BILL NUMBER: SB 1088	CHAPTERED  08/30/04

	CHAPTER  381
	FILED WITH SECRETARY OF STATE  AUGUST 30, 2004
	APPROVED BY GOVERNOR  AUGUST 27, 2004
	PASSED THE ASSEMBLY  AUGUST 12, 2004
	PASSED THE SENATE  MAY 17, 2004

INTRODUCED BY   Senator Scott

                        JANUARY 6, 2004

   An act to amend Section 11521.2 of the Insurance Code, relating to
grants and annuities societies.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1088, Scott.  Grants and annuities societies:  investments.
   Existing law allows grants and annuities societies to receive
transfers of property, conditioned upon their agreement to pay an
annuity to the transferor or the transferor's nominee, after
obtaining a certificate of authority from the Insurance Commissioner.
  Existing law provides that the reserve required for each annuity
contract issued by a grants and annuities society must be invested in
certain investments, except that a society may invest in securities
listed and traded on specified exchanges to the extent of the lesser
of the society's net worth or 10% of its general investments.
   This bill would allow a grants and annuities society to invest in
these securities to the extent of the lesser of its net worth or 50%
of its general investments.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 11521.2 of the Insurance Code is amended to
read:
   11521.2.  (a) The reserve required by the table of commensurate
values for each annuity contract issued must be invested in
investments specified in Sections 1170 through 1182 except that a
certificate holder may invest in securities listed and traded on the
New York Stock Exchange, the American Stock Exchange or regional
stock exchanges or the National Market System of the Nasdaq Stock
Market or successors to such exchanges or market having the same
qualifications, to the extent of the lesser of net worth (assets over
liabilities and reserves) of the certificate holder or  50 percent
of these general investments.  This section does not permit
investment in options or commodity exchanges.
   (b) The certificate holder may invest in other investments as
permitted by and subject to the written consent of the commissioner.