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1998 SESSION

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HB 565 Insurance; insurer investment limits.

Introduced by: Clifton A. Woodrum | all patrons    ...    notes | add to my profiles

SUMMARY:

Insurance; insurer investment limits. Modifies the investment restrictions imposed on insurance companies domesticated in Virginia. For purposes of distinguishing between Category 1 and Category 2 investments, this measure would increase the caps on foreign investments, investments graded Category 4 by the Securities Valuation Office (the "SVO") of the National Association of Insurance Commissioners (securities are rated from 2 [high grade] to 6 [lower grade]), investments in local government obligations, and investments in any one agency of the U.S. government.

The bill (i) treats as Category 1 investments, investments of up to nine percent of admitted assets in foreign securities rated high grade and of up to one percent in such securities rated medium grade, (ii) increases the cap on investments in any one U.S. political subdivision from two to five percent, (iii) increases the aggregate cap on investments in federal, state and local government obligations from 20 percent to 30 percent, and (iv) authorizes investment of up to two percent of admitted assets in securities rated 4 by the SVO. In addition, the bill provides that Category 2 assets can be treated as admitted assets to the extent that they do not exceed 75 percent of surplus in excess of minimum capital and surplus.


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