Virginia Code 38.2-1421: Business entity obligations
A. High grade. A domestic insurer may invest in any high grade obligations issued, assumed or guaranteed by any solvent business entity that is not in default as to principal or interest on the date of investment and which is created or existing under the laws of the United States or any state.
Terms Used In Virginia Code 38.2-1421
- Business entity: means a corporation, association, partnership, joint venture, trust, church, or religious body. See Virginia Code 38.2-1401
- Commission: means the State Corporation Commission. See Virginia Code 38.2-100
- Date of investment: means the date on which funds are disbursed for an investment. See Virginia Code 38.2-1401
- High grade obligations: means obligations which (i) are rated one or two by the Securities Valuation Office of the National Association of Insurance Commissioners or (ii) if not rated by the Securities Valuation Office, are rated in an equivalent grade by a national rating agency recognized by the Commission. See Virginia Code 38.2-1401
- Insurer: means a company licensed pursuant to Chapter 10 (§ 38. See Virginia Code 38.2-1401
- Lower grade obligations: means obligations which (i) are rated four, five, or six by the Securities Valuation Office of the National Association of Insurance Commissioners or (ii) if not rated by the Securities Valuation Office, are rated in an equivalent grade by a national rating agency recognized by the Commission. See Virginia Code 38.2-1401
- Medium grade obligations: means obligations which (i) are rated three by the Securities Valuation Office of the National Association of Insurance Commissioners or (ii) if not rated by the Securities Valuation office, are rated in an equivalent grade by a national rating agency recognized by the Commission. See Virginia Code 38.2-1401
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- State: means any commonwealth, state, territory, district or insular possession of the United States. See Virginia Code 38.2-100
- United States: includes the 50 states, the District of Columbia the Commonwealth of Puerto Rico, Guam, the Northern Mariana Islands and the United States Virgin Islands. See Virginia Code 1-255
B. Medium grade. A domestic issuer may invest in medium grade obligations issued, assumed or guaranteed by any solvent business entity that is not in default as to principal or interest on the date of investment and which is created or existing under the laws of the United States or any state.
C. Lower grade. A domestic insurer may invest in lower grade obligations rated 4 by the Securities Valuation Office of the National Association of Insurance Commissioners or, if not rated by the Securities Valuation Office, rated in an equivalent grade by a national rating agency recognized by the Commission that are issued, assumed or guaranteed by any solvent business entity that is not in default as to principal or interest on the date of investment and which is created or existing under the laws of the United States or any state.
D. As used in this section, “business entity obligations” shall not include any mortgage pass-through securities described in § 38.2-1437.1.
1983, c. 457, § 38.1-217.24; 1986, c. 562; 1992, c. 588; 1998, c. 414.