§ 87. Investment of surplus or reserve. 1. Any of the surplus or reserve funds belonging to the state insurance fund, by order of the commissioners, approved by the superintendent of insurance, may be invested in the types of securities described in subdivisions one, two, three, four, five, six, eleven, twelve, twelve-a, thirteen, fourteen, fifteen, nineteen, twenty, twenty-one, twenty-one-a, twenty-four, twenty-four-a, twenty-four-b, twenty-four-c and twenty-five of section two hundred thirty-five of the banking law or, up to fifty percent of such surplus or reserve funds, in the types of securities or investments described in paragraphs two, three, eight and ten of subsection (a) of section one thousand four hundred four of the insurance law except that up to ten percent of the surplus and reserve funds belonging to the state insurance fund that may be invested in the securities of any solvent American institution or of an investment company as described in such paragraphs may be invested irrespective of the rating of such institution's obligations or other similar qualitative standards described in paragraphs two, three, eight and ten of such subsection, but shall not include any derivative instrument or derivative transaction or any investment found by the superintendent of insurance to be against public policy. Any of the surplus or reserve funds belonging to the state insurance fund, upon like approval of the superintendent of insurance, may be loaned on the pledge of any such securities. The commissioners, upon like approval of the superintendent of insurance, may also sell any of such securities or investments. 2. (a) Any securities belonging to the state insurance fund may, by order of the commissioners, approved by the superintendent of insurance, be loaned under a security loan agreement, as defined in paragraph (b) of this subdivision, entered into with a registered broker-dealer, or a New York state or national bank or trust company, with the custodial bank of the state insurance fund or another person or entity, approved by the commissioner of taxation and finance, which specializes in security loan transactions acting as the agent in arranging such agreement. The commissioners shall monitor the market value of the loaned securities daily. In no event shall the commissioners allow the value of the collateral posted to fall below the market value of the loaned securities. (b) For purposes of this section, "security loan agreement" shall mean a written contract, the terms of which have been approved by the commissioner of taxation and finance, whereby the state insurance fund (the lender) agrees to lend securities to a broker-dealer, bank or trust company described in paragraph (a) of this subdivision (the borrower) for a period not to exceed one year. However, such agreement shall be subject to the following limitations: (i) the lender must retain the right to collect from the borrower all dividends, interest, premiums, rights, and any other distributions to which the lender would otherwise have been entitled; (ii) the lender may waive the right to vote the securities during the term of such agreement; (iii) the lender must retain the right to terminate such agreement upon not more than five business days' notice; (iv) the borrower shall provide as collateral to the lender cash or direct obligations of the United States of America or any agency or instrumentality thereof or obligations fully guaranteed by the United States of America that are eligible for investment by the state insurance fund under subdivision one of this section, provided that such obligations may in no event consist of derivative securities; and (v) such agreement shall provide for payment of additional collateral on a daily basis, or at such time as the value of the loaned securities increases to agreed upon ratios.3. All such securities or evidences of indebtedness shall be placed in the hands of the commissioner of taxation and finance who shall be the custodian thereof. He or she shall collect the principal and interest thereof, when due, and pay the same into the state insurance fund. The commissioner of taxation and finance shall pay all vouchers drawn on the state insurance fund for the making of such investments when signed by the chair of the commissioners, the executive director or a deputy executive director of the state insurance fund upon delivery of such securities or evidences of indebtedness to him or her, when there is attached to such vouchers the approval of the state superintendent of insurance.
§ 87. Investment of surplus or reserve. 1. Any of the surplus or reserve funds belonging to the state insurance fund, by order of the commissioners, approved by the superintendent of insurance, may be invested in the types of securities described in subdivisions one, two, three, four, five, six, eleven, twelve, twelve-a, thirteen, fourteen, fifteen, nineteen, twenty, twenty-one, twenty-one-a, twenty-four, twenty-four-a, twenty-four-b, twenty-four-c and twenty-five of section two hundred thirty-five of the banking law or, up to fifty percent of such surplus or reserve funds, in the types of securities or investments described in paragraphs two, three, eight and ten of subsection (a) of section one thousand four hundred four of the insurance law except that up to ten percent of the surplus and reserve funds belonging to the state insurance fund that may be invested in the securities of any solvent American institution or of an investment company as described in such paragraphs may be invested irrespective of the rating of such institution's obligations or other similar qualitative standards described in paragraphs two, three, eight and ten of such subsection, but shall not include any derivative instrument or derivative transaction or any investment found by the superintendent of insurance to be against public policy. Any of the surplus or reserve funds belonging to the state insurance fund, upon like approval of the superintendent of insurance, may be loaned on the pledge of any such securities. The commissioners, upon like approval of the superintendent of insurance, may also sell any of such securities or investments. 