N.M. Admin. Code § 13.9.3.10

Current through Register Vol. 35, No. 24, December 23, 2024

Section 13.9.3.10 - INVESTMENTS

A. Except as may be provided with respect to reserves for guaranteed benefits and funds referred to in 13 NMAC 9.3.10.2 [now Subsection B of 13.9.3.10 NMAC]:

(1) amounts allocated to a separate account and its accumulations may be invested and reinvested without regard to any requirements or limitations prescribed by the laws of this state governing the investments of life insurance companies; and

(2) the investments in the separate account or accounts shall not be taken into account in applying the investment limitations otherwise applicable to the investments of the company.

B. Reserves for benefits guaranteed as to dollar amount and duration and funds guaranteed as to principal amount or stated rate of interest may be maintained in a separate account if a portion of the assets of the separate account at least equal to the reserve liability is invested in accordance with the laws and rules of this state governing the investments of life insurance companies. That portion of the assets also shall not be taken into account in applying the investment limitations otherwise applicable to the investments of the company.

C. With respect to seventy-five percent (75%) of the market value of the total assets in a separate account a company shall not purchase or otherwise acquire the securities of an issuer, other than securities issued or guaranteed as to principal or interest by the United States, if immediately after the purchase or acquisition the market value of the investment, together with prior investments of the separate account in the security taken at market, would exceed ten percent (10%) of the market value of the assets of the separate account. The superintendent, may waive this limitation if, in the opinion of the superintendent, the waiver will not render the operation of the separate account hazardous to the public or policyholders in this state.

D. Unless otherwise permitted by law or approved by the superintendent, a company shall not purchase or otherwise acquire for its separate accounts the voting securities of an issuer if, as a result of the acquisition, the insurance company and its separate accounts, in the aggregate, will own more than ten percent (10%) of the total issued and outstanding voting securities of the issuer. This shall not apply with respect to securities held in separate accounts where the voting rights are exercisable only in accordance with instructions from persons having interest in the accounts.

E. The limitations provided in 13 NMAC 9.3.10.3 and 9.3.10.4 [now Subsections C and D of 13.9.3.10 NMAC] of this subsection shall not apply to investments with respect to a separate account in the securities of an investment company registered under the Investment Company Act of 1940, if the investments of the investment company comply in substance with 13 NMAC 9.3.10.3 and 9.3.10.4 [now Subsections C and D of 13.9.3.10 NMAC].

N.M. Admin. Code § 13.9.3.10

7/1/97; Recompiled 11/30/01