Purchase money mortgages on real property shall be valued in accordance with the most recent National Association of Insurance Commissioners' accounting practices and procedures manual.
(a) An insurer is insolvent if its total assets, as in this chapter provided, are less than its total liabilities, excluding as a liability, as to a stock insurer, the aggregate par value of its outstanding capital stock.
(b) An insurer is impaired if:
(i) As to a stock insurer, the sum of its assets is less than the sum of:
(A) Its liabilities;
(B) The aggregate par value of its outstanding capital stock; and
(C) The amount of surplus the insurer is required to maintain for the kinds of insurance transacted.
(ii) As to a mutual or reciprocal insurer, the sum of its assets is less than the sum of its liabilities and the amount of surplus the insurer is required to maintain for the kinds of insurance transacted.
This article shall be known as the property and casualty actuarial opinion law. W.S. 26-6-402 and 26-6-403 shall be effective beginning January 1, 2008 and shall be applicable to filings submitted after January 1, 2009.
26-6-402. Actuarial opinion of reserves and supporting documentation.
(a) Every property and casualty insurance company doing business in this state, unless otherwise exempted by the domiciliary commissioner, shall annually submit the opinion of an appointed actuary entitled "statement of actuarial opinion." This opinion shall be filed in accordance with the appropriate National Association of Insurance Commissioners property and casualty annual statement instructions.
(b) Every property and casualty insurance company domiciled in this state that is required to submit a statement of actuarial opinion shall annually submit an actuarial opinion summary, written by the company's appointed actuary. This actuarial opinion summary shall be filed in accordance with the appropriate National Association of Insurance Commissioners property and casualty annual statement instructions and shall be considered as a document supporting the actuarial opinion required in subsection (a) of this section. A company licensed but not domiciled in this state shall provide the actuarial opinion summary upon request.
(c) An actuarial report and underlying workpapers as required by the appropriate National Association of Insurance Commissioners property and casualty annual statement instructions shall be prepared to support each actuarial opinion required under this article. If the insurance company fails to provide a supporting actuarial report or workpapers at the request of the commissioner or the commissioner determines that the supporting actuarial report or workpapers provided by the insurance company is otherwise unacceptable to the commissioner, the commissioner may engage a qualified actuary at the expense of the company to review the opinion and the basis for the opinion and prepare the supporting actuarial report or workpapers.
(d) The appointed actuary shall not be liable for damages to any person, other than the insurance company and the commissioner, for any act, error, omission, decision or conduct with respect to the actuary's opinion, except in cases of fraud or willful misconduct on the part of the appointed actuary.
(a) The statement of actuarial opinion required under W.S. 26-6-402 shall be provided with the annual statement in accordance with National Association of Insurance Commissioners property and casualty annual statement instructions and shall be treated as a public document.
(b) Documents, materials or other information in the possession or control of the department that are considered an actuarial report, workpapers or actuarial opinion summary provided in support of the opinion, and any other material provided by the company to the commissioner in connection with the actuarial report, workpapers or actuarial opinion summary, shall be confidential by law and privileged, shall not be subject to inspection under W.S. 16-4-201 through 16-4-205, shall not be subject to subpoena, and shall not be subject to discovery or admissible in evidence in any private civil action. This provision shall not be construed to limit the commissioner's authority to release the documents to the actuarial board for counseling and discipline established by the American academy of actuaries so long as the material is required for the purpose of professional disciplinary proceedings and that the actuarial board for counseling and discipline establishes procedures satisfactory to the commissioner for preserving the confidentiality of the documents. Nor shall this section be construed to limit the commissioner's authority to use the documents, materials or other information in furtherance of any regulatory or legal action brought as part of the commissioner's official duties.
(c) Neither the commissioner nor any person who received documents, materials or other information while acting under the authority of the commissioner shall be permitted or required to testify in any private civil action concerning any confidential documents, materials or information subject to subsection (b) of this section.
(d) In order to assist in the performance of the commissioner's duties, the commissioner may:
(i) Share documents, materials or other information, including the confidential and privileged documents, materials or information subject to subsection (b) of this section with other state, federal and international regulatory agencies, with the National Association of Insurance Commissioners and its affiliates and subsidiaries, and with state, federal and international law enforcement authorities, provided that the recipient agrees to maintain the confidentiality and privileged status of the document, material or other information and has the legal authority to maintain confidentiality;
(ii) Receive documents, materials or information, including otherwise confidential and privileged documents, materials or information, from the National Association of Insurance Commissioners and its affiliates and subsidiaries, and from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information; and
(iii) Enter into agreements governing sharing and use of information consistent with this section.
(e) No waiver of any applicable privilege or claim of confidentiality in the documents, materials or information shall occur as a result of disclosure to the commissioner under this section or as a result of sharing as authorized in subsection
(d) of this section.
26-7-102. Definitions of terms used in chapter; determination of net earnings.
