Chapter 3925: DOMESTIC INSURANCE COMPANIES OTHER THAN LIFE

3925.01 Approval and recording of articles.

The articles of incorporation of a company formed for the purpose of insurance, other than life insurance, must be forwarded to the secretary of state, who shall submit them to the attorney general for examination. If such articles are found by him to be in accordance with the constitution and laws of this state and of the United States, he shall certify and deliver them back to the secretary of state. He may reject any name or title of a company applied for when he deems it similar to one already appropriated, or likely to mislead the public.

Upon the approval of the articles by the attorney general and the secretary of state, the latter shall cause them to be recorded and copied in the manner provided for life insurance companies, and a copy thereof to be deposited with the superintendent of insurance. He shall withhold from the company the certificate of authority if its name is so similar to that of any other company as to mislead the public.

Cite as R.C. § 3925.01

Effective Date: 10-01-1953

3925.02 Subscription to stock.

The persons named in the articles of incorporation of a company formed for the purpose of insurance other than life, or a majority of such persons, shall be commissioners to open books for the subscription of stock in the company, at such times and places as they deem proper, and shall keep the books open until the full amount specified in the articles is subscribed.

Cite as R.C. § 3925.02

Effective Date: 10-01-1953

3925.03 Election of directors and officers.

Within one month after the subscription books of a stock insurance company are filled, as provided in section 3925.02 of the Revised Code, and after the articles of incorporation of a stock insurance company are filed with the secretary of state, a majority of subscribers to the voting stock shall hold a meeting for the election of not less than five nor more than twenty-one directors. The number of directors may be increased or diminished between the same limits by amendment of the code of regulations or bylaws, if the number of directors is included in the code of regulations or bylaws of the company, or pursuant to a vote of the stockholders representing a majority of the stock voting, in person or by proxy, at a meeting, if the number of directors is included in the articles of incorporation of the company. No reduction in the number of directors shall of itself have the effect of shortening the term of any incumbent director. Each stockholder is entitled to one vote for each share of voting stock held.

The directors of a stock insurance company shall choose, by ballot, a president, and also fill vacancies that arise in the board, or in the presidency of the company.

Cite as R.C. § 3925.03

Effective Date: 06-18-2002

3925.04 Other officers - bylaws and regulations.

When convened at the office of the company, the board of directors elected or appointed as provided in section 3925.03 or 3941.05 of the Revised Code, or a majority of the board, may appoint a secretary and other officers or agents necessary for transacting its business, and may pay such salaries and take such securities as the board considers reasonable. The board may ordain and establish bylaws and a code of regulations, or make amendments to the bylaws or code of regulations previously adopted, not inconsistent with the constitution and laws of this state and of the United States, which appear necessary for regulating and conducting the business of the company. New bylaws or regulations shall not take effect until approved by the superintendent of insurance and until a copy thereof is filed in the superintendent's office. The board shall keep full and correct records of its transactions, which shall be open at all times to the inspection of the members or stockholders.

Cite as R.C. § 3925.04

Effective Date: 06-18-2002

3925.05 Investment of capital.

No insurance company organized under any law of this state for the purpose provided in section 3925.01 of the Revised Code shall invest its capital, or any part thereof, otherwise than in the following securities:

(A) Bonds or other interest-bearing obligations of the United States, or those for which the faith of the United States is pledged to provide payment of the interest and principal;

(B) Bonds of this or of any other state or the District of Columbia, or those for which the faith of the state or the District of Columbia is pledged to provide payment of the interest and principal;

(C)

(1) Legally authorized and executed bonds, notes, warrants, and securities or other interest-bearing obligations which are direct obligations of any county, incorporated city, town, village, or any other political subdivision, or municipal corporation of any state or of the District of Columbia which has not defaulted for a period of more than one hundred twenty days in the payment of interest upon, or for a period of more than one year in the payment of principal of, any of its bonds, notes, warrants, securities, or other interest-bearing obligations, during the ten years immediately preceding the acquisition of such bonds, notes, warrants, securities, or other interest-bearing obligations, and provided that such county, incorporated city, town, village, or political subdivision or municipal corporation has lawful authority to levy taxes for the payment of such bonds, notes, warrants, securities, or other interest-bearing obligations;

(2) Legally authorized and executed bonds, notes, warrants, and other interest-bearing securities of any school district, water district, road district; or any special district of any state or of the District of Columbia, provided that such school district, water district, road district, or special district has been created by legislative action and is empowered to levy taxes on all taxable property in such district for the payment of such bonds, notes, warrants, and other interest-bearing securities, and provided that such school district, water district, road district, or special district has not defaulted for a period of more than one hundred twenty days in the payment of interest upon, or for a period of more than one year in the payment of principal of, its bonds, notes, warrants, and other interest-bearing securities, during the ten years immediately preceding the acquisition of such bonds, notes, warrants, and other interest-bearing securities;

(D)

(1) Bonds and mortgages on unencumbered real estate within this or any other state, worth double the amount loaned thereon, provided that if the amount loaned exceeds one-half the value of the land mortgaged, exclusive of structures thereon, such structures must be insured in an authorized fire insurance company, other than the company making the loan, in an amount not less than the difference between half the value of such land exclusive of structures and the amount loaned, and the policy must be assigned to the mortgagee;

(2) Bonds or notes secured by mortgages insured by the federal housing administrator or the secretary of agriculture of the United States under Title I of "The Bankhead-Jones Farm Tenant Act" as amended;

(E) The stock of a national bank located in this state, organized under an act of congress entitled "An act to provide a national currency, secured by the pledge of United States stocks, and to provide for the circulation and redemption thereof," approved February 25, 1863, and acts amendatory thereof and supplementary thereto;

(F) First mortgage bonds of railroads upon which default in the payment of the interest coupons has not been made within three years prior to the purchase thereof by such insurance company.

