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23-63-833. Prohibited investments.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-63-833. Prohibited investments.
In addition to investments excluded pursuant to other provisions of the Arkansas Insurance Code, an insurer shall not directly or indirectly invest in or lend its funds upon the security of:
(1) Issued shares of its own capital stock, except for the purpose of mutualization under § 23-69-140 or with the advance consent of the Insurance Commissioner under § 23-63-817;
(2) Except with the advance consent of the commissioner, securities issued by any corporation or enterprise the controlling interest of which is held, or will be held after the acquisition by the insurer, directly or indirectly by the insurer or any combination of the insurer and the insurer's directors, officers, parent corporation, subsidiaries, or controlling stockholders. Investments in subsidiaries under § 23-63-818 shall not be subject to this provision; or
(3) Any note or other evidence of indebtedness of any director, officer, employee, or controlling stockholder of the insurer, except as to policy loans authorized under § 23-63-821.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-63-833
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:23-63-833
Source file: gov.ar.code.title.23.odt
Pages: Not recorded – Not recorded
Passage SHA-256: 51f564d16a6fe1416363419ba7bb3d07d230df27513c354962b3ffcd88686148
Source location: content.xml paragraph 32681
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23-63-833. Prohibited investments.
In addition to investments excluded pursuant to other provisions of the Arkansas Insurance Code, an insurer shall not directly or indirectly invest in or lend its funds upon the security of:
(1) Issued shares of its own capital stock, except for the purpose of mutualization under § 23-69-140 or with the advance consent of the Insurance Commissioner under § 23-63-817;
(2) Except with the advance consent of the commissioner, securities issued by any corporation or enterprise the controlling interest of which is held, or will be held after the acquisition by the insurer, directly or indirectly by the insurer or any combination of the insurer and the insurer's directors, officers, parent corporation, subsidiaries, or controlling stockholders. Investments in subsidiaries under § 23-63-818 shall not be subject to this provision; or
(3) Any note or other evidence of indebtedness of any director, officer, employee, or controlling stockholder of the insurer, except as to policy loans authorized under § 23-63-821.
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Arkansas Code — all titles (historical 2020) · legal_authorities
23-63-817. Insurance stocks.
(a) An insurer may invest in the stocks of other solvent insurers formed under the laws of this or another state if the stocks meet the applicable requirements of § 23-63-815 as to preferred or guaranteed stock or § 23-63-816 as to common stock, and, with the advance consent of the Insurance Commissioner, an insurer may invest in issued shares of its own capital stock, provided that these investments shall only be made from the insurer's earned surplus. Investments by an insurer in its own capital stock in accordance with the provisions of this section may be made by pro rata purchase from the insurer's shareholders or on a non-pro rata basis, at the election of the insurer.
(b) With the commissioner's consent, an insurer may acquire and hold the controlling interest in the outstanding voting stock of another stock insurer formed under the laws of this or another state. All stocks under this subsection shall be subject to the limitation as to amount as provided in § 23-63-818.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-63-817
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-63-817. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-63-818. Stocks of subsidiaries.
(a) With the Insurance Commissioner's written approval, a domestic insurer may invest in the stock of its wholly owned subsidiary insurance corporation or in the stock of its wholly owned subsidiary business corporation formed or acquired for and necessary and incidental to:
(1) The convenient operation of the domestic insurer's insurance business; or
(2) The administration of any of the domestic insurer's lawful investments.
(b) Unless a greater investment has been approved in writing by the commissioner:
(1) All of the domestic insurer's investments under this section together with its investments in insurance stocks under § 23-63-817(b) shall not at any time exceed:
(A) The domestic insurer's surplus if a life insurer; or
(B) The domestic insurer's policyholders' surplus if other than a life insurer; and
(2)(A) A domestic insurer subject to this subchapter shall limit its investments in common stock, preferred stock, debt obligations, and other securities of its noninsurance subsidiaries to the lesser of:
(i) Ten percent (10%) of the domestic insurer's assets; or
(ii) Fifty percent (50%) of the domestic insurer's surplus.
(B) This subdivision (b)(2) does not apply to the amount of an investment held on July 31, 2007, by a domestic insurer licensed in Arkansas.
(c) With the prior written approval of the commissioner, a domestic insurer may invest any amount in the securities of one (1) or more of the domestic insurer's subsidiaries if after the investment the domestic insurer's policyholders' surplus is:
(1) Reasonable in relation to the domestic insurer's outstanding liabilities; and
(2) Adequate for the domestic insurer's financial needs.
(d) An investment that exceeds the scope of an approval granted
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-63-818
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-63-818. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-63-821. Policy loans.
(a) A life insurer may lend to its policyholder upon pledge of the policy as collateral security any sum not exceeding the cash surrender value of the policy or may lend against pledge or assignment of any of its supplementary contracts or its other contracts or obligations, so long as the loan is adequately secured by the pledge or assignment.
(b) Loans so made are eligible investments of the insurer.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-63-821
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-63-821. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-69-140. Mutualization of stock insurers.
(a) A stock insurer other than a title insurer may become a mutual insurer under such plan and procedure as may be approved by the Insurance Commissioner after a hearing thereon.
(b) The commissioner shall not approve any plan, procedure, or mutualization unless:
(1) It is equitable to stockholders and policyholders;
(2) It is subject to approval by the holders of not less than three-fourths (¾) of the insurer's outstanding capital stock having voting rights and by not less than two-thirds (2/3) of the insurer's policyholders who vote on the plan in person, by proxy, or by mail pursuant to such notice and procedure as may be approved by the commissioner;
(3) If a life insurer, the right to vote thereon is limited to holders of policies other than term or group policies and whose policies have been in force for more than one (1) year;
(4) Mutualization will result in retirement of shares of the insurer's capital stock at a price not in excess of the fair market value thereof as determined by competent disinterested appraisers;
(5) The plan provides for the purchase of the shares of any nonconsenting stockholder in the same manner and subject to the same applicable conditions as provided by § 23-69-148 as to rights of nonconsenting stockholders, with respect to consolidation or merger of insurance corporations;
(6) The plan provides for definite conditions to be fulfilled by a designated early date upon which the mutualization will be deemed effective; and
(7) The mutualization leaves the insurer with surplus funds reasonably adequate for the security of its policyholders and to enable it to continue successfully in business in the states in which it is then authorized to transact insurance and for the kinds of
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-69-140
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-69-140. This identifies an authority to review, not proof of applicability.