§ 23-91-213 - Segregated accounts required -- Exception.
23-91-213. Segregated accounts required -- Exception.
Except for employee welfare benefit plans regulated by the Employee Retirement Income Security Act of 1974, persons transacting the business of legal insurance, and any other business than insurance shall transact legal insurance wholly within a segregated account in accordance with the following requirements:
(1) The segregated account must satisfy the financial requirements for issuance of a certificate of authority;
(2) (A) (i) Except under subdivisions (6) and (7) of this section, the income and assets attributable to a segregated account shall always remain identifiable with the account.
(ii) However, unless the Insurance Commissioner so orders, the assets need not be kept physically separate from other assets of the person.
(B) The income, gains, and losses, whether or not realized, from assets attributable to a segregated account shall be credited to or charged against the account without regard to other income, gains, or losses of the person;
(3) Except under subdivision (4) of this section, assets attributable to a segregated account shall not be chargeable with any liabilities arising out of any other business of the person, nor shall any assets not attributable to the account be chargeable with any liabilities arising out of it;
(4) Claims remaining unpaid after completion of any liquidation under the applicable and relevant provisions of 23-68-111 and 23-68-112 shall have liens on the interests of shareholders, if any, in all of the person's assets that are not liquidated. The segregated account shall be deemed an insurer within the meaning of 23-68-102;
(5) Assets allocated to segregated accounts are the property of the person, which is not and shall not hold itself out to be a trustee of the assets;
(6) A person may allocate a portion or part of a particular asset to the segregated account; and
(7) By an identifiable act, the person may transfer assets to or from the segregated account if:
(A) The terms are fair and reasonable; and
(B) The books, accounts, and records of each party are maintained so as to clearly and accurately disclose the precise nature and details of the transaction.