The Vermont Statutes Online
The Statutes below include the actions of the 2024 session of the General Assembly.
NOTE: The Vermont Statutes Online is an unofficial copy of the Vermont Statutes Annotated that is provided as a convenience.
Title 8 : Banking and Insurance
Chapter 101 : Insurance Companies Generally
Subchapter 004 : INVESTMENTS AND LOANS
(Cite as: 8 V.S.A. § 3461a)-
§ 3461a. General limitations and diversification requirements for property and casualty, financial guaranty and mortgage guaranty insurers
(a) General five percent diversification.
(1) Except as otherwise specified in this subchapter, a domestic property and casualty, financial guaranty or mortgage guaranty insurer shall not acquire directly or indirectly through an investment subsidiary an investment under this subchapter if, as a result of and after giving effect to the investment, the insurer would hold more than five percent of its admitted assets in investments of all kinds issued, assumed, accepted, insured, or guaranteed by a single person.
(2) This five percent limitation shall not apply to the aggregate amounts insured by a single financial guaranty insurer with the highest generic rating issued by a nationally recognized statistical rating organization.
(3) Asset-backed securities shall not be subject to the limitations of subdivision (1) of this subsection; however, an insurer shall not acquire an asset-backed security if, as a result of and after giving effect to the investment, the aggregate amount of asset-backed securities secured by or evidencing an interest in a single asset or single pool of assets held by a trust or other business entity then held by the insurer would exceed five percent of its admitted assets.
(b) An insurer subject to this section shall comply with applicable regulations addressing investments in lower and medium grade obligations.
(c) Canadian investments.
(1) An insurer subject to this section shall not acquire, directly or indirectly through an investment subsidiary, any Canadian investments authorized by this subchapter, if, as a result of and after giving effect to the investment, the aggregate amount of these investments then held by the insurer would exceed 40 percent of its admitted assets or if the aggregate amount of Canadian investments not acquired under subdivision 3461c(2) of this subchapter then held by the insurer would exceed 25 percent of its admitted assets.
(2) However, as to an insurer that is authorized to do business in Canada or that has outstanding insurance, annuity or reinsurance contracts on lives or risks resident or located in Canada and denominated in Canadian currency, the limitations of subdivision (1) of this subsection shall be increased by the greater of:
(A) the amount the insurer is required by Canadian law to invest in Canada or to be denominated in Canadian currency; or
(B) 125 percent of the amount of its reserves and other obligations under contracts on risks resident or located in Canada. (Added 1999, No. 84 (Adj. Sess.), § 2, eff. April 19, 2000.)
