Title 38a — Title 38a: Insurance

Sec. 38a-102. Investments. Derivative financial transactions. Regulations. (a) Except as otherwise limited or prohibited by sections 38a-102 to 38a-102h, inclusive, or by regulation adopted by the Insurance Commissioner pursuant hereto, a domestic insurance company may make or ac…

Sec. 38a-102a. Nonadmitted investment assets. Divestiture order, notice and hearing. (a) Investments made in excess of the limits prescribed in sections 38a-102 to 38a-102h, inclusive, shall be considered nonadmitted assets of an insurance company only to the extent of such exces…

Sec. 38a-102b. Definitions. For the purposes of sections 38a-102 to 38a-102h, inclusive: (1) “Cap” means an option contract wherein the seller, in return for a premium, agrees to limit the purchaser's risk associated with an increase in a reference rate or index. (2) “Collar” mea…

Sec. 38a-102c. Investments of admitted assets. Limitations. (a) A domestic insurer may invest up to ten per cent of admitted assets per obligor in obligations (1) issued, assumed or guaranteed by any agency, political subdivision or instrumentality of any state which obligations …

Sec. 38a-102d. Affiliate relationships in the investment of admitted assets. Limitations. (a) In addition to investments in common stock, preferred stock, debt obligations and other securities permitted under sections 38a-102 to 38a-102h, inclusive, a domestic insurer may also: (…

Sec. 38a-102e. Loan or investment prohibition. No domestic insurer shall make any loan or investment, other than a life insurance policy loan secured by its policies in an amount not exceeding the net reserve value thereof, unless authorized or approved by its board of directors …

Sec. 38a-102f. Prohibition of compensation for negotiating a loan. No director or officer of a domestic insurer shall receive any money or valuable consideration for negotiating, procuring or recommending any loan from such domestic insurer or for selling or aiding in the sale of…

Sec. 38a-102g. Investments of foreign and alien insurers. Foreign and alien insurers, as defined in section 38a-1, transacting the business of insurance in this state, shall have assets of the same general character and quality and policies and procedures relating to the approval…

Sec. 38a-102h. Policies and procedures re use of special knowledge or information. Each domestic insurer shall adopt policy and implementation procedures designed to prevent directors, officers, employees or any other person from inappropriately benefiting, either directly or ind…

Sec. 38a-102i. Exceptions. None of the provisions of sections 38a-102 to 38a-102h, inclusive, shall be preempted by the provisions of section 106 of Title I of the Secondary Mortgage Market Enhancement Act of 1984, 15 USC Section 77r-1. (P.A. 91-356, S. 2, 3.)

Secs. 38a-103 to 38a-116. Reserved for future use. PART IV INSIDER TRADING OF EQUITY SECURITIES

Sec. 38a-117. (Formerly Sec. 38-68a). Insider trading of equity securities. Definitions. As used in sections 38a-118 to 38a-124, inclusive, “equity security” means any stock or similar security, or any security convertible, with or without consideration, into such a security, or …

Sec. 38a-118. (Formerly Sec. 38-68b). Beneficial owners of securities to file with commissioner. Every person who is directly or indirectly the beneficial owner of more than ten per cent of any class of any equity security of a domestic stock insurance company or who is an office…

Sec. 38a-119. (Formerly Sec. 38-68c). Disposition of certain profits realized by owners and officers. For the purpose of preventing the unfair use of information which may have been obtained by such beneficial owner, director or officer by reason of his relationship to such domes…

Sec. 38a-120. (Formerly Sec. 38-68d). Sales of securities restricted. No such beneficial owner, director or officer, directly or indirectly, shall sell any equity security of such company if the person selling the security or his principal (i) does not own the security sold, or (…

Sec. 38a-121. (Formerly Sec. 38-68e). Excepted transactions. The provisions of section 38a-119 shall not apply to any purchase and sale, or sale and purchase, and the provisions of section 38a-120 shall not apply to any sale, of an equity security of a domestic stock insurance co…

Sec. 38a-122. (Formerly Sec. 38-68f). Foreign or domestic arbitrage transactions. The provisions of sections 38a-118, 38a-119 and 38a-120 shall not apply to foreign or domestic arbitrage transactions unless made in contravention of such regulations as the commissioner may adopt i…

