S.D. Admin. R. 20:06:19:07

Current through Register Vol. 50, page 159, June 17, 2024

Section 20:06:19:07 - Valuation

Exchange-traded call or put options shall be valued as follows:

(1) Exchange-traded call or put stock or stock index options purchased by an insurance company shall be valued at the current market price on a registered national securities exchange. This "adjusting to market" will result in an unrealized gain or loss;

(2) Stock owned by an insurance company on which it has sold a call option shall be valued at the current market price during the period the option exists;

(3) The amount held in a deferred account for call or put stock options sold or written shall be valued at the current market price. The adjustment will result in an unrealized gain or loss;

(4) Every call or put option on an underlying debt instrument purchased by an insurance company shall be valued at cost provided that, at the time of purchase, the insurance company anticipates its disposal or acquisition in the ordinary course of business of an asset or group of assets identified and associated with the option in the company records. Debt options purchased or recorded as set forth in this subdivision shall be valued at the current market price as provided in subdivision (1) of this section;

(5) Debt instruments owned by an insurance company on which it has sold or written a call option shall be valued in the same manner as other instruments owned by the insurer;

(6) The amount held in a deferred account for call or put debt options sold or written shall be valued at the current market price. The adjustment will result in an unrealized gain or loss.

S.D. Admin. R. 20:06:19:07

13 SDR 75, effective 12/21/1986.

General Authority: SDCL 58-4-1, 58-27-7.

Law Implemented: SDCL 58-27-7.