall file with the superintendent a copy of its derivative use plan
and internal controls, for informational purposes. The insurer shall keep
current the copy of its derivative use plan and internal controls filed with
the superintendent. The insurer shall not enter into derivative transactions
until thirty calendar days after the date on which the derivative use plan and
internal controls is filed with the superintendent. This thirty-calendar-day
period is to begin on the date that the superintendent receives the derivative
use plan and internal controls. |
| (4) |
The superintendent may adopt rules prescribing the
form and content of derivative use plans, as well as any internal controls the
superintendent considers necessary. |
| (5) |
An insurer that engages in hedging transactions or
replication transactions shall do both of the following:
| (a) |
Maintain its position in any outstanding derivative
instrument used as part of a hedging transaction or replication transaction for
as long as the hedging transaction or replication transaction continues to be
effective; |
| (b) |
Demonstrate to the
superintendent, upon request, that any derivative transaction entered into and
involving hedging transaction or replication transaction is an effective
hedging transaction or replication transaction. The insurer must be able to
demonstrate this at the time the derivative transaction is entered into, and
for as long as the transaction continues to be in place. |
|
| (6) |
An insurer may not invest
in, or use, a derivative instrument for any purpose other than a hedging
transaction, income generation, or replication. |
| (7) |
An insurer shall not invest in, or use a derivative
instrument for purposes of income generation in a sum exceeding in the
aggregate five per cent of its admitted assets, as of the preceding
thirty-first day of December. |
| (8) |
All documents provided to the superintendent under
division (V) of this section shall be deemed trade secrets and shall be
provided with trade secret protection. Such documents shall also be considered
work papers of the superintendent that are subject to section 3901.48 of the
Revised Code and are confidential and privileged and shall not be considered a
public record, as defined in section 149.43 of the Revised Code. The original
documents and any copies of them shall not be subject to subpoena and shall not
be made public by the superintendent or any other person, except as otherwise
provided in section 3901.48 of the Revised Code. |
|
Amended by
130th General Assembly File No. TBD, SB 140, §1,
eff. 9/4/2014.
Amended by
129th General AssemblyFile No.124, HB 341,
§1, eff.
9/6/2012.
Effective Date: 10-31-2001
.
| (A) |
Any
securities described in section 77r-1 of the "Secondary Mortgage Market
Enhancement Act of 1984," 98 Stat. 1689,
15 U.S.C.A. 77r-1, shall be subject to all limitations
prescribed in section
3907.14 of the Revised Code for
investments not guaranteed by the full faith and credit of the United States.
|
| (B) |
Notwithstanding division (A)
of this section, on and after August 8, 1991, a domestic life insurance company
may invest in any of the following securities, subject to any applicable
limitations contained in rules adopted by the superintendent of insurance:
| (1) |
Securities offered and sold pursuant to
15 U.S.C.A. section 77d(5) ; |
| (2) |
Mortgage related securities described in
15 U.S.C.A. section 78c(a)(41) ; |
| (3) |
Securities issued or guaranteed by the
federal home loan mortgage corporation or the federal national mortgage
association. |
|
Effective Date:
01-31-1992 .