Cite as R.C. § 3925.05

Effective Date: 09-30-1955

3925.06 Additional investments.

In addition to the investments provided by law, investments in any of the following securities are authorized investments for the capital and accumulations of insurance companies, both life and other than life, which are organized under the laws of this state, subject to the regulations governing other investments by such companies:

(A) 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 and amendment thereto; 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 and amendments thereto;

(B) Notes, bonds, debentures, and other such obligations issued by the federal housing administrator;

(C) Bonds issued under the "Home Owners' Loan Act of 1933," 48 Stat. 128, 12 U.S.C. 1461 .

Cite as R.C. § 3925.06

Effective Date: 01-10-1961

3925.07 Deposit of securities.

Whenever a deposit of securities is required from a domestic or foreign insurance company, either life or other than life, as a condition upon which such company may transact business in this state, the following securities may be deposited for that purpose in addition to other securities specified by law:

(A) 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 and amendments thereto; 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 and amendments thereto;

(B) Notes, bonds, debentures, and other such obligations issued or insured by the federal housing administrator;

(C) Notes secured by mortgages insured by the secretary of agriculture of the United States under Title I of "The Bankhead-Jones Farm Tenant Act," 50 Stat. 522, 7 U.S.C. 1000 as amended;

(D) Bonds issued under the "Home Owners' Loan Act of 1933," 48 Stat. 128, 12 U.S.C. 1461 .

Cite as R.C. § 3925.07

Effective Date: 01-10-1961

3925.08 [Effective Until 9/4/2014] Investment of accumulated funds or surplus.

Funds accumulated in the course of business, or surplus money above the capital stock, of any company organized under any law of this state, for the purpose provided in section 3925.01 of the Revised Code, shall only be loaned or invested in the securities listed in sections 3925.05 and 3925.06 of the Revised Code, or in the following:

(A)

(1) Bonds and mortgages on unencumbered real estate within this or any other state worth twenty-five per cent more than the sum loaned thereon, exclusive of buildings, unless such buildings are insured in some company authorized to do business in this state, and the policy is transferred to the company making the investment; or, in lieu of transferring such policies, 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 insurance company, insurance in the amount required by this section;

(2) Bonds or notes secured by mortgages insured by the federal housing administrator;

(3) 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. 693, as amended, provided such guaranteed loans are liens upon real estate.

(B)

(1) Legally authorized and executed bonds, notes, warrants, and securities which are the direct obligation of or are guaranteed as to both principal and interest 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 municipal corporation of Canada having a population of one hundred thousand or more by the latest official census, and which are not in default as to principal or interest;

(2) 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 similar development bank in which the president, as authorized by congress and on behalf of the United States, has accepted membership.

(C) 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, 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, or 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, 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, and in any bonds or obligations issued or guaranteed by the United States, any state, the District of Columbia, the Commonwealth of Puerto Rico, any county, municipal corporation, district, political subdivision, civil division, commission, board, authority, agency, or other instrumentality of one or more of them, provided there is a specific pledge of revenues, earnings, or other adequate security and provided that no prior or parity obligation of the same issuer, payable from revenues or earnings from the same source, has been in default as to principal or interest during the five years next preceding the date of such investment, but such issuer need not have been in existence for that period, and obligations acquired under this section may be newly issued, and further provided that there is adequate provision for payment of expenses of operation and maintenance and the principal and interest on all obligations when due;

(D)

(1) Bonds or other evidences of indebtedness, bearing or accruing interest, issued, assumed, or guaranteed by any solvent corporation, trust, partnership, or similar business entity organized and existing under the laws of this or any other state, or of the United States, the Commonwealth of Puerto Rico, or of the District of Columbia, or of Canada or any province of Canada, upon which there is no existing interest or principal default, provided that either:

(a) The bonds or other evidences of indebtedness are rated 1 or 2 by the securities valuation office of the national association of insurance commissioners;

(b) The corporation, together with its predecessor corporation or corporations, or the trust, partnership, or similar business entity, has been in existence for a period of at least five years.

(2) Stocks , limited liability company membership interests, limited partnership interests, or limited liability partnership interests of any insurance, financial, investment, or 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 U.S.C. 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, and stocks , limited liability company membership interests, limited partnership interests, limited liability partnership interests, bonds, notes, and debentures of any company which is organized for, and limited in its operations to, the financing of insurance premiums, upon approval of such investments by the superintendent of insurance; except that approval shall not be required for the purchase of the outstanding stocks , limited liability company membership interests, limited partnership interests, or limited liability partnership interests of any such company, if investment in each such company does not exceed in the aggregate two and one-half per cent of the total admitted assets of the company making the investment as of the preceding thirty-first day of December. 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.