(a) As used in this chapter:
(i) "Fixed charges" means interest on funded and unfunded debt amortization of debt discount and rentals for leased properties;
(ii) "Institution" means corporations, joint-stock associations and business trusts;
(iii) "Net earnings available for fixed charges" means net income after deducting operating and maintenance expenses, taxes, other than federal and state income taxes, depreciation and depletion, but excluding extraordinary nonrecurring items of income or expense appearing in the regular financial statements of the institutions involved;
(iv) "Obligations" means bonds, debentures, notes or other evidences of indebtedness;
(v) "Domestic jurisdiction" means the United States and Canada and includes any state, province or political subdivision of the United States or Canada;
(vi) "Foreign jurisdiction" means a jurisdiction other than a domestic jurisdiction;
(vii) "Foreign investment" means an investment in a foreign jurisdiction, or an investment in a person, real estate or asset domiciled in a foreign jurisdiction. Each of the following apply to this paragraph:
(A) An investment shall not be deemed to be foreign if the issuing person, qualified primary credit source or qualified guarantor is a domestic jurisdiction or a person domiciled in a domestic jurisdiction, unless:
(I) The issuing person is a shell business entity; and
(II) The investment is not assumed, accepted, guaranteed or insured or otherwise backed by a domestic jurisdiction or a person, that is not a shell business entity, domiciled in a domestic jurisdiction.
(B) For purposes of this paragraph:
(I) "Qualified guarantor" means a guarantor against which an insurer has a direct claim for full and timely payment, evidenced by a contractual right for which an enforcement action can be brought in a domestic jurisdiction;
(II) "Qualified primary credit source" means the credit source to which an insurer looks for payment as to an investment and against which an insurer has a direct claim for full and timely payment, evidenced by a contractual right for which an enforcement action can be brought in a domestic jurisdiction;
(III) "Shell business entity" means a business entity having no economic substance except as a vehicle for owning interests in assets issued, owned or previously owned by a person domiciled in a foreign jurisdiction.
(viii) "High grade investment" means a credit instrument rated one (1) or two (2) by the securities valuation office;
(ix) "Securities valuation office" means the securities valuation office of the National Association of Insurance Commissioners, or any successor office established by the National Association of Insurance Commissioners.
(b) If net earnings are determined in reliance upon consolidated earnings statements of parent and subsidiary institutions, those net earnings shall be determined after provision for income taxes of subsidiaries and after proper allowance for minority stock interest if any. The required coverage of fixed charges shall be computed on a basis including fixed charges and preferred dividends of subsidiaries other than those payable by the subsidiaries to the parent corporation or to any other of the subsidiaries, except that if the minority common stock interest in the subsidiary corporation is substantial, the fixed charges and preferred dividends may be apportioned in accordance with regulations the commissioner prescribes.
(a) Insurers shall invest in or lend their funds on the security of and shall hold as invested assets only eligible investments prescribed in this chapter.
(b) Any particular investment held by an insurer on January 1, 1968, which was a legal investment at the time it was made, and which the insurer was legally entitled to possess immediately prior to that date, is an eligible investment.
(c) Eligibility of an investment is determined as of the date of its making or acquisition, except as stated in subsection (b) of this section.
(d) Any investment limitation based upon the amount of the insurer's assets or particular funds relates to those assets or funds as shown by the insurer's annual statement as of December 31 immediately preceding the date of the insurer's acquisition of the investment, or as shown by a current financial statement resulting from merger of another insurer, bulk reinsurance or change in capitalization.
(e) An insurer authorized to transact insurance in a foreign jurisdiction may make investments, in aggregate amount not exceeding its deposit and reserve obligations incurred in that foreign jurisdiction, in securities of or in that foreign jurisdiction possessing characteristics and of a quality similar to like investments in the United States.
(a) No security or investment, other than property acquired under W.S. 26-7-107(a)(xiii), is eligible for acquisition unless it is interest bearing or interest accruing or dividend or income paying, is not then in default and the insurer is entitled to receive for its exclusive account and benefit the interest or income accruing thereon. Any stock or digital security as defined by W.S. 34-29-101(a)(iii) which has the ability to appreciate in value shall be considered to be income paying for purposes of this subsection.
(b) No security or investment is eligible for purchase at a price above its market value.
(c) Nothing in this chapter prohibits an insurer from acquiring other or additional securities or property if received as a dividend or as a lawful distribution of assets, or under a lawful and bona fide agreement of bulk reinsurance, merger or consolidation. Any investment so acquired which is not otherwise eligible under this chapter shall be disposed of pursuant to W.S. 26-7-112 if real property, or pursuant to W.S. 26-7-113 if personal property or securities.
(a) No insurer shall make any investment or loan, other than a policy loan or an annuity contract loan of a life insurer, unless the investment or loan is authorized by the insurer's board of directors or by a committee authorized by the board and charged with the supervision or making of the investment or loan. The minutes of any such committee shall be recorded and regular reports of the committee shall be submitted to the board of directors.
(b) The insurer shall maintain a full record of each investment, showing, among other pertinent information, the name of any officer, director or principal stockholder of the insurer having any interest in the securities, loan or property constituting the investment, or in the person in whose behalf the investment is made, and the nature of the interest.
26-7-106. Diversification of and limits on investments.
