Kentucky Administrative Regulations › Title 806 - PUBLIC PROTECTION CABINET - DEPARTMENT OF INSURANCE › Chapter 26 - Insider Trading of Equity Securities › Section 806 KAR 26:020 - Insider trading requirements

Current through Register Vol. 51, No. 1, July 1, 2024
RELATES TO: KRS 304.26-020-304.26-080
NECESSITY, FUNCTION, AND CONFORMITY:
				KRS
				304.2-110 provides that the Commissioner of
				Insurance may make reasonable rules and administrative regulations necessary
				for or as an aid to the effectuation of any provision of the Kentucky Insurance
				Code.
				KRS
				304.26-090 gives the commissioner the
				authority to promulgate administrative regulations to execute the functions
				vested in him under KRS Chapter 304, Subtitle 26, relating to insider trading.
				This administrative regulation sets forth the requirements upon insiders
				trading in equity securities of a domestic stock insurance company.
Section 1. General Application.
(1) Definition of certain items.
(a) "Insurer" means any domestic stock
			 insurance company with an equity security subject to the provisions of
			 KRS
			 304.26-020 to
			 304.26-090,
			 and not exempt thereunder.
(b)
			 "Act" means KRS Chapter 304, Subtitle 26.
(c) "Officer" means a president, vice
			 president, treasurer, actuary, secretary, controller, and any other person who
			 performs for the insurer functions corresponding to those performed by the
			 foregoing officers.
(d) "Equity
			 security" means any stock or similar security; or any voting trust certificate
			 of deposit for such a security; or any security convertible, with or without
			 consideration, into such a security, or carrying any warrant or right to
			 subscribe to or purchase such a security; or any such warrant or
			 right.
(e) Securities "held of
			 record."
1. For the purpose of determining
			 whether the equity securities of an insurer are held of record by 100 or more
			 persons, securities shall be deemed to be "held of record" by each person who
			 is identified as the owner of such securities on records of security holders
			 maintained by or on behalf of the insurer, subject to the following:
a. In any case where the records of security
			 holders have not been maintained in accordance with accepted practice, any
			 additional person who would be identified as such an owner on such records if
			 they had been maintained in accordance with accepted practice shall be included
			 as a holder of record.
b.
			 Securities identified as held of record by a corporation, a partnership, a
			 trust whether or not the trustees are named, or other organization shall be
			 included as so held by one (1) person.
c. Securities identified as held of record by
			 one (1) or more persons as trustees, executors, guardians, custodians or in
			 other fiduciary capacities with respect to a single trust, estate or account
			 shall be included as held of record by one (1) person.
d. Securities held by two (2) or more persons
			 as co-owners shall be included as held by one (1) person.
e. Each outstanding unregistered or bearer
			 certificate shall be included as held of record by a separate person, except to
			 the extent that the insurer can establish that, if such securities were
			 registered, they would be held of record, under the provisions of this rule, by
			 a lesser number of persons.
f.
			 Securities registered in substantially similar names where the insurer has
			 reasons to believe because of the address or other indications that such names
			 represent the same person, may be included as held of record by one (1)
			 person.
2.
			 Notwithstanding subparagraph 1 of this paragraph:
a. Securities held, to the knowledge of the
			 insurer, subject to a voting trust, deposit agreement or similar arrangement
			 shall be included as held of record by the record holders of the voting trust
			 certificates, certificates of deposit, receipts or similar evidences of
			 interest in such securities; provided however, that the insurer may rely in
			 good faith on such information as it is received in response to its request
			 from a nonaffiliated insurer of the certificates or evidences of
			 interest.
b. If the insurer knows
			 or has reason to know that the form of holding securities of record is used
			 primarily to circumvent the provisions of the Act, the beneficial owners of
			 such securities shall be deemed to be the record owners thereof.
c. "Class" means all securities of an insurer
			 which are of substantially similar character and the holders of which enjoy
			 substantially similar rights and privileges.