Iowa Administrative Code › Agency 191 - Insurance Division › Life and Health Insurance › Chapter 31 - Life Insurance Companies-variable Annuities Contracts › Rule 191-31.4 - Separate Account or Accounts and Investments

Current through Register Vol. 47, No. 3, July 24, 2024
Any domestic life insurance company issuing variable
				  contracts shall establish one or more separate or segregated accounts as
				  provided in Iowa Code section
				  50832.
				  to invest and reinvest all or any of the amounts received in connection with
				  such variable contracts subject to the following limitations.
(1) Except as hereinafter provided, amounts
				allocated to any separate or segregated account and accumulation thereon may be
				invested and reinvested without regard to any requirements or limitations
				prescribed by the laws of this state governing the investments of life
				insurance companies; provided, that to the extent that the company's reserve
				liability with regard to benefits guaranteed as to dollar amount and duration
				and funds guaranteed as to principal amount or stated rate of interest is
				maintained in any separate or segregated account, a portion of the assets of
				such separate or segregated account at least equal to such reserve liability
				shall be, except as the commissioner may otherwise approve, invested in
				accordance with laws of this state governing the investments of life insurance
				companies. The investments in such separate or segregated account or accounts
				shall not be taken into account in applying the investment limitations
				applicable to the investments of the company.
(2) With respect to 75 percent of the market
				value of the total assets in a separate or segregated account, no such company
				shall purchase or otherwise acquire the securities of any issuer, other than
				securities issued or guaranteed as to principal and interest by the United
				States, if immediately after such purchase or acquisition the market value of
				such investment, together with prior investments of such separate or segregated
				account in such security taken at market, would exceed 5 percent of the market
				value of the assets of said separate or segregated account; provided, however,
				that the commissioner may waive such limitation if in the commissioner's
				opinion such waiver will not render the operation of such separate or
				segregated account hazardous to the public or the policyholders in this
				state.
(3) The separate or
				segregated account shall not invest in the voting securities of a single issuer
				in an amount in excess of 10 percent of the total issued and outstanding voting
				securities of such issuer The foregoing shall not apply with respect to
				securities held in separate or segregated accounts, the voting rights in which
				are exercisable only in accordance with instructions from persons having
				interests in such accounts.
(4) The
				limitations in 31.4(2) and 31.4(3) shall not apply to the investments of a
				separate or segregated account in the securities of an investment company
				registered under the investment company Act of 1940, provided the investments
				of such investment companies comply in substance with 31.4(2) and 31.4(3)
				hereof
(5) Unless otherwise
				approved by the commissioner, assets allocated to a separate or segregated
				account shall be valued at their market value on the date of valuation or, if
				there is no readily available market, then as provided under the terms of the
				contract or the rules or other written agreement applicable to such separate or
				segregated account; provided, that the portion of the assets of such separate
				or segregated account equal to the company's reserve liability with regard to
				the benefits and funds referred to in 31.4(1), if any, shall be valued in
				accordance with the rules otherwise applicable to the company's
				assets.
(6) The provisions of Iowa
				Code section
				5088.
				and any regulations applicable to the officers and directors of insurance
				companies with respect to conflicts of interest shall also apply to members of
				any separate or segregated account's committee, board or other similar body. No
				officer or director of such company nor any member of the committee, board or
				body of a separate or segregated account shall receive directly or indirectly
				any commission or any other compensation with respect to the purchase or sale
				of assets of such separate or segregated account.
(7) All contracts on a variable basis shall
				state that the portion of the assets of any such separate or segregated
				accounts equal to the reserves and other contract liabilities with respect to
				such account shall not be chargeable with liabilities arising out of any other
				business the company may conduct.
(8) Notwithstanding any other provisions in
				these rules, a company may:
a. With respect
				to any separate or segregated account registered with the Securities and
				Exchange Commission as a unit investment trust exercise voting rights in
				connection with any securities of a regulated investment company registered
				under the Investment Company Act of 1940 and held in such separate or
				segregated account in accordance with instructions from persons having
				interests in such accounts ratably as determined by the company, or
b. With respect to any separate or segregated
				account registered with the Securities and Exchange Commission as a management
				investment company, establish for such account a committee, board or other
				body, the members of which may or may not be otherwise affiliated with such
				company and may be elected to such membership by the vote of persons having
				interests in such account ratably as determined by the company. Such committee,
				board or other body may have the power, exercisable alone or in conjunction
				with others, to manage such account or accounts and the investment of its
				assets.
A company, committee, board or other body may make such other
				  provisions in respect to any such separate or segregated account as may be
				  deemed appropriate to facilitate compliance with requirements of any federal or
				  state law now or hereafter in effect; provided that the commissioner approves
				  such provisions as not hazardous to the public or the company's policyholders
				  in this state.