HARRY HUGHES, Governor

877

percent of assets, invest any amount in common stock of one or
more subsidiaries, provided that after such investment the
insurer's assets and surplus as regards policyholders,
considering such investment as if it were a disallowed asset,
will be reasonable in relation to the insurer's outstanding
liabilities and adequate to its financial needs;

(3)  (I) Invest any amount in common stock, PREFERRED
STOCK, DEBT OBLIGATIONS, AND OTHER SECURITIES OF ONE OR MORE
SUBSIDIARIES ENGAGED OR ORGANIZED TO ENGAGE EXCLUSIVELY IN THE
OWNERSHIP AND MANAGEMENT OF ASSETS AUTHORIZED AS INVESTMENTS FOR
THE INSURER of OR [a subsidiary] ONE OR MORE INSURANCE
SUBSIDIARIES provided that EACH such subsidiary limits ITS
investments [in the common stock of any one corporation or] in
any [other] asset so that [the amount of any one investment when
multiplied by the percentage of the insurer's ownership in said
subsidiary, plus the insurer's direct investment in such asset
does not] THE INVESTMENT WILL NOT CAUSE THE AMOUNT OF THE TOTAL
INVESTMENT OF THE INSURER TO exceed any of the investment
limitations [specified in] APPLICABLE TO THE INSURER UNDER
paragraph (1) of this subsection or [in] UNDER §§ 86 through 107
of this article [applicable to the insurer; and].

(II) FOR THE PURPOSE OF THIS PARAGRAPH, THE
"TOTAL INVESTMENT OF THE INSURER" SHALL INCLUDE:

1.  ANY DIRECT INVESTMENT BY THE INSURER
IN AN ASSET OTHER THAN SECURITIES OF ITS SUBSIDIARIES; AND

2.  THE INSURER'S PROPORTIONATE SHARE OF
ANY INVESTMENT IN AN ASSET BY ANY SUBSIDIARY OF THE INSURER,
WHICH SHALL BE CALCULATED BY MULTIPLYING THE AMOUNT OF THE
SUBSIDIARY'S INVESTMENT BY THE PERCENTAGE OF THE INSURER'S
OWNERSHIP OF THE SUBSIDIARY;

(4)  With the approval of the Commissioner, invest any
GREATER amount in common stock, PREFERRED STOCK, DEBT
OBLIGATIONS, OR OTHER SECURITIES of one or more subsidiaries,
provided that after such investment the insurer's surplus as
regards policyholders, considering such investment as if it were
a disallowed asset, will be reasonable in relation to the
insurer's outstanding liabilities and adequate to its financial
needs.

[(5) Invest in preferred stock and debt obligations
of one or more affiliates in an amount which together with the
actual cost at the time of acquisition or formation or other such
investments under this paragraph does not exceed the lesser of
five (5) percent of such insurer's assets or forty (40) percent
of such insurer's surplus as regards policyholders, provided that
after such investment the insurer's surplus as regards
policyholders will be reasonable in relation to the insurer's
outstanding liabilities and adequate to its financial needs. For
purposes of this clause, "actual cost" shall mean total net
moneys or other consideration expended and obligations assumed in