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PARRIS N. GLENDENING, Governor
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Ch. 660
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(i) (1) The reserve investments of a life insurer may include collateral loans
secured by pledge of any security listed in subsections (c) through (h) of this section if
the current market value of the pledged security at all times during the term of the
loan is at least 10% more than the unpaid balance of the loan amount.
(2) Each collateral loan is subject to the power of the life insurer to
terminate it if the pledged security depreciates below 10% of the unpaid balance of
the loan amount.
(j) (1) For purposes of this subsection, real estate sold under a contract of
sale in which title is retained in the life insurer shall be classified as real estate.
(2) Subject to paragraph (3) of this subsection, the reserve investments
of a life insurer may include:
(i) real estate for the office and business purposes only of the life
insurer, except as authorized by subsections (g) and (h) of this section; or
(ii) property primarily for the use of employees or customers of the
life insurer for parking with or without charge.
(3) The equity value of all real estate held under paragraph (2) of this
subsection may not exceed 20% of the life insurer's total admitted assets.
(4) A life insurer may purchase and hold real estate under a foreclosure
of its own mortgages or a deed in lieu of mortgage foreclosure for not more than 5
years.
(5) Subject to paragraph (6) of this subsection, the Commissioner may
grant extensions for periods not exceeding 5 years each of the period within which
real estate may be held under paragraph (4) of this subsection, if the Commissioner
considers the extensions necessary to serve the best interest of the life insurer and its
policyholders.
(6) Before the Commissioner may refuse to grant extensions under
paragraph (5) of this subsection, an appraisal of the real estate shall be obtained. If
the appraisal shows that the appraised value of the real estate equals or exceeds the
book value of the real estate, the Commissioner shall grant extensions for periods not
exceeding 5 years each.
(7) With the written approval of the Commissioner, a life insurer may
acquire property as partial payment of the consideration for the sale of real estate
owned by the life insurer if the transaction causes a net reduction in the investment
of the life insurer in real estate.
(8) With the approval of the Commissioner, a life insurer may acquire
other real estate if necessary or convenient to enhance the market value of real estate
previously acquired or held by the life insurer in accordance with this subsection.
(k) The reserve investments of a life insurer may include interest, rents, or
other fixed income due and accrued on:
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- 3377 -
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