PARRIS N. GLENDENING, Governor                                   Ch. 11

(1)      A PERSON, OR A SUBSIDIARY OF THE PERSON, THAT IS AUTHORIZED
BY A STATE OR FOREIGN COUNTRY TO ENGAGE IN THE INSURANCE BUSINESS; OR

(2)      A PERSON, OTHER THAN A PERSON OR A SUBSIDIARY OF THE
PERSON THAT IS AUTHORIZED TO ENGAGE IN THE INSURANCE BUSINESS, TO FUND:

(I)       BENEFITS DIRECTLY OR INDIRECTLY UNDER AN EMPLOYEE
BENEFIT PLAN, AS DEFINED IN THE FEDERAL EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, THAT IS MAINTAINED IN THE UNITED STATES, OR UNDER A
SIMILAR PLAN MAINTAINED IN A FOREIGN COUNTRY;

(II)     THE ACTIVITIES OF AN ORGANIZATION EXEMPT FROM
TAXATION UNDER § 501(C) OF THE INTERNAL REVENUE CODE, OR OF A SIMILAR
ORGANIZATION IN A FOREIGN COUNTRY;

(III)    A PROGRAM, OR PLAN AS DEFINED IN § 457 OF THE INTERNAL
REVENUE CODE, OF THE FEDERAL GOVERNMENT, A STATE OR POLITICAL
SUBDIVISION OF A STATE, OR A FOREIGN COUNTRY OR POLITICAL SUBDIVISION OF
A FOREIGN COUNTRY; OR

(IV)    AN AGREEMENT THAT PROVIDES FOR PERIODIC PAYMENTS IN
SATISFACTION OF A CLAIM.

(C)     AMOUNT GUARANTEED OR CREDITED.

(1)      AN AMOUNT MAY NOT BE GUARANTEED OR CREDITED UNDER A
FUNDING AGREEMENT EXCEPT ON A REASONABLE ASSUMPTION AS TO
INVESTMENT INCOME AND EXPENSES AND ON A BASIS EQUITABLE TO ALL HOLDERS
OF FUNDING AGREEMENTS OF A GIVEN CLASS.

(2)      A FUNDING AGREEMENT MAY NOT PROVIDE FOR PAYMENT TO OR
BY THE INSURER BASED ON A MORTALITY OR MORBIDITY CONTINGENCY.

(D)     ALLOCATION OF AMOUNTS PAID; INVESTMENT.

(1)      UNDER A FUNDING AGREEMENT, AN INSURER MAY ALLOCATE
AMOUNTS PAID TO THE INSURER AND PROCEEDS APPLIED UNDER OPTIONAL
MODES OF SETTLEMENT TO THE INSURER'S GENERAL ACCOUNT OR TO ONE OR
MORE SEPARATE ACCOUNTS.

(2)      AMOUNTS ALLOCATED TO THE INSURER'S GENERAL ACCOUNT AND
ANY RESULTING ACCUMULATIONS SHALL BE INVESTED AND REINVESTED IN
ACCORDANCE WITH THE PROVISIONS OF THIS ARTICLE GOVERNING INVESTMENT
OF THE RESERVES OF LIFE INSURERS.

(3)      AMOUNTS ALLOCATED TO A SEPARATE ACCOUNT AND ANY
RESULTING ACCUMULATIONS MAY BE INVESTED AND REINVESTED SUBJECT ONLY
TO §§ 5-506, 5-507, AND 5-512(D), (G), (H), (I), (J), AND (K) OF THIS ARTICLE AND
REGULATIONS ADOPTED UNDER SUBSECTION (E) OF THIS SECTION.

(E)     REGULATIONS.

(1) THE COMMISSIONER MAY ADOPT REGULATIONS GOVERNING:

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