(a) An insurer shall invest in or hold as admitted assets only categories of investments within applicable limits as follows:
(i) No insurer shall have at any time any combination of investments in or loans upon the security of the obligations, property or securities of any one (1) person, institution, corporation or municipal corporation aggregating an amount exceeding five percent (5%) of the insurer's admitted assets, except this does not apply to general obligations of the United States of America or of any state and shall not include policy loans made under W.S. 26-7-108 or mutual funds that are registered with the federal securities and exchange commission and are diversified within the meaning of the Investment Company Act of 1940 as from time to time amended. Investments in diversified mutual funds shall be limited to ten percent (10%) of the insurer's admitted assets per fund;
(ii) No insurer shall invest in or hold at any time more than ten percent (10%) of the outstanding voting stock of any corporation, except with respect to voting rights of preference stock during default of dividends, except this does not apply to stock of an insurer's subsidiary acquired under W.S. 26-7-107(a)(vii) or (xiv), or to controlling stock of an insurer acquired under W.S. 26-7-107(a)(vi);
(iii) An insurer, other than a title insurer, shall invest and maintain invested funds not less in amount than the minimum paid-in capital stock required under this code of a domestic stock insurer transacting like kinds of insurance, only in cash and the securities provided under W.S. 26-7-107(a)(i) and 26-7-107(a)(xii);
(iv) A life insurer shall also invest and keep invested its funds, in an amount not less than the reserves under its life insurance policies and annuity contracts in force, in cash or the securities or investments allowed under this chapter, other than in common stocks, insurance stocks and stocks of the insurer's subsidiaries;
(v) No life insurer shall invest and have invested at any time in aggregate amount more than seven percent (7%) of its assets in all stocks under W.S. 26-7-107(a)(iv), (v), (vi) and (viii), except this does not apply to stock of a controlled or subsidiary corporation under W.S. 26-7-107(a)(vi), (vii) and (xiv);
(vi) No insurer shall have invested at any time more than sixty-five percent (65%) of its assets in obligations secured by mortgage, trust deed, contract of purchase or other similar encumbrance of real property;
(vii) No insurer shall have invested at any time more than seven percent (7%) of its assets in either improvement district obligations or equipment trust certificates;
(viii) Investments in real property are limited as provided in W.S. 26-7-107(a)(xiii); and
(ix) Other specific limits apply as stated in the sections dealing with other kinds of investments.
(a) An insurer may invest in:
(i) Bonds or other evidences of indebtedness, not in default as to principal or interest, which are valid and legally authorized obligations issued, assumed or guaranteed by the United States or Canada or by any state, territory, possession or province thereof, or by any county, city, town, village, municipality or other political subdivision or public instrumentality of one (1) or more of the governmental units specified, if, by statutory or other legal requirements applicable thereto, the obligations are payable as to both principal and interest from:
(A) Taxes levied or required to be levied upon all taxable property or all taxable income within the jurisdiction of the governmental unit; or
(B) Adequate special revenues pledged or otherwise appropriated or by law required to be provided for that payment, but not including any obligation payable solely out of special assessments on properties benefited by local improvements unless adequate security is evidenced by the ratio of assessment to the value of the property or the obligation is additionally secured by an adequate guaranty fund required by law.
(ii) The obligations and stock if stated, issued, assumed or guaranteed by the following agencies of the United States government, or in which that government is a participant, whether or not it guarantees the obligations:
(A) Commodity credit corporation;
(B) Federal intermediate credit banks;
(C) Federal land banks;
(D) Banks for cooperatives;
(E) Federal home loan banks, and stock thereof;
(F) Federal national mortgage association and stock thereof when acquired in connection with sale of mortgage loans to the association;
(G) International bank for reconstruction and development;
(H) Inter-American development bank;
(J) Any other similar agency of, or participated in by, the United States government and of similar financial quality.
(iii) Obligations other than those eligible for investment under W.S. 26-7-107(a)(xii) if they are issued, assumed or guaranteed by any solvent institution created or existing under the laws of the United States or Canada or of any state, district, territory or province thereof, and are qualified under any of the following:
(A) Obligations which are secured by adequate collateral security and bear fixed interest if during each of any three (3), including the last two (2), of the five (5) fiscal years immediately preceding the date of the insurer's acquisition, the net earnings of the issuing, assuming or guaranteeing institution available for its fixed charges, as defined in W.S. 26-7-102, have been not less than one and one-fourth (1 1/4) times the total of its fixed charges for that year. In determining the adequacy of collateral security not more than one-third (1/3) of the total value of the required collateral shall consist of stock other than stock meeting the requirements of W.S. 26-7-107(a)(iv);
(B) Fixed interest-bearing obligations, other than those described in subparagraph (a)(iii)(A) of this section, if the net earnings of the issuing, assuming or guaranteeing institution available for its fixed charges for a period of five (5) fiscal years immediately preceding the date of the insurer's acquisition have averaged per year not less than one and one-half (1 1/2) times its average annual fixed charges applicable to that period and if during the last year of that period the net earnings have been not less than one and one-half (1 1/2) times its fixed charges for that year;
(C) Adjustment, income or other contingent interest obligations if the net earnings of the issuing, assuming or guaranteeing institution available for its fixed charges for a period of five (5) fiscal years immediately preceding the date of the insurer's acquisition have averaged per year not less than one and one-half (1 1/2) times the sum of its average annual fixed charges and its average annual maximum contingent interest applicable to that period and if during each of the last two (2) years of that period the net earnings have been not less than one and one-half (1 1/2) times the sum of its fixed charges and maximum contingent interest for each year.
