1998 Minnesota Statutes

     60L.08 Limitations generally applicable. 

    Subdivision 1.    Class limitations.  For the purposes 
 of section 60L.11, the following limitations on classes of 
 investments apply: 

    (a) For investments authorized under section 60L.07, clause 
 (2), and investments authorized under section 60L.07, clause 
 (7), that are of the types described in section 60L.07, clause 
 (2), the following restrictions apply: 

    (1) the aggregate amount of medium and lower grade 
 investments may not exceed 20 percent of the insurer's admitted 
 assets; 

    (2) the aggregate amount of lower grade investments may not 
 exceed ten percent of the insurer's admitted assets; 

    (3) the aggregate amount of investments rated 5 or 6 by the 
 SVO may not exceed five percent of the insurer's admitted 
 assets; 

    (4) the aggregate amount of investments rated 6 by the SVO 
 may not exceed one percent of the insurer's admitted assets; or 

    (5) the aggregate amount of medium and lower grade 
 investments that receive as cash income less than the equivalent 
 yield for United States Treasury issues with a comparative 
 average life, may not exceed one percent of the insurer's 
 admitted assets. 

    (b) Investments authorized under section 60L.07, clause 
 (3), may not exceed 45 percent of admitted assets in the case of 
 life insurers and 25 percent of admitted assets in the case of 
 insurers other than life insurers. 

    (c) Investments authorized under section 60L.07, clause 
 (4), other than subsidiaries of the types authorized under 
 section 60A.11, subdivision 18, paragraph (a), clause (4); 
 60D.16; or 61A.281, may not exceed 20 percent of admitted assets 
 in the case of life insurers and 25 percent of admitted assets 
 in the case of insurers other than life insurers. 

    (d) Investments authorized under section 60L.07, clause 
 (5), may not exceed ten percent of admitted assets. 

    (e) Investments authorized under section 60L.07, clause 
 (6), may not exceed 20 percent of admitted assets in the case of 
 life insurers, and ten percent of admitted assets in the case of 
 insurers other than life insurers. 

    (f) Investments authorized under section 60L.07, clause 
 (7), may not exceed 20 percent of admitted assets. 

    (g) Investments authorized under section 60L.07, clause 
 (8), may not exceed two percent of admitted assets. 

    (h) Investments authorized under section 60L.07, clause 
 (9), may not exceed two percent of admitted assets. 

    Subd. 2.    Individual limitations.  For purposes of 
 determining compliance with section 60L.11, securities of a 
 single issuer and its affiliates, other than the government of 
 the United States and subsidiaries authorized under section 
 60A.11, subdivision 18, paragraph (a), clause (4); 60D.16; or 
 61A.281, may not exceed three percent of admitted assets in the 
 case of life insurers, and five percent in the case of insurers 
 other than life insurers.  For purposes of this subdivision, in 
 the case of asset-backed securities issued, assumed, insured, or 
 guaranteed by a government-sponsored enterprise and secured by 
 or evidencing an interest in a single asset or single pool of 
 assets held by a trust or other business entity, the issuer is 
 considered to be the asset or pool of assets. 

    Subd. 3.    Investment subsidiaries.  For purposes of 
 determining compliance with this section, the admitted portion 
 of assets of subsidiaries under section 60A.11, subdivision 18, 
 paragraph (a) clause (4); 60D.16, subdivision 2, paragraph (b); 
 or 61A.281, subdivision 5, are considered to be owned directly 
 by the insurer and any other investors in proportion to the 
 market value, or if there is no market, the reasonable value, of 
 their interest in the subsidiaries. 

    Subd. 4.    Effect of quantity limitations.  To the 
 extent that investments exceed the limitations specified under 
 subdivisions 1 and 2, the excess may be assigned to the 
 investment class authorized in section 60L.07, clause (12), 
 until that limit is exhausted. 

    Subd. 5.    Mutual funds, pooled investment vehicles, and 
 other investment companies.  If the commissioner considers it 
 desirable in order to get a proper evaluation of the investment 
 portfolio of an insurer, the commissioner may require that 
 investments in mutual funds, pooled investment vehicles, or 
 other investment companies be treated for purposes of sections 
 60L.01 to 60L.15, as if the investor owned directly its 
 proportional share of the assets owned by the mutual fund, 
 pooled investment vehicle, or investment company. 

    Subd. 6.    Investment limitation computation.  Unless 
 otherwise specified, an investment limitation computed on the 
 basis of an insurer's admitted assets or capital and surplus 
 must relate to the amount required to be shown on the statutory 
 balance sheet of the insurer most recently required to be filed 
 with the commissioner. 

    HIST: 1998 c 319 s 8