Bill Text: NJ S3409 | 2022-2023 | Regular Session | Introduced
Bill Title: Updates certain insurance company investment provisions in accordance with Investments of Insurers Model Act.
Spectrum: Bipartisan Bill
Status: (Passed) 2024-01-08 - Approved P.L.2023, c.219. [S3409 Detail]
Download: New_Jersey-2022-S3409-Introduced.html
Sponsored by:
Senator NELLIE POU
District 35 (Bergen and Passaic)
Senator STEVEN V. OROHO
District 24 (Morris, Sussex and Warren)
SYNOPSIS
Permits certain insurance companies to make certain foreign investments.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning foreign investments by certain insurance companies and amending R.S.17:24-10,
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.17:24-10 is amended to read as follows:
17:24-10. a. Any insurance company of this State lawfully doing business in any foreign country may also invest its funds, to an amount not exceeding the value of its outstanding policies of insurance issued or delivered in the foreign country, in securities issued by any governing body or agency or any corporation of the foreign country or in obligations secured upon property therein, otherwise of the same character as that prescribed for authorized investments for the funds of the company under the laws of this State; provided, that any loan secured by first mortgage on unencumbered real estate in the Dominion of Canada, authorized and placed under any act of that Dominion by virtue of which it assumes liability for all or a substantial portion of any loss resulting from the liquidation of such investment after the foreclosure of the mortgage securing the same, or by virtue of which it guarantees the payment of such loan, shall be construed as being of such character. Any investment hereby authorized shall be subject to all other limitations imposed by the laws of this State.
b. Any insurance company of this State may invest in foreign obligations and investments:
(1) up to 10 percent of admitted assets in any foreign country or jurisdiction rated in one of the two highest rating categories by an independent, nationally recognized United States rating agency; and
(2) up to two percent of admitted assets in any other foreign country and up to 15 percent of admitted assets in the aggregate in all such other foreign countries. The aggregate foreign obligations and investments shall not exceed 30 percent of admitted assets. All such foreign obligations and investments made within the limitations of this subsection shall also be subject to the percentage limitations in R.S.17:24-1 set seq., as applicable to the investment class, but this subsection shall not apply to investments that otherwise constitute an ownership interest in a subsidiary or affiliate of the insurance company.
(cf: P.L.1945, c.23, p.80, s.1)
2. This act shall take effect immediately.
STATEMENT
This bill amends current law
concerning the foreign investments
that an insurance company is permitted to make. Under the bill, an insurance
company may invest in foreign obligations and investments:
(1) up to 10 percent of admitted assets in any foreign country or jurisdiction rated in one of the two highest rating categories by an independent, nationally recognized United States rating agency; and
(2) up to two percent of admitted assets in any other foreign country and up to 15 percent of admitted assets in the aggregate in all such other foreign countries. The aggregate foreign obligations and investments are not to exceed 30 percent of admitted assets.
The bill updates the provision governing property/casualty insurance company foreign investments in accordance with the Investments of Insurers Model Act adopted by the National Association of Insurance Commissioners (NAIC). The Investments of Insurers Model Act (Defined Standards Version) sets out general standards for investments (authorization and prudence) and provides for broad classes of permitted investments subject to aggregate and individual limitations for some categories.
