(A) An insurer, directly or indirectly, may not:

(1) invest in an obligation or security or make a guarantee for the benefit of or in favor of an officer or director of the insurer, except as provided in § 38-12-70;

Terms Used In South Carolina Code 38-12-60

  • Affiliate: means , in respect to a person, another person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the person. See South Carolina Code 38-12-30
  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Business entity: means a sole proprietorship, corporation, limited liability company, association, general or limited partnership, joint stock company, joint venture, mutual fund, bank, trust, real estate investment trust, joint tenancy, or other similar form of business organization, whether organized for-profit or not-for-profit. See South Carolina Code 38-12-30
  • directly: when used in connection with an obligation, means that the designated obligor is primarily liable on the instrument representing the obligation. See South Carolina Code 38-12-30
  • Director: means the person who is appointed by the Governor upon the advice and consent of the Senate and who is responsible for the operation and management of the department. See South Carolina Code 38-1-20
  • insurance: includes annuities. See South Carolina Code 38-1-20
  • Insurer: includes a corporation, fraternal organization, burial association, other association, partnership, society, order, individual, or aggregation of individuals engaging or proposing or attempting to engage as principals in any kind of insurance or surety business, including the exchanging of reciprocal or interinsurance contracts between individuals, partnerships, and corporations. See South Carolina Code 38-1-20
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Obligation: means a bond, note, debenture, trust certificate including an equipment trust certificate, production payment, negotiable bank certificate of deposit, bankers' acceptance, asset-backed security, credit tenant loan, loan secured by financing a net lease or net leases, and other evidence of indebtedness for the payment of money, or participations, certificates, or other evidences of an interest in any of them, whether constituting a general obligation of the issuer or payable only out of certain revenues or certain funds pledged or otherwise dedicated for payment. See South Carolina Code 38-12-30
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.

(2) invest in an obligation or security, make a guarantee for the benefit of or in favor of, or make other investments in a business entity of which ten percent or more of the voting securities or equity interests are owned directly or indirectly by or for the benefit of one or more officers or directors of the insurer, except as authorized in Chapter 21 of this title or as provided in § 38-12-70;

(3) engage on its own behalf or through one or more affiliates in a transaction or series of transactions designed to evade the prohibitions of this chapter;

(4) invest in a partnership as a general partner, except that an insurer may make an investment as a general partner:

(a) if all other partners in the partnership are subsidiaries or other insurance company affiliates of the insurer;

(b) for the purpose of:

(i) meeting cash calls committed to before the effective date of this chapter;

(ii) completing those specific projects or activities of the partnership in which the insurer was a general partner as of the effective date of this chapter that had been undertaken as of that date; or

(iii) making capital improvements to property owned by the partnership on the effective date of this chapter if the insurer was a general partner as of that date; or

(c) in accordance with § 38-12-40(C); or

(5) invest in or lend its funds upon the security of shares of its own stock, except as authorized by other provisions of this title, except that those shares must not be admitted assets of the insurer.

(B) This section does not prohibit a subsidiary or other affiliate of the insurer from becoming a general partner.

  Previous section
Next section  
 Article 1 Contents