(3) Other stocks, limited liability company membership interests, or limited partnership interests, or limited liability partnership interests of any solvent corporation organized under the laws of this or any other state, or of the United States, or of the District of Columbia, or of Canada or any province of Canada, provided that a dividend or distribution has been paid by the business entity in the preceding twelve months upon the stock, membership interest, or partnership interest to be purchased or such business entity, together with its predecessor entity or entities, has been in existence for a period of at least five years.

(4) 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.

(5) 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 such debt obligation is secured by a first lien on tangible personal property which is purchased or secured for payment thereof and such 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.

(6) An insurer may invest without limitation in investments of government money market funds. As used in division (D)(6) of this section, "government money market fund" means a 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 such 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.

(E) Negotiable promissory notes maturing in not more than six months from the date thereof, secured by collateral security through the transfer of any of the classes of securities described in this section or in sections 3925.05 and 3925.06 of the Revised Code, with absolute power of sale within twenty days after default in payment at maturity;

(F)

(1) Repurchase agreements with, and interest-bearing obligations, including savings accounts and time certificates of deposit of, a national bank of the United States, a commonwealth bank of Puerto Rico, a chartered bank of Canada, or a state bank, provided such bank is either a member of the federal deposit insurance corporation created pursuant to the "Banking Act of 1933," as amended, or the Canada deposit insurance corporation created pursuant to the act of parliament known as the "Canada Deposit Insurance Corporation Act," as amended.

(2) Certificates of deposit, savings share accounts, investment share accounts, stock deposits, stock certificates, or other evidences of indebtedness of a savings and loan association, provided all such evidences of indebtedness 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;

(3) Bankers' acceptances and bills of exchange of the kinds and maturities made eligible by law for rediscount with the federal reserve banks, provided that the same 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.

(G) Any securities issued as a result of any reorganization, or capital or debt adjustment, in whole or in part, in exchange for securities acquired by it prior to such reorganization, or capital or debt adjustment;

(H)

(1) 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 interests, or partnership interests 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 (H) 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 (H)(1) 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.

(2) 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 fifteen 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.

(3) As used in division (H) of this section, "foreign currency" means a currency other than that of the United States.

(I)

(1) Any securities or other property not permitted under section 3925.05 , 3925.06 , 3925.08, or 3925.20 of the Revised Code to an extent not exceeding in the aggregate six per cent of the total admitted assets of such company on the preceding thirty-first day of December, within the limitations prescribed in division (J) of this section. Any such company may also invest up to an additional five per cent of the total admitted assets of such company on the preceding thirty-first day of December, within the limitations prescribed in division (J) of this section, 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 (I) 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 this division, a loan or investment is determined to have become qualified as a loan or investment under any of the divisions (A) to (F) of this section or under section 3925.05 , 3925.06 , or 3925.20 of the Revised Code, the company may consider such loan or investment as held under such other statutory provision and such loan or investment shall no longer be considered as having been made under this division.

(J) No domestic insurance company shall at any time have invested a sum exceeding five per cent of its admitted assets as of the preceding thirty-first day of December in the bonds, notes, debentures, other evidences of indebtedness, and stocks of a particular corporation, trust, partnership, or similar business entity, except for investments authorized under divisions (A) and (D)(2) of this section, and no domestic insurance company together with its subsidiary, if any, shall at any time own directly or indirectly more than twenty-five per cent of the outstanding bonds, notes, debentures, other evidences of indebtedness, and stocks of any corporation, except for investments authorized under divisions (A) and (D)(2) of this section.

This section does not affect the propriety or legality of an investment made by such domestic insurance company which was in accordance with the laws in force at the time of the making of the investment.

Cite as R.C. § 3925.08

Amended by 129th General AssemblyFile No.124, HB 341, §1, eff. 9/6/2012.

Effective Date: 10-31-2001

3925.08 [Effective 9/4/2014] Investment of accumulated funds or surplus.

Funds accumulated in the course of business, or surplus money above the capital stock, of any company organized under any law of this state, for the purpose provided in section 3925.01 of the Revised Code, shall only be loaned or invested in the securities listed in sections 3925.05 and 3925.06 of the Revised Code, or in the following:

(A)

(1) Bonds and mortgages on unencumbered real estate within this or any other state worth twenty-five per cent more than the sum loaned thereon, exclusive of buildings, unless such buildings are insured in some company authorized to do business in this state, and the policy is transferred to the company making the investment; or, in lieu of transferring such policies, 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 insurance company, insurance in the amount required by this section;

(2) Bonds or notes secured by mortgages insured by the federal housing administrator;

(3) 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. 693, as amended, provided such guaranteed loans are liens upon real estate.