| (A) |
A domestic
life insurance company may, subject to section
3911.011
of the Revised Code, issue policies, annuities, or other contracts, whether on
an individual or group basis, providing benefits or other contractual payments
payable in fixed or variable dollar amounts, or both, and allocate to one or
more separate accounts any amounts which are to be applied to provide such
benefits and contractual payments. The income, if any, and any gains or losses,
realized or unrealized, on each separate account shall be credited to or
charged against the amounts allocated to the separate account without regard to
other income, gains, or losses of the company. The amounts allocated to the
separate accounts and the accumulations thereon remain the property of the
company, but that portion of the assets of the separate accounts equal to the
reserves and other contractual liabilities under all policies, annuities, and
other contracts identified with the separate accounts shall not be chargeable
with liabilities arising out of any other business of the company. The company
shall not be, or hold itself out to be, a trustee in respect of such
amounts. |
| (B) |
| (1) |
Not
more than ten per cent of the amounts allocated to any separate account and the
accumulations thereon shall be invested in the stocks, notes, debentures,
bonds, or other securities of any one corporation or issuer and not more than
ten per cent of the issued and outstanding voting securities of any one
corporation or issuer may be acquired by all separate accounts. The
superintendent of insurance may waive this limitation if, in the opinion of the
superintendent, the waiver will not render the operation of the separate
account hazardous to the public or policyholders in this state; |
| (2) |
Division (B)(1) of this section does not apply to any of the following:
| (a) |
Securities of investment companies registered under the "Investment Company Act
of 1940," 54 Stat. 789,
15 U.S.C.A. 80a-1, as amended; |
| (b) |
Annuities or funding agreements issued by a life insurance company authorized
to do business in this state from its general account; |
| (c) |
The
transfer of any investment or other asset in any separate account to any other
account or to the general assets of the company or any investment among the
general assets of the company transferred to any separate account; |
| (d) |
Securities issued or guaranteed as to principal or interest by the United
States. |
|
|
| (C) |
No
security of any corporation which is a subsidiary of, or which is affiliated
through stock ownership with, such insurance company shall be allocated to any
separate account. No investment or other asset in any separate account shall be
transferred to any other account or to the general assets of the company and no
investment among the general assets of the company shall be transferred to any
separate account unless such transfer is made solely:
| (1) |
To
establish a separate account or support the guarantees of the policies,
annuities, or other contracts identified with such account; |
| (2) |
To
withdraw amounts previously allocated to any separate account which are no
longer needed to support the guarantees of the policies, annuities, or other
contracts identified therewith; and such transfer is of cash or securities
having a readily determinable market value or unless such transfer is approved
by the superintendent. If a company withdraws all or part of its participation
in a separate account, it shall be entitled to receive its proportionate share
of the value of the assets of the separate account at the time of
withdrawal. |
|
| (D) |
The assets
of a separate account shall be valued at their market value on the date of
valuation, or if there is no readily available market, then in accordance with
the terms of the contracts or the rules or other written agreement applicable
to such separate account. |
| (E) |
Notwithstanding division (D) of this section, assets
supporting fund accumulation contracts, which do not participate in the
underlying portfolio experience, with a fixed interest rate guarantee,
purchased under a retirement plan or plan of deferred compensation, established
or maintained by an employer, may be recorded as if the assets were held in the
general account. |
| (F) |
The amounts
allocated to any separate account under this section and the accumulations
thereon may be invested and reinvested by the company without regard to the
requirements and limitations of section
3907.14
of the Revised Code. |
| (G) |
The assets of a separate account shall not be
taken into account in applying the investment requirements and limitations of
section
3907.14
of the Revised Code to other investments of the company. |
| (H) |
Any such
domestic life insurance company may do all things necessary under any state or
federal law in order that such policies, annuities, or other contracts may be
lawfully offered for sale and sold, including, but not limited to, the granting
of voting rights to such policyholders, annuitants, and other contract holders
with respect to the management of such separate accounts and investment of the
assets thereof and the establishment of committees, boards, or other similar
designated bodies with respect to such separate accounts as may be required by
such laws, notwithstanding Chapter 3907. or section
3913.06
of the Revised Code, or the articles of incorporation, charter, bylaws, or code
of regulations of such company. |
Amended by
133rd General Assembly File No. TBD, HB 339, §1,
eff. 1/1/2021.
Effective Date:
03-03-1996;
10-12-2006 .
Effective Date:
10-13-1953 .
Actions may be maintained by an insurance company formed under
the laws of this state, against any of its members, officers, policyholders, or
stockholders, for any cause relating to its business; and actions may be
prosecuted and maintained by any member, stockholder, or policyholder, or the
heirs or legal representative of any of these, against the company for losses
which accrue on any risk, if payment is withheld more than two months after the
losses become due.
Effective Date:
10-01-1953 .
The directors, managers, or officers of any legal reserve life
insurance company organized under the laws of this state shall not, directly or
indirectly, make or pay a dividend, or pay any interest, bonus, or other
allowances in lieu thereof, to its stockholders, except from surplus funds
which exist after setting aside an amount equal to the reserve on all its
outstanding risks and policies, calculated by the American Experience Table,
with interest at four per cent annually, or calculated by any other higher
standard that the company has adopted, and the unearned premium on all personal
accident and sickness insurance.
Effective Date:
10-01-1953 .