Sec. 38a-123. (Formerly Sec. 38-68g). Securities of certain companies not covered. The provisions of sections 38a-118, 38a-119 and 38a-120 shall not apply to any equity securities of a domestic stock insurance company if (i) any class of its equity securities shall be registered,…

Sec. 38a-124. (Formerly Sec. 38-68h). Regulations. The commissioner may, by regulation, exempt in whole or in part any company or class of companies, and any officer, director or beneficial owner of securities of any company, from the provisions of sections 38a-117 to 38a-123, in…

Secs. 38a-125 to 38a-128. Reserved for future use. PART V ACQUISITION OF CONTROLLING INTEREST

Sec. 38a-129. (Formerly Sec. 38-39a). Purpose. Definitions. Applicability to captive insurance companies. (a) It shall be the purpose of sections 38a-129 to 38a-140, inclusive, to safeguard the financial security of Connecticut domestic insurance companies by empowering the Insur…

Sec. 38a-129a. Presumption of control. (a) For the purposes of sections 38a-129 to 38a-140, inclusive, control shall be presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote, or holds proxies representing, ten per cent or more of th…

Sec. 38a-130. (Formerly Sec. 38-39b). Acquisition and divestiture of domestic insurance companies. Required statement and notice filings. Violations. (a)(1) No person other than the issuer shall make a tender offer for or a request or invitation for tenders of, enter into any agr…

Sec. 38a-131. (Formerly Sec. 38-39c). Acquisitions. Exemptions. Preacquisition notifications. Violations of competitive standards. Hearing. Penalties. (a) For purposes of this section, (1) “acquisition” includes any agreement, arrangement or activity the consummation of which wil…

Sec. 38a-132. (Formerly Sec. 38-39d). Approval of acquisitions. Hearing. Expenses. (a) The commissioner shall approve any merger or other acquisition of control referred to in subsection (a) of section 38a-130 unless, after a public hearing, the commissioner finds that: (1) After…

Sec. 38a-133. (Formerly Sec. 38-39e). Exemptions. The provisions of sections 38a-130 and 38a-132 and subsection (i) of section 38a-136 shall not apply to any offer, request, invitation, agreement or acquisition that the commissioner by order shall exempt therefrom as (1) not havi…

Sec. 38a-134. (Formerly Sec. 38-39f). Nonvotable securities. Injunctive relief. (a) No security which is the subject of any agreement or arrangement regarding acquisition or which is acquired or to be acquired in contravention of the provisions of sections 38a-129 to 38a-140, inc…

Sec. 38a-135. (Formerly Sec. 38-39g). Insurance holding company system member registration. Registration statement. Annual enterprise risk report. Group capital calculation. Liquidity stress test framework. Termination of registration statement. Disclaimer of affiliation. Exempti…

Sec. 38a-136. (Formerly Sec. 38-39h). Requirements re transactions within an insurance holding company system. Prohibited transactions. Extraordinary dividends or distributions. Affiliate consent to jurisdiction. (a) Transactions within an insurance holding company system to whic…

Sec. 38a-137. (Formerly Sec. 38-39i). Confidentiality of information. (a) All information, documents, materials and copies thereof obtained by or disclosed to the commissioner or any other person in the course of an examination or investigation made pursuant to section 38a-14a an…

Sec. 38a-138. (Formerly Sec. 38-39j). Regulations. The commissioner may, after a public hearing called for the purpose, notice of which hearing shall be published in the Connecticut Law Journal at least thirty days prior to the date of such hearing, promulgate such regulations, i…

Sec. 38a-139. (Formerly Sec. 38-39k). Appeals. (a) Any person aggrieved by any regulation, order or other action of the commissioner pursuant to sections 38a-129 to 38a-l40, inclusive, or any failure of the commissioner to act as required by said sections may appeal therefrom to …

Sec. 38a-140. (Formerly Sec. 38-39l). Remedial and penal provisions. (a)(1) Whenever it appears to the commissioner that any insurance company or any director, officer, employee or agent thereof has committed or is about to commit a violation of sections 38a-129 to 38a-140, inclu…

Sec. 38a-141. (Formerly Sec. 38-39m). Financial and market conduct examination of acquired domestic insurance company. Transactions limited. Penalties. Regulations. Section 38a-141 is repealed. (P.A. 87-302, S. 1, 2; P.A. 90-243, S. 14; P.A. 92-112, S. 34, 35.)