(B)

(1) Legally authorized and executed bonds, notes, warrants, and securities which are the direct obligation of or are guaranteed as to both principal and interest 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 municipal corporation of Canada having a population of one hundred thousand or more by the latest official census, and which are not in default as to principal or interest;

(2) 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 similar development bank in which the president, as authorized by congress and on behalf of the United States, has accepted membership.

(C) 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, 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, or 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, 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, and in any bonds or obligations issued or guaranteed by the United States, any state, the District of Columbia, the Commonwealth of Puerto Rico, any county, municipal corporation, district, political subdivision, civil division, commission, board, authority, agency, or other instrumentality of one or more of them, provided there is a specific pledge of revenues, earnings, or other adequate security and provided that no prior or parity obligation of the same issuer, payable from revenues or earnings from the same source, has been in default as to principal or interest during the five years next preceding the date of such investment, but such issuer need not have been in existence for that period, and obligations acquired under this section may be newly issued, and further provided that there is adequate provision for payment of expenses of operation and maintenance and the principal and interest on all obligations when due;

(D)

(1) Bonds or other evidences of indebtedness, bearing or accruing interest, issued, assumed, or guaranteed by any solvent corporation, trust, partnership, or similar business entity organized and existing under the laws of this or any other state, or of the United States, the Commonwealth of Puerto Rico, or of the District of Columbia, or of Canada or any province of Canada, upon which there is no existing interest or principal default, provided that either:

(a) The bonds or other evidences of indebtedness are rated 1 or 2 by the securities valuation office of the national association of insurance commissioners;

(b) The corporation, together with its predecessor corporation or corporations, or the trust, partnership, or similar business entity, has been in existence for a period of at least five years.

(2) Stocks, limited liability company membership interests, limited partnership interests, or limited liability partnership interests of any insurance, financial, investment, or 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 U.S.C. 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, and stocks, limited liability company membership interests, limited partnership interests, limited liability partnership interests, bonds, notes, and debentures of any company which is organized for, and limited in its operations to, the financing of insurance premiums, upon approval of such investments by the superintendent of insurance; except that approval shall not be required for the purchase of the outstanding stocks, limited liability company membership interests, limited partnership interests, or limited liability partnership interests of any such company, if investment in each such company does not exceed in the aggregate two and one-half per cent of the total admitted assets of the company making the investment as of the preceding thirty-first day of December. 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.

(3) Other stocks, limited liability company membership interests, or limited partnership interests, or limited liability partnership interests of any solvent corporation organized under the laws of this or any other state, or of the United States, or of the District of Columbia, or of Canada or any province of Canada, provided that a dividend or distribution has been paid by the business entity in the preceding twelve months upon the stock, membership interest, or partnership interest to be purchased or such business entity, together with its predecessor entity or entities, has been in existence for a period of at least five years.

(4) 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.

(5) 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 such debt obligation is secured by a first lien on tangible personal property which is purchased or secured for payment thereof and such 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.

(6) An insurer may invest without limitation in investments of government money market funds. As used in division (D)(6) of this section, "government money market fund" means a 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 such 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.

(E) Negotiable promissory notes maturing in not more than six months from the date thereof, secured by collateral security through the transfer of any of the classes of securities described in this section or in sections 3925.05 and 3925.06 of the Revised Code, with absolute power of sale within twenty days after default in payment at maturity;

(F)

(1) Repurchase agreements with, and interest-bearing obligations, including savings accounts and time certificates of deposit of, a national bank of the United States, a commonwealth bank of Puerto Rico, a chartered bank of Canada, or a state bank, provided such bank is either a member of the federal deposit insurance corporation created pursuant to the "Banking Act of 1933," as amended, or the Canada deposit insurance corporation created pursuant to the act of parliament known as the "Canada Deposit Insurance Corporation Act," as amended.

(2) Certificates of deposit, savings share accounts, investment share accounts, stock deposits, stock certificates, or other evidences of indebtedness of a savings and loan association, provided all such evidences of indebtedness 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;

(3) Bankers' acceptances and bills of exchange of the kinds and maturities made eligible by law for rediscount with the federal reserve banks, provided that the same 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.

(G) Any securities issued as a result of any reorganization, or capital or debt adjustment, in whole or in part, in exchange for securities acquired by it prior to such reorganization, or capital or debt adjustment;

(H)

(1) 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 interests, or partnership interests 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 (H) 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 (H)(1) 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.

(2) 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 fifteen 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.

(3) As used in division (H) of this section, "foreign currency" means a currency other than that of the United States.

(I)

(1) Any securities or other property not permitted under section 3925.05, 3925.06, 3925.08, or 3925.20 of the Revised Code to an extent not exceeding in the aggregate six per cent of the total admitted assets of such company on the preceding thirty-first day of December, within the limitations prescribed in division (J) of this section. Any such company may also invest up to an additional five per cent of the total admitted assets of such company on the preceding thirty-first day of December, within the limitations prescribed in division (J) of this section, 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 (I) 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 this division, a loan or investment is determined to have become qualified as a loan or investment under any of the divisions (A) to (F) of this section or under section 3925.05, 3925.06, or 3925.20 of the Revised Code, the company may consider such loan or investment as held under such other statutory provision and such loan or investment shall no longer be considered as having been made under this division.

