South Carolina § 38-12-60 - Prohibited actions of insurer.

§ 38-12-60. Prohibited actions of insurer.

(A) An insurer, directly or indirectly, may not:

(1) invest in an obligation or security or make a guarantee for the benefit of or in favor of an officer or director of the insurer, except as provided in Section 38-12-70;

(2) invest in an obligation or security, make a guarantee for the benefit of or in favor of, or make other investments in a business entity of which ten percent or more of the voting securities or equity interests are owned directly or indirectly by or for the benefit of one or more officers or directors of the insurer, except as authorized in Chapter 21 of this title or as provided in Section 38-12-70;

(3) engage on its own behalf or through one or more affiliates in a transaction or series of transactions designed to evade the prohibitions of this chapter;

(4) invest in a partnership as a general partner, except that an insurer may make an investment as a general partner:

(a) if all other partners in the partnership are subsidiaries or other insurance company affiliates of the insurer;

(b) for the purpose of:

(i) meeting cash calls committed to before the effective date of this chapter;

(ii) completing those specific projects or activities of the partnership in which the insurer was a general partner as of the effective date of this chapter that had been undertaken as of that date; or

(iii) making capital improvements to property owned by the partnership on the effective date of this chapter if the insurer was a general partner as of that date; or

(c) in accordance with Section 38-12-40(C); or

(5) invest in or lend its funds upon the security of shares of its own stock, except as authorized by other provisions of this title, except that those shares must not be admitted assets of the insurer.

(B) This section does not prohibit a subsidiary or other affiliate of the insurer from becoming a general partner.

HISTORY: 2002 Act No. 319, SECTION 2, eff June 3, 2002.