(iv) Preferred or guaranteed stocks or shares of any solvent institution existing under the laws of the United States or of Canada, or of any state or province thereof, if all of the prior obligations and prior preferred stocks, if any, of the institution at the date of the insurer's acquisition of the investment are eligible as investments under this chapter and if the net earnings of the institution available for its fixed charges during each of the last two (2) years have been, and during each of the last five (5) years have averaged, not less than one and one-half (1 1/2) times the sum of its average annual fixed charges, if any, its average annual maximum contingent interest, if any, and its average annual preferred dividend requirements. For the purposes of this paragraph the computation shall refer to the fiscal years immediately preceding the date of the insurer's acquisition of the investment, and the term "preferred dividend requirement" means cumulative or noncumulative dividends, whether paid or not;
(v) Nonassessable common stocks, other than insurance stocks, of any solvent corporation organized and existing under the laws of the United States or Canada, or of any state or province thereof, if the corporation has had net earnings available for dividends on its stock in each of the five (5) fiscal years immediately preceding the insurer's investment therein. If the issuing corporation has not been in legal existence for the whole of the five (5) fiscal years but was formed as a consolidation or merger of two (2) or more businesses of which at least one (1) was in operation on a date five (5) years prior to the investment, the test of eligibility of its common stock under this paragraph shall be based upon consolidated pro forma statements of the predecessor or constituent institutions;
(vi) Stocks of other solvent insurers formed under the laws of this or another state, which stocks meet the applicable requirements of W.S. 26-7-107(a)(iv) and 26-7-107(a)(v). With the commissioner's advance written 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, which stocks are limited as to amount as provided in W.S. 26-7-107(a)(vii). The commissioner shall not give his consent to any such acquisition if he finds it is not in the best interests of the insurers involved or of their policyholders or stockholders, or that the acquisition would materially tend to result in any monopoly in the insurance business;
(vii) Stock of a subsidiary insurance corporation it forms. All of the insurer's investments under this paragraph, together with its investments in insurance stocks under W.S. 26-7-107(a)(vi), shall not at any time exceed the amount of the investing insurer's surplus, if a life insurer, or its surplus to policyholders if other than a life insurer;
(viii) A bank's common trust fund as defined in section 584 of the United States Internal Revenue Code of 1954;
(ix) The securities of any open-end management type investment company or investment trust registered with the federal securities and exchange commission under the Investment Company Act of 1940 as from time to time amended, if the investment company or trust has assets of not less than twenty-five million dollars ($25,000,000.00) on the date of the insurer's investment;
(x) Equipment trust obligations or certificates adequately secured and evidencing an interest in transportation equipment, wholly or in part within the United States of America, which obligations or certificates carry the right to receive determined portions of rental, purchase or other fixed obligatory payments to be made for the use or purchase of the transportation equipment;
(xi) Share accounts, savings accounts of savings and loan associations or building and loan associations or in the savings accounts of banks;
(xii) First liens upon improved real property located in this or any other state or in Canada, subject to the following conditions:
(A) For liens on single family residence property the amount loaned shall not exceed seventy-five percent (75%) of the fair value of the property, and the loan shall be amortized within not more than thirty (30) years by payment of installments thereon at regular intervals not less frequent than every three (3) months;
(B) For liens on other improved real property the amount loaned shall not exceed sixty-six and two-thirds percent (66 2/3%) of the fair value of the property;
(C) No loan shall be made or acquired by the insurer unless the fair value of the property has been determined, for the purposes of the loan, by a qualified independent appraiser;
(D) In applying the limitations provided in subparagraphs (A) and (B) of this paragraph, the amount in which the loan is guaranteed by the administrator of veteran's affairs or insured by the federal housing administration or other United States or Canadian government agency may be excluded from the amount of the loan;
(E) Insurance not less comprehensive than fire and extended coverage shall be carried on the improvements on the property in an amount not less than the insurable value of the improvements, or the amount of the loan, whichever is less, and the policy evidencing the insurance endorsed to show the interest of the mortgagee. "Improved real property" means all farm lands used for tillage, crop, other than timber, or pasture, and all real property on which permanent improvements, installations or structures suitable for residence or construction of residences, or for commercial or industrial use, are situated;
(F) Subparagraphs (A), (B) and (C) of this paragraph do not apply to purchase money mortgages taken by the insurer upon sale of property theretofore owned by it and covering the real property. No such mortgage shall be for an amount exceeding the original unpaid balance of the purchase price.