(J) No domestic insurance company shall at any time have invested a sum exceeding five per cent of its admitted assets as of the preceding thirty-first day of December in the bonds, notes, debentures, other evidences of indebtedness, and stocks of a particular corporation, trust, partnership, or similar business entity, except for investments authorized under divisions (A) and (D)(2) of this section, and no domestic insurance company together with its subsidiary, if any, shall at any time own directly or indirectly more than twenty-five per cent of the outstanding bonds, notes, debentures, other evidences of indebtedness, and stocks of any corporation, except for investments authorized under divisions (A) and (D)(2) of this section.

This section does not affect the propriety or legality of an investment made by such domestic insurance company which was in accordance with the laws in force at the time of the making of the investment.

A business entity organized for the purpose provided in section 3925.01 of the Revised Code 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.

(K) As used in divisions (K) and (L) 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 interest, 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.

(L)

(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 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 (L) 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.

Cite as R.C. § 3925.08

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

3925.081 Investing in mortgage related securities.

(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 3925.08 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 insurance company other than life 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.

Cite as R.C. § 3925.081

Effective Date: 01-31-1992

3925.09 Limitations on certain investments.

No insurance company shall own more than one fourth of the capital stock of a national bank, nor invest in or loan on the stocks and bonds, both included, of any railroad company, to an extent exceeding one fifth of its own capital and surplus, nor in the aggregate shall the investment in and loan on all railroad property exceed one fourth of its own capital and surplus. Not more than one half of its capital and surplus shall be loaned on mortgages of real estate, as provided in sections 3925.05 of the Revised Code for the investment thereof, and not more than one tenth of the capital and surplus actually existing of such a company shall be invested in a single mortgage. The current market value of the evidences of indebtedness mentioned in this section, in which the accumulations or surplus money above the capital stock of an insurance company may be loaned or invested, must be at all times during the continuance of the loans at least twenty per cent more than the sum loaned thereon.

Cite as R.C. § 3925.09

Effective Date: 03-03-1996

3925.10 Liability of directors.

If an investment or loan is made by an insurance company in a manner not authorized by sections 3925.01 to 3925.34 , inclusive, of the Revised Code, the directors who make or authorize such investment or loan shall be personally liable to the stockholders for any loss occasioned thereby.

Cite as R.C. § 3925.10

Effective Date: 10-01-1953

3925.101 Regulation of foreign branches of domestic companies.

With the approval of the superintendent of insurance, sections 3925.06 to 3925.09 and 3925.20 of the Revised Code shall not apply to a domestic insurance company that qualifies as a foreign country branch of a United States company that writes policies exclusively in countries other than the United States if those other countries have laws pertaining to insurance company investments and the foreign country branch is required to comply with those laws.

Cite as R.C. § 3925.101

Effective Date: 2008 HB562 09-22-2008

3925.11 Examination of company - renewal of license.

When an insurance company notifies the superintendent of insurance that sections 3925.01 to 3925.03 , inclusive, of the Revised Code, have been complied with, he shall make an examination of its condition, and if he finds that the capital required of the company has been paid in and is possessed by it in money, or in stocks, bonds, and mortgages as required by sections 3925.05 and 3925.06 of the Revised Code, he shall so certify. The superintendent may cause such examination to be made by a disinterested person specially appointed by him for the purpose, who shall certify his finding to the superintendent under oath. The signers of the articles of incorporation, or the officers of the company, shall also certify, under oath, that the capital exhibited is its bona fide property. Such certificates shall be filed in the office of the superintendent. Thereupon the company shall file with the superintendent a certified copy of its articles of incorporation and the approval of the attorney general, and a copy of its bylaws and constitution.

If the superintendent finds that the company is properly organized and has complied with the law entitling it to transact business and issue policies, and unless he also finds the name assumed by it so nearly similar to that 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 license reciting that it has complied with the law and is entitled to transact the business authorized and described therein, which license shall be the authority of such company to commence business and issue policies.

So long as such insurance company complies with the law, the superintendent, annually upon its application, shall renew such license, certified copies of which may be used in evidence for or against the company in all actions.

Cite as R.C. § 3925.11

Effective Date: 10-01-1953

3925.12 Capitalization requirements.

(A)

(1) Except as otherwise provided in Title XXXIX of the Revised Code before commencing the business of insurance.

(2)

(a) Except as otherwise provided in Title XXXIX of the Revised Code before commencing the business of insurance.

(b) Each stock 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 the applicable capital and surplus set forth in section 3929.011 of the Revised Code. The cost of registration, printing, promotion, and all other expenses incident to an offer of securities shall be paid from the initial escrow account of two hundred fifty thousand dollars capitalization established prior to incorporation.

Upon receipt of evidence that the combined net deposits of both escrow accounts equal or exceed the applicable capital and surplus set forth in section 3929.011 of the Revised Code, the superintendent shall order the escrowed funds released to the company which may then commence the business of insurance.

