2005 Idaho Code - 41-727 — FOREIGN SECURITIES

                                  TITLE  41
                                  INSURANCE
                                  CHAPTER 7
                                 INVESTMENTS
    41-727.  FOREIGN SECURITIES. (1) Notwithstanding the definitions in
chapter 1, title 41, Idaho Code, for purposes of this section, the following
definitions shall apply:
    (a)  "Business entity" means a sole proprietorship, corporation, limited
    liability company, association, partnership, joint stock company, joint
    venture, mutual fund, trust, joint tenancy or other similar form of
    business organization, whether organized for-profit or not-for-profit.
    (b)  "Domestic jurisdiction" means the United States, Canada, and a state
    or political subdivision of the United States or Canada.
    (c)  "Foreign currency" means a currency other than that of the United
    States or Canada.
    (d)  "Foreign investment" means an investment in a foreign jurisdiction or
    in an asset domiciled in a foreign jurisdiction. An investment shall not
    be deemed to be foreign if the issuing business entity, qualified primary
    credit source or qualified guarantor is a domestic jurisdiction or a
    business entity domiciled in a domestic jurisdiction, unless:
         (i)   The issuing business entity is a shell business entity; and
         (ii)  The investment is not assumed, accepted, guaranteed or insured
         or otherwise backed by a domestic jurisdiction or a business entity
         that is not a shell business entity domiciled in a domestic
         jurisdiction.
    (e)  "Foreign jurisdiction" means a jurisdiction outside of the United
    States or Canada.
    (f)  "Qualified guarantor" means a guarantor against which an insurer has
    a direct claim for full and timely payment evidenced by a contractual
    right for which an enforcement action can be brought in a domestic
    jurisdiction.
    (g)  "Qualified primary credit source" means the credit source to which an
    insurer looks for payment as to an investment and against which an insurer
    has a direct claim for full and timely payment evidenced by a contractual
    right for which an enforcement action can be brought in a domestic
    jurisdiction.
    (h)  "Shell business entity" means a business entity having no economic
    substance except as a vehicle for owning interests in assets issued, owned
    or previously owned by a business entity domiciled in a foreign
    jurisdiction.
    (i)  "SVO" means the securities valuation office of the national
    association of insurance commissioners or any successor office established
    by the national association of insurance commissioners.
    (2)  Any insurance company organized under any law of this state may
invest, by loans or otherwise, any of its funds, or any part thereof, in
foreign investments of the same types as those that an insurer is permitted to
acquire under sections 41-707, 41-708, 41-711, 41-713, 41-714, 41-716 and
41-721(1), Idaho Code, if:
    (a)  The aggregate amount of foreign investments then held by the insurer
    does not exceed fifteen percent (15%) of its admitted assets; and
    (b)  The aggregate amount of foreign investments then held by the insurer
    in a single foreign jurisdiction does not exceed ten percent (10%) of its
    admitted assets for jurisdictions that have a sovereign debt rating of SVO
    1, or three percent (3%) of its admitted assets for all other
    jurisdictions.
    (3)  Any insurance company organized under any law of this state may
invest, by loans or otherwise, any of its funds, or any part thereof, in
investments of the same types as those that an insurer is permitted to acquire
under sections 41-707, 41-708, 41-711, 41-713, 41-714, 41-716 and 41-721(1),
Idaho Code, which are denominated in foreign currencies, whether or not they
are foreign investments acquired under subsection (2) of this section, if:
    (a)  The aggregate amount of investments then held by the insurer
    denominated in foreign currencies does not exceed ten percent (10%) of its
    admitted assets; and
    (b)  The aggregate amount of investments then held by the insurer
    denominated in the foreign currency of a single foreign jurisdiction does
    not exceed five percent (5%) of its admitted assets for jurisdictions that
    have a sovereign debt rating of SVO 1, or three percent (3%) of its
    admitted assets for all other jurisdictions.
    (4)  The investment limitations in subsections (2) and (3) of this section
computed on the basis of an insurer's admitted assets shall relate to the
amount as shown on the insurer's last annual report as filed with the
commissioner of insurance or a more recent quarterly financial statement as
filed with the commissioner, on a form prescribed by the national association
of insurance commissioners, within forty-five (45) days following the end of
the calendar quarter to which the interim statement pertains.
    (5)  Investments acquired under this section shall be aggregated with
investments of the same types made under sections 41-707, 41-708, 41-711,
41-713, 41-714, 41-716 and 41-721(1), Idaho Code, and in a similar manner, for
purposes of determining compliance with the limits, if any, contained in this
chapter.