(xiii) Real property as follows:
(A) The land and the buildings thereon occupied by it as its principal office and any other real property necessary in the transaction of its business, provided the amount so invested and apportioned as to space actually so occupied shall not aggregate more than fifteen percent (15%) of the insurer's assets;
(B) Acquired in satisfaction of loans, mortgages, liens, judgments, decrees or debts previously owing to the insurer in the course of its business;
(C) Acquired in part payment of the consideration of the sale of other real property it owns, if the transaction effects a net reduction in the insurer's investments in real property;
(D) Acquired by gift or devise or through merger, consolidation or bulk reinsurance of another insurer under this code;
(E) The seller's interest in real property subject to an agreement of purchase or sale, but the sum invested in the seller's interest shall not exceed two-thirds (2/3) of the fair value of the property;
(F) Improved real property, or any interest therein acquired or held by purchase, lease or otherwise, other than real property to be used primarily for agricultural, ranch, mining, development of oil or mineral resources, recreational, amusement, hotel, motel or club purposes, acquired as an investment for the production of income or acquired to be improved or developed for such investment purposes pursuant to an existing program therefor. The insurer may hold, improve, develop, maintain, manage, lease, sell and convey real property it acquires under this provision. An insurer shall not have at any time invested in real property under this subparagraph an amount exceeding fifteen percent (15%) of its assets. An investment in any single parcel of real estate acquired under this subparagraph after March 1, 1975, shall not exceed four percent (4%) of the company's assets;
(G) Additional real property and equipment incident to real property, if necessary or convenient for the purpose of enhancing the sale or other value of real property previously acquired or held under subparagraphs (B), (C), (D) or
(F) of this paragraph. The real property and equipment shall be included, together with the real property for the enhancement of which it was acquired, for the purpose of applicable investment limits, and is subject to disposal at the same time and under the same conditions applying to the enhanced real property under W.S. 26-7-112;
(H) All real property owned by the insurer under this section, except as to seller's interest specified in subparagraph (E) of this paragraph, shall not at any time exceed thirty percent (30%) of the insurer's assets.
(xiv) Common stock, preferred stock, debt obligations, and other securities of one (1) or more subsidiary business corporations formed under the laws of this state and necessary and incidental to the insurer's insurance business or to the administration of any of its investments. The amount of the investment is governed by W.S. 26-44-102(b);
(xv) Nonassessable common stocks, other than insurance stocks, of any solvent corporation organized and existing under the laws of any foreign jurisdiction, any such investment to be subject to the limitations of W.S. 26-7-106;
(xvi) Digital assets, as defined by W.S. 34-29-101(a)(i) and excluding digital consumer assets as defined by W.S. 34-29-101(a)(ii), that otherwise comply with all applicable requirements of this chapter for the applicable asset class or for the most analogous asset class;
(xvii) Obligations issued by any solvent corporation in a foreign jurisdiction, other than an insurance company, that are traded in the United States on United States exchanges and denominated in United States dollars and subject to United States securities laws. The obligations must be high grade investments and are subject to the five percent (5%) limitation in W.S. 26-7-106(a)(i);
(xviii) Interests in a partnership or limited liability company, if the insurer has one hundred million dollars ($100,000,000.00) or more in surplus and a total adjusted capital that is at least five (5) times its authorized control level risk-based capital. An insurer's investment in any one partnership or limited liability company shall not exceed five percent (5%) of the insurer's admitted assets. The aggregate of all investments in partnerships and limited liability companies shall not exceed ten percent (10%) of the insurer's admitted assets;
(xix) Securities issued by an exchange-traded fund as defined in 17 C.F.R. 270.6c-11(a) as from time to time amended provided the following conditions are met:
(A) The exchange-traded fund is registered under the Investment Company Act of 1940 as from time to time amended;
(B) Shares of the exchange-traded fund are registered under the Securities Act of 1933 as from time to time amended;
(C) The exchange-traded fund is solvent and reported at least one hundred million dollars ($100,000,000.00) of net assets in the fund's most recent annual report or more recent audited financial statement; and
(D) Shares of the exchange-traded fund are listed and traded on a national securities exchange.
(b) At any one (1) time, the aggregate amount of foreign investments shall not exceed twenty percent (20%) of the insurer's admitted assets.
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 other contracts or obligations if the loan is adequately secured by the pledge or assignment. Loans so made are eligible investments of the insurer.
An insurer may lend and thereby invest its funds upon the pledge of securities eligible for investment under this chapter. As of the date made, no such loan shall exceed in amount ninety percent (90%) of the market value of the collateral pledged. The amount loaned shall be included pro rata in determining the maximum percentage of funds permitted under this chapter to be invested in the categories of securities so pledged.
(a) An insurer may make loans or investments not otherwise expressly permitted under this chapter, in aggregate amounts not over five percent (5%) of the insurer's admitted assets and not over one percent (1%) of those assets as to any one loan or investment, if the loan or investment fulfills the requirements of W.S. 26-7-103 and otherwise qualifies as a sound investment. An insurer with one hundred million dollars ($100,000,000.00) or more in surplus and a total adjusted capital that is at least five (5) times its authorized control level risk-based capital may make loans or investments not otherwise expressly permitted under this chapter, in aggregate amounts not over ten percent (10%) of the insurer's admitted assets and not over two percent (2%) of those assets as to any one (1) loan or investment, if the loan or investment fulfills the requirements of W.S. 26-7-103 and otherwise qualifies as a sound investment. For all insurers, no such loan or investment shall be represented by:
(i) Any item excluded under W.S. 26-6-102 or any loan or investment otherwise expressly prohibited;
(ii) Agents' balances or amounts advanced to or owing by agents, except as to policy loans, mortgage loans and collateral loans otherwise authorized under this chapter;
(iii) Any category of loans or investments expressly eligible under any other provisions of this chapter;
(iv) Any asset theretofore acquired or held by the insurer under any other category of loans or investments eligible under this chapter.