(B)

(1) No title insurance company shall be incorporated under the laws of this state until the superintendent 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 thirty thousand dollars paid-in-capital and forty-five thousand dollars contributed surplus. Upon organization, filing of rates, 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 a final capitalization of at least one hundred twenty thousand dollars paid-in-capital and one hundred eighty thousand dollars contributed surplus before commencing the business of insurance.

(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 one hundred twenty thousand dollars paid-in-capital and one hundred eighty thousand dollars contributed surplus. The cost of registration, printing, promotion, and all other expenses incident to an offer of securities shall be paid from the initial escrow account of seventy-five thousand dollars capitalization established prior to incorporation.

Upon receipt of evidence that the combined net deposits of both escrow accounts equal or exceed one hundred twenty thousand dollars paid-in-capital and one hundred eighty thousand dollars contributed surplus, the superintendent shall order the escrowed funds released to the company which may then commence the business of insurance.

Cite as R.C. § 3925.12

Effective Date: 08-08-1991

3925.13 Annual cash premiums collectible in advance.

Mutual fire insurance companies organized under sections 3925.01 to 3925.34 , inclusive, of the Revised Code, may thereafter charge and collect in advance upon their policies a full annual premium in cash, but such policies shall not compel subscribers, insured or assured, to renew a policy or to pay a second or further annual or term premium.

Cite as R.C. § 3925.13

Effective Date: 10-01-1953

3925.14 Mutual associations excepted.

Sections 3925.12 and 3925.13 of the Revised Code are not applicable to associations which are organized as provided by law for the mutual protection of their members against loss by fire.

Cite as R.C. § 3925.14

Effective Date: 10-01-1953

3925.15 Transfers of stock.

Transfers of stock may be made on the books of an insurance company by any shareholder, or his legal representative, subject to such reasonable restrictions as the directors of such company make in its bylaws.

Cite as R.C. § 3925.15

Effective Date: 10-01-1953

3925.16 Increase of capital stock.

When, in the opinion of its directors, a company organized under sections 3925.01 to 3925.34 , inclusive, of the Revised Code, requires an increased amount of capital, if such an increase is authorized by the holders of two thirds of the stock, said directors shall file with the secretary of state a certificate setting forth the amount of the desired increase. Thereafter the company may have the increased amount of capital fixed by such certificate. The examination of securities composing the capital stock thus increased shall be made as provided by section 3925.11 of the Revised Code for capital stock originally paid in.

Cite as R.C. § 3925.16

Effective Date: 10-01-1953

3925.17 Restriction on dividends - liability of directors.

No fire insurance company organized under a law of this state shall declare or pay any dividend which impairs its capital or capital stock, nor while its capital or capital stock is impaired, nor shall any such corporation declare or pay any dividend or make any distribution of assets to any of its stockholders, whether upon a reduction of the number of its shares or of its capital or capital stock, unless the value of its assets remaining after the payment of such dividend, or after such distribution of assets, is at least equal to the aggregate amount of its debts and liabilities including capital or capital stock.

In case any such dividend is paid or any such distribution of assets made, the directors in whose administration the same is declared or made, except those who have caused their dissent therefrom to be entered upon the minutes of the directors' meetings at the time, or who were not present when such action was taken, shall be liable jointly and severally to such corporation, and to the creditors thereof, to the full amount of any loss sustained by such corporation or by its creditors by reason of such dividend or distribution.

A dividend made contrary to this section shall subject the company which makes it to a forfeiture of its charter, and each stockholder who receives such dividend to a liability to the creditors of the company to the extent of the dividend received, besides any other penalties and punishments prescribed by law.

Cite as R.C. § 3925.17

Effective Date: 10-01-1953

3925.18 Scrip dividends.

Section 3925.17 of the Revised Code does not prevent the declaration of scrip dividends by participating or mutual insurance companies, but no such dividend shall be declared to an amount in excess of profits, or be paid except from profits, after reserving all sums provided in such section, including the whole amount of premiums on unexpired risks.

As used in this section "profits" of a mutual insurance company are that portion of its cash funds not required for payment of losses and expenses nor set apart for any purpose required by law.

Cite as R.C. § 3925.18

Effective Date: 10-01-1953

3925.19 Accumulation of permanent fund.

In its bylaws any insurance company organized under sections 3925.01 to 3925.34 , inclusive, of the Revised Code, may provide for the accumulation of a permanent fund, by reserving a portion of its net profits, to be invested and be a reserve for the security of the insured. Such permanent fund in the sum determined by the board of directors shall be separate from such surplus as may be accumulated in the discretion of the company or its board of directors. The permanent fund accumulated shall be used for the payment of losses and expenses, whenever the cash funds of the company in excess of an amount equal to its liabilities are exhausted.

