§431:6-323  Separate accounts.  (a)  Alife insurer, after adoption of a resolution by its board of directors andcertification thereof to the commissioner, may allocate to one or more separateaccounts, in accordance with the terms of a written agreement or a contract ona variable basis, amounts which are paid to the insurer, in connection with apension, retirement or profit sharing plan, or in connection with a contract ona variable basis, whether on an individual or group basis, and which amounts areto be applied to purchase retirement benefits in fixed or in variable dollaramounts, or both, or to provide benefits in accordance with a contract on avariable basis.

The income, if any, and gains or lossesrealized or unrealized on each account may be credited to or charged againstthe amount allocated to the account in accordance with the agreement, withoutregard to the other income, gains or losses of the insurer.  The commissionermay prescribe reasonable limitations on charges against and permissibledeductions from the investment experience credited to life insurance contractson a variable basis.  Notwithstanding any other provision in the insurer'sarticles of incorporation or in this code, the amounts allocated to theaccounts and accumulations thereon may be invested and reinvested in any classof loans and investments specified in the agreement, or, with respect to lifeinsurance contracts on a variable basis, as prescribed by the commissioner, andthe loans and investments shall not be considered in applying any limitation inthis article.  The commissioner, with respect to separate accounts for lifeinsurance on a variable basis, may establish reasonable standards forprocedures to be used in changing investment policy and provisions to safeguardthe rights of insured persons and beneficiaries.

(b)  Contract on a variable basis means acontract issued by an insurer providing for the dollar amount of benefits orother contractual payments or values thereunder to vary so as to reflectinvestment results of a segregated portfolio of investments or of a designatedaccount in which amounts received in connection with the contract have beenplaced and other contracts as may be approved by the commissioner.

(c)  Notwithstanding any other provision oflaw, a life insurer, if necessary to comply with the Investment Company Act of1940, with respect to any account or any portion thereof, may:

(1)  Exercise the voting rights of the stock or sharesor interest in accordance with instructions from the persons having thebeneficial interests in the account ratably according to their respectiveinterests in the account, or

(2)  Establish a committee for the account, themembers of which may be directors or officers or other employees of theinsurer, persons having no relationship to the insurer, or any combinationthereof, who may be elected to membership by the vote of the persons having thebeneficial interests in the account ratably according to their respectiveinterests in the account.  The committee alone, in conjunction with others, orby delegation to the insurer or any other person, as investment manager orinvestment adviser, may authorize purchases and sales of investments for theaccount if, as long as the life insurer or any subsidiary or affiliate of thelife insurer is the investment manager or investment adviser of the account,the investments of the account are eligible under this section.  If compliancewith the Investment Company Act of 1940 involves only a portion of the account,the insurer may establish a committee for only that portion, and its membersmay be elected by the vote of the persons having the beneficial interests inthe portion.  A committee for only a portion of the account may be given thefurther power to require the subdivision of the account into two accounts sothat the portion of the account with respect to which the committee is actingshall constitute a separate account.  If the committee so requires, the insurershall segregate, from the account being so subdivided, a portion of each assetheld with respect to the reserve liabilities of the account.  That portionshall be in the same proportion to the total of the asset as the reserveliability for the portion of the account with respect to which the committee isacting bears to the total reserve liability of the account; and notwithstandingany other provision of law, the assets so segregated shall be transferred to aseparate account with respect to which the committee shall act.

(d)  The investments and liabilities of theaccount shall at all times be clearly identifiable and distinguishable from theother investments and liabilities of the insurer.  A sale, transfer, orexchange of investments shall not be made between any of the separate accountsor between any other investment account of the company and one or more of theseparate accounts, except for the purpose of:

(1)  Conducting the business of the account inaccordance with subsections (a) and (c); or

(2)  Making adjustments necessitated by the contractfor mortality experience adjustment, and then only if the transfers are made bya transfer of cash or by a transfer of securities having a valuation that canreadily be determined in the marketplace.  The commissioner may require fordomestic life insurers that a transfer of cash or investments from a separateaccount or accounts to the company be approved in advance of the transfer.  Thecommissioner may prescribe reasonable limitations on charges against andpermissible deductions from separate accounts for life insurance contracts on avariable basis.

(e)  As used in this section, InvestmentCompany Act of 1940 means the Act of Congress approved August 22, 1940,entitled Investment Company Act of 1940 as amended from time to time, or anysimilar statute enacted in substitution therefor.

(f)  The commissioner may adopt rules pursuantto chapter 91. [L 1987, c 349, §5; am L 2004, c 122, §21]