760 IAC 1-7-5 Accounting; transfers between accounts

Sec. 5. Any insurance company which issues Class I(c) contracts shall establish such administrative and accounting procedures as are necessary to properly identify a segregated investment account of the company derived from or in relation to contributions, premiums or considerations received by it under Class I(c) contracts. A Class I(c) contract may provide that all or a portion of the segregated investment account is derived from a designated percentage of specific assets in the company's general investment portfolio. No insurance company which issues Class I(c) contracts shall transfer assets between segregated investment accounts or between any such account and other accounts except for the purposes of (1) conducting the business of such account in accordance with provisions of the Class I(c) contract, or (2) making the adjustments necessitated by the Class I(c) contract and the mortality experience adjustment specified in Section 59 ( IC 27-1-5-1) of the Indiana insurance laws, and then only if such transfers are made– (i) by a transfer of cash, or (ii) by a transfer of securities having a value which can readily be determined in the market place, provided such transfer of securities has been approved by the department in advance of the transfer, or (iii) by a transfer of assets other than cash or securities having a value which can readily be determined in the market place if, in the opinion of the department, such transfer is not inequitable, provided such transfer of other assets has been approved by the department in advance of the transfer. This provision shall not preclude or prohibit any of the following procedures: (a) The exchange of securities in a segregated investment account may be made for cash from the general investment account of an insurance company, or the exchange of securities in such general investment account may be made for cash from a segregated investment account if (i) the securities so exchanged have values which can readily be determined in the market place, (ii) the exchange is made on the basis of the market values applicable to the securities at the time of the exchange, and (iii) the consent of the department to such exchange has been obtained in advance. (b) The sale of securities, for cash, from a segregated investment account and the purchase thereof, for cash, by an insurance company for its general investment account may be made in bona fide sale and purchase transactions involving one or more persons other than the insurance company and its officers or affiliates. (c) The sale of securities, for cash, from the general investment account of an insurance company and the purchase thereof, for cash, for a segregated investment account of the company selling such securities may be made in bona fide sale and purchase transactions involving one or more persons other than the insurance company and its officers or affiliates. (d) In respect of a Class I(c) contract providing that all or a portion of the segregated investment account is derived from a designated percentage of specific assets in the company's general investment portfolio, a change in said designated percentage may be made provided the change arises (i) by reason of the contractual withdrawals from or additions to such account or (ii) by reason of changes in said specific assets because of acquisitions or disposals.