The president or vice-president, and the secretary or actuary,
or a majority of the directors of each insurance company organized under the
laws of this state, annually on the first day of January, or within sixty days
thereafter, shall prepare under oath and deposit in the office of the
superintendent of insurance, a statement showing the condition of the company
on the thirty-first day of the December next preceding. The statement shall be
submitted on the forms adopted by the superintendent pursuant to section
3901.77 of the Revised Code, and
shall exhibit the following items:
| (A) |
The number of policies issued during the year;
|
| (B) |
The amount of insurance
effected by such policies; |
| (C) |
The amount of premiums received during the year; |
| (D) |
The amount of interest and all other receipts,
specifying the items; |
| (E) |
The
amount paid to policyholders of the company for losses during the year;
|
| (F) |
The amount of all other
expenditures and disbursements of the company, specifying such items as the
superintendent calls for; |
| (G) |
The
amount of losses unpaid; |
| (H) |
The
whole number of policies in force; |
| (I) |
The amount insured by such policies; |
| (J) |
The amount of reserve on all policies in
force, calculated by the American Experience Table of Mortality, with interest
at four per cent annually, or calculated by any other higher standard that the
company has adopted, and the unearned premium on all personal accident and
sickness insurance in force; |
| (K) |
The amount of capital stock, specifying amount paid and unpaid; |
| (L) |
The amount of dividends unpaid and the
amount of all other liabilities; |
| (M) |
A detailed statement of all the assets of the
company, and the manner of their investment; |
| (N) |
An exhibit of the policy obligations of the
company, which shall include:
| (1) |
In the
first annual statement, a schedule showing the number, date, age when insured,
amount insured, term of policy, term of premium, and amount of premium, of all
policies issued, schedules of all policies canceled, revived, changed, reduced,
or increased and a schedule of reinsurances in other companies; |
| (2) |
In every succeeding annual statement, a
schedule of the items listed in division (N)(1) of this section as to all
policies issued during the year, and similar schedules of policies canceled,
revived, changed, reduced, or increased during the year, together with
schedules of reinsurances in other companies and schedules of additions to
policies, and a list of all other obligations of the company requiring
valuation. An exhibit of the policy obligations of the company may be
required more often than once a year.
|
|
Effective Date:
09-01-2002 .
| (A) |
All
investments shall be valued in accordance with the valuation standards
published by the national association of insurance commissioners. Securities investments for which the national association of
insurance commissioners has not published valuation standards in its valuations
of securities manual, or any successor publication, shall be valued as follows:
| (1) |
All obligations having a fixed
term and rate shall, if not in default as to principal and interest be valued
as follows:
| (a) |
If purchased at par, at the
par value; |
| (b) |
If purchased above
or below par, on the basis of the purchase price adjusted so as to bring the
value to par at maturity and so as to yield in the meantime the effective rate
of interest at which the purchase was made. |
|
| (2) |
Common, preferred, or guaranteed stocks
shall be valued at their market value. |
| (3) |
Any other securities investments shall be
valued in accordance with the rules adopted by the superintendent of insurance
under division (C) of this section. Any other investment, including real property, for which the
national association of insurance commissioners has not published valuation
standards shall be valued in accordance with the rules adopted by the
superintendent under division (C) of this section. Such an investment shall not
be valued at more than its purchase price, except that an investment that has
been affected by a permanent decline in value shall be valued at not more than
its market value. With respect to real property, purchase price includes
capitalized permanent improvements, less depreciation spread evenly over the
life of the property.
|
|
| (B) |
Any investment, including real property, that is
acquired by an insurance company in satisfaction of a debt, or that is
otherwise acquired by an insurance company other than by purchase, shall be
valued in accordance with the standards set forth in division (A) of this
section for that type of investment. For purposes of applying the valuation
standards, the purchase price shall be deemed to be the market value less the
estimated costs of disposal at the time the investment is acquired or, in the
case of any investment acquired in satisfaction of a debt, the amount of the
debt, including interest, taxes, and expenses, whichever amount is less.
|
| (C) |
The superintendent shall
adopt rules in accordance with Chapter 119. of the Revised Code to establish
standards for the determination and calculation of values, for purposes of use
in statutory financial statements submitted to the department of insurance, for
those investments for which the national association of insurance commissioners
has not published valuation standards. |
Effective Date:
08-08-1991 .
All companies organized under any law of this state shall
continue to be corporations for the purpose for which they were chartered, but
they shall be subject to all the provisions, requirements, and penalties
imposed on companies organized under sections
3907.01 to 3907.21, inclusive, of
the Revised Code, and shall be entitled to all the benefits and privileges of
such sections and sections
3911.01 to
3911.24, inclusive, of the Revised
Code.
Effective Date:
10-01-1953 .