1. (a) Solely for the purpose of acquiring an investment that exceeds the quantitative limitations of 3 AAC 21.231 - 3 AAC 21.266, a life and health insurer may acquire, hold, or make an investment or engage in an investment practice described in 3 AAC 21.261. However, under this subsection, the life and health insurer may not acquire, hold, or make an investment or engage in an investment practice described in 3 AAC 21.261 if, as a result of and after giving effect to the transaction, the aggregate amount of investments then held by the life and health insurer under this subsection

   1. (1) would exceed three percent of the life and health insurer's admitted assets; or
   2. (2) as to one limitation in 3 AAC 21.231 - 3 AAC 21.266 would exceed one percent of the life and health insurer's admitted assets.

2. (b) In addition to the authority provided under (a) of this section, a life and health insurer may acquire, hold, or make an investment of any kind or engage in an investment practice described in 3 AAC 21.261 that is not specifically prohibited by 3 AAC 21.201 - 3 AAC 21.399, without regard to a requirement or limitation of 3 AAC 21.231 - 3 AAC 21.266 if, as a result of and after giving effect to the transaction, the aggregate amount of investments then held under this subsection would not exceed the lesser of

   1. (1) 10 percent of the life and health insurer's admitted assets; or
   2. (2) 75 percent of the life and health insurer's capital and surplus.

3. (c) In addition to an investment acquired under (a) and (b) of this section, a life and health insurer may acquire, hold, or make an investment of any kind or engage in an investment practice described in 3 AAC 21.261 that is not specifically prohibited by 3 AAC 21.201 - 3 AAC 21.399 without regard to the limitations of 3 AAC 21.231 - 3 AAC 21.266 if

   1. (1) the director grants prior approval;
   2. (2) the life and health insurer demonstrates that its investment is being made in a prudent manner and that the additional amount will be invested in a prudent manner; and

   3. (3) as a result of and after giving effect to the transaction, the aggregate amount of investments then held by the life and health insurer under this subsection does not exceed the greater of

      1. (A) 25 percent of the life and health insurer's capital and surplus; or
      2. (B) 100 percent of capital and surplus less 10 percent of the life and health insurer's admitted assets.
4. (d) A life and health insurer may not acquire, hold, or make an investment or engage in an investment practice under this section if, as a result of and after giving effect to the transaction, the aggregate amount of all investments in any one person then held by the life and health insurer under this section would exceed three percent of the life and health insurer's admitted assets.
5. (e) A life and health insurer may not acquire, hold, or make an investment under this section that is prohibited under 3 AAC 21.216 or not permitted under 3 AAC 21.271 or acquired as an additional derivative instrument under 3 AAC 21.271.

(Eff. 12/28/2001, Register 160)

Authority: AS 21.06.090, AS 21.18.040, AS 21.21.255, AS 21.18.010, AS 21.21.010, AS 21.21.420, AS 21.18.030, AS 21.21.020