H.B. 551

VETOES

accomplishes the same purpose. Therefore, it is not necessary for me to sign House
Bill 551.

Sincerely,

Robert L. Ehrlich, Jr.

Governor

House Bill No. 551

AN ACT concerning

Life Insurance - Separate Investment Accounts - Asset Holding

Requirements

FOR the purpose of requiring certain life insurers that offer certain investment
accounts to hold assets that equal or exceed certain reserve requirements;
requiring that assets held for certain investment accounts be valued in
accordance with certain provisions of law; and generally relating to asset
holding requirements for separate investment accounts that provide a fixed
guaranteed return that is not subject to market value adjustment.

BY repealing and reenacting, with amendments,
Article - Insurance
Section 5-512(k)
Annotated Code of Maryland
(1997 Volume and 2002 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article - Insurance

5-512.

(k) (1) Investments made with respect to separate investment accounts
shall be valued for the purpose of any valuation required by this article:

[(1)] (I) at the market value of the investment on the date of the
valuation; or

[(2)] (II) if there is no readily available market, in accordance with the
terms of the written agreement referred to in subsection (c) of this section.

(2) (I) IF A SEPARATE INVESTMENT ACCOUNT PROVIDES A FIXED
GUARANTEED RETURN THAT IS NOT SUBJECT TO MARKET VALUE ADJUSTMENT, THE
LIFE INSURER SHALL HOLD ASSETS THAT EQUAL OR EXCEED THE RESERVE AMOUNT
THAT WOULD BE REQUIRED IF THE SEPARATE INVESTMENT ACCOUNT WAS AN
OBLIGATION OF THE LIFE INSURER'S GENERAL ACCOUNT.

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