Cite as R.C. § 3925.19

Effective Date: 10-01-1953

3925.20 Authorized real estate holdings.

No insurance company organized under Chapter 3925. of the Revised Code, shall purchase, hold, or convey real estate, except for the following purposes and in the following manner:

(A) Real estate requisite for its convenient accommodation in the transaction of its business;

(B) Real estate mortgaged to it in good faith, by way of security for loans previously contracted, or for money due;

(C) Real estate conveyed to it in satisfaction of debts previously contracted in its legitimate business, or for money due;

(D) Real estate purchased at sales upon judgment or mortgages obtained or made for such debts;

(E) Real estate, or any interest in real estate, acquired or held by purchase, lease, or otherwise, as an investment for production of income or to be improved or developed for the production of income. An insurer shall not have at any one time more than ten per cent of its assets invested in real estate under this section. An insurer shall not have at any one time more than two per cent of its assets invested in any one real estate investment except with the prior approval of the superintendent of insurance. No investment in real estate to be used primarily for recreational, agricultural, or mining purposes shall be made under authority of this section.

Cite as R.C. § 3925.20

Effective Date: 05-13-1980

3925.21 Disposal of real estate.

Real estate acquired under division (B), (C), or (D) of section 3925.20 of the Revised Code shall be disposed of within two years after title to the real estate is acquired, unless the company determines to hold the real estate as an investment subject to the limits of individual and aggregate holdings under section 3925.20 of the Revised Code or unless the company procures a certificate from the superintendent of insurance that its interests will suffer materially by a forced sale of the real estate. The sale then may be postponed for such period as the superintendent directs in the certificate.

Cite as R.C. § 3925.21

Effective Date: 05-13-1980

3925.22 Restriction against debts.

No mutual insurance company shall borrow money or create a debt, except for necessary office buildings, which is to continue beyond the period when an assessment may be collected and applied to the payment thereof, and no member of such a company shall be assessed for liabilities incurred prior to his membership.

Cite as R.C. § 3925.22

Effective Date: 10-01-1953

3925.23 Enforcement of assessments.

If a member of a mutual insurance company neglects for thirty days after the publication of notice by the directors, and after demand for payment, to pay the sum assessed upon him as his proportion of any loss, the directors may sue for and recover the whole amount of contingent liability, with costs of the suit. Execution shall only issue for assessments and costs as they accrue, and every such execution must be accompanied by a list of losses for which the assessment is made. If the whole amount of liability is insufficient to pay the loss occasioned by any fire, the sufferers insured toward making good their respective losses shall receive a proportional share of the whole amount of such liability, according to the sums by them respectively insured. No member shall be required to pay for a loss occasioned by fire, or inland navigation, more than the whole amount of such liability.

Cite as R.C. § 3925.23

Effective Date: 10-01-1953

3925.24 Proof of assessments and notice.

In actions for the recovery of assessments levied by the directors of a mutual fire insurance company, or for money due on the liability of the members of such a company, the official statement of its president or secretary, under seal and sworn to, shall be received in court as evidence of the facts essential for making it, and as evidence that the assessment for which an action is commenced was duly levied, and notice thereof given.

Cite as R.C. § 3925.24

Effective Date: 10-01-1953

3925.25 Accident companies authorized.

Companies may be organized for any of the following special purposes:

(A) Insuring persons against accidental personal injury or loss of life while they are traveling by railroad, steamboat, or other mode of conveyance;

(B) Making every insurance connected with accidental loss of life, or with personal injury caused by accident of any description;

(C) Insuring against expenses and loss of time occasioned by sickness or other disability, on such terms and conditions, for such periods of time, and confined to such countries, localities, and persons, as may be provided for in the bylaws of the company.

Cite as R.C. § 3925.25

Effective Date: 10-01-1953

3925.26 Deposit by accident companies.

When a company organized under section 3925.25 of the Revised Code desires to do business in another state, by the laws of which, to qualify it therefor, it must make a deposit of securities assigned in trust for the benefit of its policyholders with an officer of this state, the treasurer of state shall receive such deposit and issue therefor to the company his receipt, giving a pertinent description of the securities and a certificate of their market value. The treasurer of state shall issue a like certificate to the superintendent of insurance, who shall place it on file in his office. Such company may exchange these securities for other like securities, in whole or in part, as far as its business requires, and it may wholly withdraw them if it discontinues business in such other state. Such changes or withdrawals of securities shall at once be certified by the treasurer of state to the superintendent.

Cite as R.C. § 3925.26

Effective Date: 10-01-1953

3925.27 Consolidation.

When a joint stock fire and marine insurance company determines by a vote of the holders of two thirds of its stock to consolidate and make joint stock with another like company, engaged in or incorporated for like business, and each agrees by such vote to the consolidation, the companies, by a vote of the holders of a majority of the stock so consolidated, may determine under which corporation organization or articles of association of the consolidating companies, and under what name, their future business shall be conducted.

Cite as R.C. § 3925.27

Effective Date: 10-01-1953

3925.28 Rights and duties of consolidated companies.

Upon filing with the superintendent of insurance a certificate of the consolidation authorized by section 3925.27 of the Revised Code, the companies thenceforth shall be consolidated under the corporate organization or articles of association and the corporate name chosen. All franchises, rights, equities, property, and estate, of whatever name or nature, belonging to or vested in either of the consolidating companies, immediately, by the act of such consolidation, shall become the property and estate of the consolidated company, and the corporate existence of each of the consolidating companies thenceforth ceases and is merged in the consolidation. Only such consolidated company may demand, sue for, collect, convey, and dispose of the rights, equities, property, and estate of any of the consolidating companies, or any part thereof, under its own name. All debts, liabilities, and obligations of the consolidating companies shall be assumed and paid by it.