Sec. 38a-142. Own risk and solvency assessments. Reports. Penalty. Exemptions. Confidentiality of documents, materials or other information. (a) As used in this section: (1) “Insurance group” means those insurers and affiliates included within an insurance holding company system,…

Sec. 38a-142a. Corporate governance annual disclosures. Confidentiality of documents, materials or other information. CGAD reviews. Penalty. (a) As used in this section: (1) “Board” means the board of directors of an insurer or insurance group; (2) “CGAD” or “corporate governance…

Secs. 38a-143 to 38a-145. Reserved for future use. PART VI MONOPOLIES. SALE OR EXCHANGE OF STOCK.MERGERS. CONVERSIONS. REORGANIZATIONS

Sec. 38a-146. (Formerly Sec. 38-37). Domestic insurance company may acquire stock of other companies. Any domestic insurance company may retain or acquire the whole or any part of the stock or other share capital of other insurance corporations, provided no insurance corporation …

Sec. 38a-147. (Formerly Sec. 38-37a). Solicitation of proxies. (a) No person shall, in contravention of such regulations as the Insurance Commissioner may prescribe as necessary or appropriate in the public interest or for the protection of investors, solicit or permit the use of…

Sec. 38a-148. (Formerly Sec. 38-37b). Redemption of shares of domestic insurance company. Notice. Determination of fair value. (a) Any stock of a domestic insurance corporation licensed to conduct an insurance business in this state may be made subject to redemption by that corpo…

Sec. 38a-149. (Formerly Sec. 38-38). Interlocking directorate. Any person may be a director in two or more insurance corporations when such interlocking directorate is not used as a means of substantially lessening competition or tending to create a monopoly. (1949 Rev., S. 6094.…

Sec. 38a-150. (Formerly Sec. 38-39). Monopoly. Complaint and hearing. Cease and desist order. (a) Whenever the commissioner has reason to believe that there is a violation of section 38a-146 or 38a-149, he shall serve upon the insurance corporation or director concerned a complai…

Sec. 38a-151. (Formerly Sec. 38-34). Reduction of capital stock. Any insurance company, with the consent of the commissioner, may reduce its capital stock to such extent, and change the par value of its shares to such amount, as is approved by at least two-thirds of its board of …

Sec. 38a-152. (Formerly Sec. 38-35). Issuance of stock in exchange for stock of another company. (a) Any domestic insurance company with capital stock may, with the prior approval of the commissioner, issue its capital stock within the limit of its authorized capital in exchange …

Sec. 38a-153. (Formerly Sec. 38-42). Merger or consolidation of companies. (a) Any domestic insurance company may, with the prior approval of the commissioner, merge or consolidate with one or more other domestic insurance companies or with one or more foreign or alien insurance …

Sec. 38a-154. (Formerly Sec. 38-36). Filing of the certificate of merger or consolidation with the Secretary of the State. If the commissioner approves and authorizes the proposed merger or consolidation or issuance and exchange of stock, such merger or consolidation or issuance …

Sec. 38a-155. (Formerly Sec. 38-42b). Conversion of hospital service corporation and medical service corporation to mutual insurance company. Procedure. Authorized agents to sell products. (a) Any consolidated hospital service corporation and medical service corporation organized…

Sec. 38a-156. Definitions. As used in this section and sections 38a-156a to 38a-156m, inclusive: (1) “Adoption date” means the date a mutual insurer's board of directors adopts a plan of reorganization; (2) “Commissioner” means the Insurance Commissioner; (3) “Converted company” …

Sec. 38a-156a. Reorganization of domestic mutual insurer as domestic stock insurer owned by mutual holding company. Plan of reorganization. Approval. Use of the word “mutual” in name. Voting stock ownership. Prohibited fees, commission or other consideration. (a) A domestic mutua…

Sec. 38a-156b. Mutual holding company requirements. (a) No mutual holding company shall engage in the business of insurance. (b) A mutual holding company shall comply with all applicable provisions of law relating to the powers, duties and liabilities of corporations. (c) A mutua…