2. (a) Any securities belonging to the state insurance fund may, by order of the commissioners, approved by the superintendent of insurance, be loaned under a security loan agreement, as defined in paragraph (b) of this subdivision, entered into with a registered broker-dealer, or a New York state or national bank or trust company, with the custodial bank of the state insurance fund or another person or entity, approved by the commissioner of taxation and finance, which specializes in security loan transactions acting as the agent in arranging such agreement. The commissioners shall monitor the market value of the loaned securities daily. In no event shall the commissioners allow the value of the collateral posted to fall below the market value of the loaned securities. (b) For purposes of this section, "security loan agreement" shall mean a written contract, the terms of which have been approved by the commissioner of taxation and finance, whereby the state insurance fund (the lender) agrees to lend securities to a broker-dealer, bank or trust company described in paragraph (a) of this subdivision (the borrower) for a period not to exceed one year. However, such agreement shall be subject to the following limitations: (i) the lender must retain the right to collect from the borrower all dividends, interest, premiums, rights, and any other distributions to which the lender would otherwise have been entitled; (ii) the lender may waive the right to vote the securities during the term of such agreement; (iii) the lender must retain the right to terminate such agreement upon not more than five business days' notice; (iv) the borrower shall provide as collateral to the lender cash or direct obligations of the United States of America or any agency or instrumentality thereof or obligations fully guaranteed by the United States of America that are eligible for investment by the state insurance fund under subdivision one of this section, provided that such obligations may in no event consist of derivative securities; and (v) such agreement shall provide for payment of additional collateral on a daily basis, or at such time as the value of the loaned securities increases to agreed upon ratios.3. All such securities or evidences of indebtedness shall be placed in the hands of the commissioner of taxation and finance who shall be the custodian thereof. He or she shall collect the principal and interest thereof, when due, and pay the same into the state insurance fund. The commissioner of taxation and finance shall pay all vouchers drawn on the state insurance fund for the making of such investments when signed by the chair of the commissioners, the executive director or a deputy executive director of the state insurance fund upon delivery of such securities or evidences of indebtedness to him or her, when there is attached to such vouchers the approval of the state superintendent of insurance.
§ 87. Investment of surplus or reserve. 1. Any of the surplus or reserve funds belonging to the state insurance fund, by order of the commissioners, approved by the superintendent of insurance, may be invested in the types of securities described in subdivisions one, two, three, four, five, six, eleven, twelve, twelve-a, thirteen, fourteen, fifteen, nineteen, twenty, twenty-one, twenty-one-a, twenty-four, twenty-four-a, twenty-four-b, twenty-four-c and twenty-five of section two hundred thirty-five of the banking law or, up to fifty percent of such surplus or reserve funds, in the types of securities or investments described in paragraphs two, three, eight and ten of subsection (a) of section one thousand four hundred four of the insurance law except that up to ten percent of the surplus and reserve funds belonging to the state insurance fund that may be invested in the securities of any solvent American institution or of an investment company as described in such paragraphs may be invested irrespective of the rating of such institution's obligations or other similar qualitative standards described in paragraphs two, three, eight and ten of such subsection, but shall not include any derivative instrument or derivative transaction or any investment found by the superintendent of insurance to be against public policy. Any of the surplus or reserve funds belonging to the state insurance fund, upon like approval of the superintendent of insurance, may be loaned on the pledge of any such securities. The commissioners, upon like approval of the superintendent of insurance, may also sell any of such securities or investments. 2. (a) Any securities belonging to the state insurance fund may, by order of the commissioners, approved by the superintendent of insurance, be loaned under a security loan agreement, as defined in paragraph (b) of this subdivision, entered into with a registered broker-dealer, or a New York state or national bank or trust company, with the custodial bank of the state insurance fund or another person or entity, approved by the commissioner of taxation and finance, which specializes in security loan transactions acting as the agent in arranging such agreement. The commissioners shall monitor the market value of the loaned securities daily. In no event shall the commissioners allow the value of the collateral posted to fall below the market value of the loaned securities. (b) For purposes of this section, "security loan agreement" shall mean a written contract, the terms of which have been approved by the commissioner of taxation and finance, whereby the state insurance fund (the lender) agrees to lend securities to a broker-dealer, bank or trust company described in paragraph (a) of this subdivision (the borrower) for a period not to exceed one year. However, such agreement shall be subject to the following limitations: (i) the lender must retain the right to collect from the borrower all dividends, interest, premiums, rights, and any other distributions to which the lender would otherwise have been entitled; (ii) the lender may waive the right to vote the securities during the term of such agreement; (iii) the lender must retain the right to terminate such agreement upon not more than five business days' notice; (iv) the borrower shall provide as collateral to the lender cash or direct obligations of the United States of America or any agency or instrumentality thereof or obligations fully guaranteed by the United States of America that are eligible for investment by the state insurance fund under subdivision one of this section, provided that such obligations may in no event consist of derivative securities; and (v) such agreement shall provide for payment of additional collateral on a daily basis, or at such time as the value of the loaned securities increases to agreed upon ratios.3. All such securities or evidences of indebtedness shall be placed in the hands of the commissioner of taxation and finance who shall be the custodian thereof. He or she shall collect the principal and interest thereof, when due, and pay the same into the state insurance fund. The commissioner of taxation and finance shall pay all vouchers drawn on the state insurance fund for the making of such investments when signed by the chair of the commissioners, the executive director or a deputy executive director of the state insurance fund upon delivery of such securities or evidences of indebtedness to him or her, when there is attached to such vouchers the approval of the state superintendent of insurance.