Cite as R.C. § 3925.28

Effective Date: 10-01-1953

3925.29 Distribution of new shares of stock - limitation of capital stock.

Upon a consolidation of insurance companies authorized by section 3925.27 of the Revised Code, the true value of each outstanding share of the capital stock of each of the consolidating companies shall be ascertained by their respective directors through a suitable valuation of all the assets and liabilities thereof at the time of the consolidation, and new shares of the consolidated company shall be apportioned to each stockholder, equal to the sum ascertained to be the true value of his shares in the consolidating companies. The shares apportioned shall be substituted for each stockholder's original shares, and all certificates of shares in the consolidating companies must be surrendered when the new certificates of the apportioned shares are issued. A stockholder in either of the consolidating companies who refuses to agree to such consolidation may receive for the stock owned by him its just market value at the time thereof, which shall be paid to him previous to such consolidation.

The capital stock of such consolidated company may, by virtue of such consolidation, be equal to, but shall not exceed, the aggregate authorized capital of the consolidating companies.

Cite as R.C. § 3925.29

Effective Date: 10-01-1953

3925.30 Election of directors.

Immediately upon the consolidation of insurance companies authorized by section 3925.27 of the Revised Code, the directors of the consolidating companies shall elect from their members the directors for the consolidated company, who shall serve until their successors are elected and qualified.

Cite as R.C. § 3925.30

Effective Date: 10-01-1953

3925.31 Filing of certificate of consolidation.

Within thirty days after any consolidation of insurance companies authorized by section 3925.27 of the Revised Code, a certificate shall be filed in the office of the secretary of state, setting forth the fact of such consolidation and the name and organization adopted thereby.

Cite as R.C. § 3925.31

Effective Date: 10-01-1953

3925.32 Approval of official bonds.

An insurance company which, by its charter, is required to have its official bonds approved by a judge of the court of common pleas may at its option have such bonds approved by the probate judge of the county in which the office of the company is located.

Cite as R.C. § 3925.32

Effective Date: 10-01-1953

3925.33 Reinsurance of risks.

A fire, marine, fidelity, accident, plate-glass, boiler, or other insurance company organized or existing under the laws of this state, with the approval of the superintendent of insurance, may reinsure all risks undertaken by it in any company authorized to transact a similar class of insurance business in this state. This section does not prevent such a company from reinsuring any risks or fractional parts thereof, not situated in this state, in any company licensed by the superintendent of insurance, or like authority, of the state in which such risks are located, to transact the business of insurance in that state.

Cite as R.C. § 3925.33

Effective Date: 10-01-1953

3925.34 Authorized fields of insurance for fire insurance companies.

All companies, organized or admitted to do business for the purpose of insuring against loss or damage by fire, may insure against any of the following:

(A) Loss or damage by water caused by the breakage or leakage of sprinklers, pumps, tanks, water pipes, and fixtures connected therewith, and caused by lightning, explosion from gas, dynamite, gun powder and other like explosions, and tornadoes;

(B) Loss by the theft of automobiles and accessories and damage thereto from this cause;

(C) All direct, indirect, or consequential loss or damage to dwelling houses, stores, and all kinds of buildings and household furniture, and all other property and interest therein, including loss by fire, lightning, windstorm, tornado, cyclone, hail, tempest, flood, earthquake, frost or snow, weather or climatic conditions including excess or deficiency of moisture, rain or drought, rising of the waters of the ocean or its tributaries, bombardment, invasion, insurrection, riot, civil war or commotion, military or usurped power, explosion, fire ensuing, and explosion, no fire ensuing, except explosion by steam boiler or flywheels;

(D) Loss or damage by insects or disease to farm crops or products, and loss of rental value of land used in producing such crops or products;

(E) Loss or damage by water or other fluid to any goods or premises caused by the breakage or leakage of sprinklers, pumps or other apparatus, water pipes, or plumbing, or their fixtures, or of other conduits or containers, or by water entering through leaks or openings in buildings, and accidental injury to such sprinklers, pumps, other apparatus, water pipes, plumbing or fixtures, conduits, or containers;

(F) Loss or damage, by any of the risks of navigation and transportation, to vessels, boats, cargoes, goods, merchandise, freights, and other property and interest therein;

(G) Loss or damage to automobiles, airplanes, seaplanes, dirigibles, or other aircraft, or interest therein, whether stationary or operated under their own power;

(H) Loss or damage by any of the causes or risks specified in this section, including also transportation collision, explosion, or any peril or hazard resulting from the ownership, maintenance, or use of automobiles or motor vehicles, airplanes, seaplanes, dirigibles, or other aircraft, including burglary and theft, vandalism, malicious mischief, or the wrongful conversion, disposal, or concealment thereof and the accessories thereto, whether held under conditional sale contract or subject to chattel mortgage, and to effect reinsurance of any risk taken, but not including loss or damage by risk of bodily injury to the person.

Cite as R.C. § 3925.34

Effective Date: 10-01-1953