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Official Code of Georgia Annotated

Title 33. INSURANCE · Chapter 11. INVESTMENTS · Article 2. INVESTMENTS OF LIFE, ACCIDENT AND SICKNESS, PROPERTY, AND CASUALTY INSURERS

33-11-53. Factors to be considered in determining prudence.

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Current through: Including Acts of the 2025 Regular Session of the General Assembly.

  1. The following factors shall be evaluated by the insurer and considered along with its business in determining whether an investment portfolio or investment policy is prudent, and the Commissioner shall consider the following factors prior to making a determination that an insurer’s investment portfolio or investment policy is not prudent:

  2. (1)

    General economic conditions;#

  3. (2)

    The possible effect of inflation or deflation;#

  4. (3)

    The expected tax consequences of investment decisions or strategies;#

  5. (4)

    The fairness and reasonableness of the terms of an investment considering its probable risk and reward characteristics and relationship to the investment portfolio as a whole;#

  6. (5)

    The extent of the diversification of the insurer’s investments among:#

    1. (A)

      Individual investments;#

    2. (B)

      Classes of investments;#

    3. (C)

      Industry concentrations;#

    4. (D)

      Dates of maturity; and#

    5. (E)

      Geographic areas;#

  7. (6)

    The quality and liquidity of investments in affiliates;#

  8. (7)

    The investment exposure to the following risks, quantified in a manner consistent with the insurer’s acceptable risk level appropriate for the insurer given the level of capitalization and expertise available to the insurer:#

    1. (A)

      Liquidity;#

    2. (B)

      Credit and default;#

    3. (C)

      Systemic (market);#

    4. (D)

      Interest rate;#

    5. (E)

      Call, prepayment, and extension;#

    6. (F)

      Currency; and#

    7. (G)

      Foreign sovereign, political subdivision, and corporate;#

  9. (8)

    The amount of the insurer’s assets, capital and surplus, premium writings, insurance in force, and other appropriate characteristics;#

  10. (9)

    The amount and adequacy of the insurer’s reported liabilities;#

  11. (10)

    The relationship of the expected cash flows of the insurer’s assets and liabilities and the risk of adverse changes in the insurer’s assets and liabilities;#

  12. (11)

    The adequacy of the insurer’s capital and surplus to secure the risks and liabilities of the insurer; and#

  13. (12)

    Any other factors appropriate for consideration and relevant to whether an investment is prudent.#

The notes below are printed with the section but are not enacted law (O.C.G.A. § 1-1-1(c)). They are shown apart from the text.

History

Code 1981, § 33-11-53, enacted by Ga. L. 1999, p. 592, § 12.

Code Commission notes

Pursuant to Code Section 28-9-5, in 1999, a comma was inserted following ‘‘prepayment’’ in subparagraph (7)(E) and a comma was deleted following ‘‘liabilities’’ in paragraph (10).

Read the official page (the state's PDF, opened at the page this text was read from).

Current through: Including Acts of the 2025 Regular Session of the General Assembly.

Text read from t33-ch1-22-(v24)-2020-pdf.pdf, Volume V24, 2020 edition, pages 547 to 549; merge action: carried; file SHA-256 4ecec175d949.