(b) An insurer may make loans to industrial development corporations under the laws of this state in an amount not exceeding the limits set forth in W.S. 17-11-106(b)(iii).
(c) The insurer shall keep a separate record of all loans and investments made under this section.
(a) In connection with a mortgage loan on the security of real property designed and used primarily for residential purposes only, which mortgage loan was acquired pursuant to W.S. 26-7-107(a)(xii), an insurer may lend or invest an amount, not exceeding twenty percent (20%) of the amount loaned on or invested in the real property mortgage, on the security of chattels, to be amortized by regular payments within a term of not more than five (5) years, and representing a first and prior lien, except for taxes not then delinquent, on personal property constituting durable equipment and owned by the mortgagor and kept and used in the mortgaged premises.
(b) For the purposes of this section, "durable equipment" includes only mechanical refrigerators, air conditioning equipment, mechanical laundering machines, heating and cooking stoves and ranges, and in the case of apartment houses, motels and hotels, room furniture and furnishings also.
(c) Prior to the acquisition of a chattel mortgage under this section, items of property to be included therein shall be separately appraised by a qualified appraiser and the fair market value thereof determined. No chattel loan shall exceed in amount the same ratio of loan to the value of the property as is applicable to the companion loan on the real property.
(d) This section does not prohibit an insurer from taking liens on personal property as additional security for any investment otherwise eligible under this chapter.
26-7-112. Security interest in chattels; time limit for disposal.
(a) Except as stated in subsection (b) of this section, the insurer shall dispose of real property acquired under W.S. 26-7-107(a)(xiii)(A) within five (5) years after it ceases to be necessary to the insurer in the transaction of its business and real property acquired under W.S. 26-7-107(a)(xiii)(B), (C) and
(D) within five (5) years after the date of acquisition.
(b) Upon satisfactory proof that the insurer's interests will suffer materially by the forced sale of real property, the commissioner, by order, may grant a reasonable extension of the period within which the insurer shall dispose of any particular parcel of real property, unless the insurer elects to hold the real property as an investment for income purposes under W.S. 26-7-107(a)(xiii)(F), in which case thereafter the real property is deemed to have been acquired at a cost equal to its book value at the time of the election and to be held under and subject to that subparagraph.
26-7-113. Disposal of ineligible investments; time limit for disposal.
Any personal property or securities lawfully acquired by an insurer which it could not otherwise have invested in or loaned its funds upon at the time of the acquisition, shall be disposed of within three (3) years from date of acquisition unless within that period the security becomes an eligible investment, except that any security or personal property acquired under any agreement of bulk reinsurance, merger or consolidation may be retained for a longer period if so provided in the plan for reinsurance, merger or consolidation as the commissioner approves under chapter 24 of this code. Upon the insurer's application and proof that forced sale of any such property or security would materially injure its interests, the commissioner may extend the disposal period for an additional reasonable time.
26-7-114. Disposal of ineligible investments; failure to
dispose; disposal of ineligible investments unlawfully acquired.
(a) Any real property, personal property or securities lawfully acquired and held by an insurer after expiration of the period for disposal thereof or any extension of that period as provided in W.S. 26-7-107(a)(vi) or 26-7-107(a)(vii), shall not be allowed as an insurer's asset.
(b) An insurer shall immediately dispose of any ineligible investment unlawfully acquired. The commissioner shall suspend or revoke the insurer's certificate of authority if the insurer fails to dispose of the investment within any reasonable time the commissioner, by order, specifies.
(a) In addition to investments excluded pursuant to other provisions of this code, an insurer shall not invest in or lend its funds upon the security of:
(i) Issued shares of its own capital stock, except for the purpose of mutualization under W.S. 26-24-143;
(ii) Securities issued by any corporation or enterprise the controlling interest of which is or after the insurer's acquisition will be held by the insurer or any combination of the insurer and the insurer's directors, officers, parent corporation, subsidiaries or controlling stockholders and the spouses and children of any of them. Investments in controlled insurance corporations or subsidiaries under W.S. 26-7-107(a)(vi), (vii) or (xiv) are not subject to this provision;
(iii) Any note or other evidence of indebtedness of any director, officer, employee or controlling stockholder of the insurer or of the spouse or child of any of them, except as to policy loans authorized under W.S. 26-7-108.
(b) No insurer shall underwrite or participate in the underwriting of an offering of securities or property by any other person.
The investment portfolio of a foreign or alien insurer shall be as permitted by the laws of its domicile if of a quality substantially equal to that required under this chapter for similar funds of like domestic insurers. In determining the relative quality and value of the investment portfolio of a foreign or alien insurer, the commissioner, for purposes of comparison, may apply the provisions of this code regulating investments of domestic insurers and valuation of those insurers. If the commissioner determines that the investment portfolio of a foreign or alien insurer is not of a quality substantially equal to that required under this chapter for similar funds of like domestic insurers, he may refuse to continue or may suspend or revoke an insurer's certificate of authority in accordance with W.S. 26-3-115.
