38.2-1416 - Canadian governmental obligations. - Virginia Statutes

§ 38.2-1416. Canadian governmental obligations.

A. Obligations of Canada. - A domestic insurer may invest in bonds, notes,warrants, and other evidences of indebtedness which are direct obligations ofthe government of Canada or for which the full faith and credit of thegovernment of Canada are pledged for the payment of principal and interest.

B. No domestic insurer shall invest in any obligation under this sectionunless the obligation is payable both as to principal and interest in lawfulmoney of the United States or of Canada.

C. Obligations of provinces. - A domestic insurer may invest in direct,general obligations of any province of Canada for the payment of money, orobligations for the payment of money to the extent guaranteed or insured asto the payment of principal and interest by any province of Canada, on thefollowing conditions:

1. The province has the power to levy taxes for the prompt payment of theprincipal and interest of its obligations;

2. The province is not in default in the payment of principal or interest onany of its direct, guaranteed or insured obligations as of the date ofinvestment; and

3. An insurer shall not invest under this subsection more than five percentof its admitted assets in obligations issued or guaranteed by any oneprovince.

D. Local government obligations. - A domestic insurer may invest in direct,general obligations of any political subdivision of any province of Canadafor the payment of money, or obligation for the payment of money, to theextent guaranteed as to the payment of principal and interest, by any suchpolitical subdivision, on the following conditions:

1. The obligations are payable or guaranteed from ad valorem taxes;

2. Such political subdivision is not in default in the payment of principalor interest on any of its direct or guaranteed obligations;

3. No investment shall be made under this subsection in obligations which aresecured only by special assessments for local improvements; and

4. An insurer shall not invest more than two percent of its admitted assetsin obligations issued or guaranteed by any one such political subdivision.

(1983, c. 457, § 38.1-217.19; 1986, c. 562; 1992, c. 588.)