1. (a) An insurer shall not have at any one time any single investment or combination of investments in or loans upon the security of the obligations, property, or securities of any one person aggregating in cost to the insurer in excess of the greater of 10 percent of such insurer’s assets or the total of its capital and surplus, as shown in the latest annual report of the insurer filed pursuant to subsection (a) of Section 27-3-26 of the Alabama Insurance Code, less the minimum capital and surplus required of said insurer for authority to transact insurance by Sections 27-3-7 and 27-3-8 of the Alabama Insurance Code.

   The restriction of this subsection shall not apply to evidences of indebtedness issued, assumed, or guaranteed by the United States of America or any department, agency, or instrumentality thereof or by any state of the United States.

2. (b) An insurer shall at all times invest and maintain invested funds in cash and assets allowed in the following sections of this chapter in an amount not less than the capital required of it to transact insurance by Section 27-3-7 of the Alabama Insurance Code:

   1. (1) Section 27-41-7 (United States government obligations).
   2. (2) Section 27-41-9 (state, county, municipal, and school obligations).
   3. (3) Section 27-41-29 (mortgage loans).
3. (c) An insurer shall at all times invest and maintain invested funds in cash and the investments prescribed in this chapter in an amount not less than the amount of the reserves under its policies and annuity contracts in force.
4. (d) Limits as to investments shall apply as stated in specific sections relating to particular kinds of investments.

(Acts 1977, No. 408, p. 530, §6.)