(a) The following deposits of insurers when made through the commissioner shall be accepted and held, subject to this chapter:
(i) Deposits required under this code for authority to transact insurance in this state;
(ii) Deposits of domestic insurers if made pursuant to the laws of other states, provinces and countries as a requirement for authority to transact insurance therein;
(iii) Deposits in any additional amounts permitted under W.S. 26-8-109(b).
(a) Deposits shall be held for purposes as follows:
(i) Deposits made in this state under W.S. 26-3-111 shall be held in trust for the purposes stated in that section;
(ii) A deposit made in this state by a domestic insurer transacting insurance in another state, province or country, as required by the laws thereof, shall be held in trust for the protection of all the insurer's policyholders or all its policyholders and creditors or for any other purpose specified by those laws;
(iii) A deposit required under W.S. 26-3-130 shall be held for purposes specified by the commissioner's order pursuant to which the deposit is to be made.
(a) Any deposits required under W.S. 26-3-111 for authority to transact insurance in this state shall consist of any combination of certificates of deposit issued by solvent banks, public obligations as described in W.S. 26-7-107(a)(i) or corporate obligations described in W.S. 26-7-107(a)(iii).
(b) Any other deposits of a domestic insurer held in this state pursuant to the laws of another state, province or country shall be comprised of assets described in subsection (a) of this section and of any additional securities required or permitted by those laws, except common stocks, mortgages of any kind and real property.
(c) Deposits of foreign insurers made in this state under W.S. 26-3-130 shall consist of assets the commissioner requires pursuant to that law.
(a) Deposits made in this state under this code shall be made through and with the commissioner's approval in safe deposit with an established safe deposit institution, bank or trust company located in this state and selected by the insurer.
(b) If the deposit is kept in safe deposit, the box or compartment in which are kept the assets and securities comprising the deposit shall be placed in a fireproof safe deposit vault and shall require two (2) distinctly differing keys to open it. One (1) of the keys shall at all times be kept by the commissioner and the other key shall at all times be kept by the insurer. The box or compartment shall not at any time be opened or remain open except through the joint action and in the presence of both the commissioner and the insurer's authorized representative.
(c) The insurer shall pay the customary fees for the safekeeping of its deposit.
(a) Instead of deposit into safe deposit as provided in W.S. 26-8-104, upon the insurer's written request the commissioner may permit the insurer to make and maintain the deposit under custodial arrangements with the trust department of an established bank located in Wyoming.
(b) With the commissioner's written advance approval, the insurer may deposit certain of its securities under custodial arrangements with an established bank or trust company located outside this state, if the custodial bank or trust company issues original receipts for those securities and they are held in safe deposit or custody subject to the requirements of W.S. 26-8-104(b) or subsection (a) of this section.
(c) The form and terms of all such custodial arrangements shall be as the commissioner prescribes or approves consistent with the applicable provisions of this code [title 26].
(d) The insurer shall bear the costs of custodial arrangements.
26-8-106. Commissioner's record of deposits; vouchers as to assets deposited.
(a) The commissioner shall:
(i) Give the depositing insurer vouchers as to assets deposited with him;
(ii) Keep a record of the assets comprising each insurer's deposit, showing as far as practical the amount and market value of each item and each of his transactions relative thereto.
26-8-107. Assignment or transfer of securities deposited to commissioner.
Any assets deposited by an insurer and not negotiable by delivery shall be assigned or transferred to the commissioner and his successors in office. Upon release of any such security or asset to the insurer, the commissioner shall reassign or transfer the security or asset to the insurer.
Prior to acceptance for deposit of any asset, or at any time thereafter while so deposited, the commissioner may have the asset appraised or valued by competent appraisers. The insurer shall bear the reasonable costs of the appraisal or valuation.
(a) If assets deposited by an insurer under this chapter are subject to material fluctuations in market value, the commissioner may require the insurer to deposit and maintain on deposit additional assets in an amount reasonably necessary to assure that the deposit at all times has a market value of not less than the amount specified under the law by which the deposit is required.
(b) An insurer not required to make additional deposits may deposit assets in an amount exceeding its deposit required or otherwise permitted under this code by not more than twenty percent (20%) of the required or permitted deposit, or twenty thousand dollars ($20,000.00), whichever is larger, for the purpose of absorbing fluctuations in the value of assets deposited and to facilitate exchange and substitution of those assets. During the insurer's solvency any excess deposit shall be released to the insurer upon its request. During the insurer's insolvency, an excess deposit shall be released only as provided in W.S. 26-8-113(d).
(a) If the insurer is solvent and in compliance with this code it may:
(i) Demand, receive, sue for and recover the income from the assets deposited;
(ii) Exchange and substitute for the deposited assets, or any part thereof, other eligible securities and assets of equivalent or greater market value; and
(iii) At any reasonable time inspect its deposit.
No judgment creditor or other claimant of an insurer has the right to levy upon any of the assets held in this state as a deposit for the protection of the insurer's policyholders or creditors or both. As to a deposit made pursuant to W.S. 26-3-111, levy on that deposit is permitted if provided in the commissioner's order under which the deposit is required.
If for any reason the market value of an insurer's assets held on deposit in this state as required under this code falls below the required amount, the insurer shall promptly deposit other or additional assets eligible for deposit sufficient to cure the deficiency. If the insurer fails to cure the deficiency within twenty (20) days after receipt of notice thereof by registered or certified mail from the commissioner, the commissioner shall revoke the insurer's certificate of authority.
(a) Any deposit an insurer makes in this state pursuant to this code, including assets held in another state under custodial arrangements permitted by W.S. 26-8-105(b), shall be held as long as:
(i) There is outstanding any liability of the insurer as to which the deposit was so required; or
(ii) The basis of retaliation exists if the deposit was required under W.S. 26-3-130.
(b) Upon a domestic insurer's request, the commissioner shall return to the insurer the whole or any portion of its assets held on deposit if the commissioner is satisfied that the assets to be returned are not subject to liability and are not required to be longer held by any provision of law or purposes of the original deposit. If the insurer has reinsured all its outstanding risks in another insurer authorized to transact insurance in this state, the commissioner shall deliver the assets and securities to the insurer assuming the risks, upon the domestic insurer's written notice that the assets have been assigned and transferred to the reinsuring insurer. The notice shall be accompanied by a verified copy of the assignment or transfer.
(c) The commissioner shall return any deposit made in this state by a foreign insurer, if that insurer ceases transacting insurance in this state and is not subject to any liability in this state for which the deposit was held.
(d) If the insurer is subject to delinquency proceedings as defined in W.S. 26-28-101, upon the order of a court of competent jurisdiction the commissioner shall yield the insurer's assets held on deposit to the insurer's receiver, conservator, rehabilitator or liquidator, or to any other properly designated official who succeeds to the management and control of the insurer's assets.
(e) No release of deposited assets shall be made except upon application to and the written order of the commissioner. The commissioner has no personal liability for any release of any deposit or part thereof he makes in good faith.
If the commissioner willfully fails to require, deposit, keep, account and receipt for, or surrender in the manner by law authorized or required any assets as provided in this code, he is responsible upon his official bond therefor and suit may be brought upon his bond by any person injured by the failure.
(a) As used in this article:
(i) "Clearing corporation" means a corporation as defined in W.S. 34.1-8-102(a)(v), except that with respect to securities issued by institutions organized or existing under the laws of any foreign country or securities used to meet the deposit requirements pursuant to the laws of a foreign country as a condition of doing business therein, clearing corporation may include a corporation which is organized or existing under the laws of any foreign country and is legally qualified under those laws to effect transactions in securities by computerized book-entry. Clearing corporation also includes the "treasury/reserve automated debt entry securities system" and the "treasury direct" book-entry securities systems established pursuant to 31 U.S.C. § 3100, et seq., 12 U.S.C. part 391 and 5 U.S.C. part 301;
(ii) Repealed By Laws 2007, Ch. 44, § 3.
(iii) Repealed By Laws 2007, Ch. 44, § 3.
(iv) Repealed By Laws 2007, Ch. 44, § 3.
(v) "Security" means as defined in W.S. 34.1-8-102(a)(xv);
(vi) "Custodian" means a national bank, state bank or a trust company which participates in a clearing corporation.
(a) Notwithstanding any other provision of law, but subject to W.S. 26-24-129, a domestic insurer may deposit or arrange for the deposit of securities held in or purchased for its general account and its separate accounts in a clearing corporation. When securities are deposited with a clearing corporation, certificates representing securities of the same class of the same issuer may be merged and held in bulk in the name of the nominee of the clearing corporation with any other securities deposited with the clearing corporation by any person, regardless of the ownership of the securities, and certificates representing securities of small denominations may be merged into one (1) or more certificates of larger denominations. The records of any custodian through which an insurer holds securities in a clearing corporation, shall at all times show that the securities are held for the insurer and the accounts in which they are held. Ownership of, and other interests in, the securities may be transferred by bookkeeping entry on the books of the clearing corporation without physical delivery of certificates representing the securities.
(b) The commissioner is authorized to promulgate rules and regulations governing the deposit by insurers of securities with clearing corporations, including establishing standards for national banks, state banks and trust companies to qualify as custodians for insurance company securities.
Notwithstanding any other provision of law, the securities qualified for deposit under this chapter may be deposited with a clearing corporation. Securities deposited with a clearing corporation and used to meet the deposit requirements set forth in chapter 3 of this code shall be under the control of the commissioner and shall not be withdrawn by the insurer without the approval of the commissioner. Any insurer holding securities in this manner shall provide to the commissioner evidence issued by its custodian through which the insurer has deposited the securities in a clearing corporation in order to establish that the securities are actually recorded in an account in the name of the custodian and that the records of the custodian reflect that the securities are held subject to the order of the commissioner.
26-8-204. Deposit of securities by foreign insurers.
Notwithstanding any other provision of law, securities eligible for deposit under the insurance laws of this state relating to deposit of securities by an insurer as a condition of commencing or continuing to do an insurance business in this state may be deposited with a clearing corporation. Securities deposited with a clearing corporation and used to meet the deposit requirements under the insurance laws of this state shall be under the control of the commissioner and shall not be withdrawn by the insurer without the approval of the commissioner. Any insurer holding securities in this manner shall provide to the commissioner evidence issued by its custodian in order to establish that the securities are actually recorded in an account in the name of the custodian and evidence that the records of the custodian reflect that the securities are held subject to the order of the commissioner.