Oklahoma 2022 Regular Session

Oklahoma House Bill HB2809 Compare Versions

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Version 2 (New)

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3		-	ENGR. S. A. TO ENGR. H. B. NO. 2809 Page 1 1
	3	+	SENATE FLOOR VERSION - HB2809 SFLR Page 1
	4	+	(Bold face denotes Committee Amendments) 1
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28		-	ENGROSSED SENATE AMENDMENT
29		-	TO
	29	+	SENATE FLOOR VERSION
	30	+	March 29, 2021
	31	+	AS AMENDED
	32	+
30	33		ENGROSSED HOUSE
31	34		BILL NO. 2809 By: Sneed of the House
32	35
33	36		and
34	37
35	38		Quinn of the Senate
36		-
37	39
38	40
39	41
40	42
41	43		An Act relating to insurance; amending 36 O.S. 2011,
42	44		Section 1622, as amended by Section 3, Chapter 287,
43	45		O.S.L. 2017 (36 O.S. Supp. 2020, Section 1622), which
44	46		relates to mortgage on real estate; modifying
45	47		percentages of company's admitted assets that may be
46	48		invested in certain mortgage loans, money mortgages
47	49		and real property; providing exception; calculating
48	50		portfolio average loan to value; amending 36 O.S.
49	51		2011, Section 1624, as amended by Section 4, Chapter
50	52		287, O.S.L. 2017 (36 O.S. Supp. 2020, Section 1624),
51	53		which relates to acquiring or holding real property;
52	54		modifying percentage of company's admitted assets
53		-	that may be invested in real property; and ~~providing~~
54		-	an ~~effective date~~.
	55	+	that may be invested in real property; and declaring
	56	+	an emergency.
55	57
56	58
57	59
58		-	AMENDMENT NO. 1. Page 7, line 23, delete Section 3, the effective
59		-	date, and insert a new Section 3, as emergency
60		-	provision
61	60
62		-	and amend the title to conform
	61	+	BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
	62	+	SECTION 1. AMENDATORY 36 O.S. 2011, Section 1622, as
	63	+	amended by Section 3, Chapter 287, O.S.L. 2017 (36 O.S. Supp. 2020,
	64	+	Section 1622), is amended to rea d as follows:
	65	+	Section 1622. A. An insurer may invest any of its funds in
	66	+	bonds, notes or other evidences of indebtedness which are secured by
	67	+	first mortgages or deeds of trust upon improved, unencumbe red real
	68	+	property located in the United States, or whi ch are secured by first
63	69
64		-	ENGR. S. A. TO ENGR. H. B. NO. 2809 Page 2 1
	70	+	SENATE FLOOR VERSION - HB2809 SFLR Page 2
	71	+	(Bold face denotes Committee Amendments) 1
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89		-	Passed the Senate the 20th day of April, 2021.
	96	+	mortgages or deeds of trust upon leasehold estates having an expired
	97	+	term of not less than twenty -one (21) years, inclusive of the term
	98	+	which may be provided by an enforceable op tion of renewal, in
	99	+	improved, unencumbered real proper ty located in the United States.
	100	+	B. Real property shall not be deemed to be encumbered within
	101	+	the meaning of this section by reason of the existence of
	102	+	instruments reserving mineral, oil or timber righ ts, rights-of-way,
	103	+	sewer rights, rights in walls, nor by reason of any liens for taxes
	104	+	or assessments not delinquent, nor by reason of building
	105	+	restrictions or other restrictive covenants, nor when such real
	106	+	property is subject to lease under which rents o r profits are
	107	+	reserved to the owner, if in any event t he security for such loan
	108	+	is a first lien upon such real property and if there is no
	109	+	condition or right of reentry or forfeiture under which, in the
	110	+	case of real property other than leaseholds, such lie n can be cut
	111	+	off, subordinated, or otherwise disturbed or under which, in the
	112	+	case of leaseholds, the insurer is unable to continue the lease in
	113	+	force for the duration of the loan.
	114	+	C. No such mortgage loan or loans made or acquired by an
	115	+	insurer on any one property shall, at the time of investment by the
	116	+	insurer, exceed eighty percent (80%) of the value, or if the loan
	117	+	is for purchase money, the lesser of eighty percent (80%) of the
	118	+	value or purchase price of the real property or leasehold securing
	119	+	the same, except that such loan or loans may equal the amount of
90	120
91		-
92		-
93		-	Presiding Officer of the Senate
94		-
95		-
96		-	Passed the House of Representatives the ____ day of __________,
97		-	2021.
98		-
99		-
100		-
101		-	Presiding Officer of the House
102		-	of Representatives
103		-
104		-	ENGR. H. B. NO. 2809 Page 1 1
	121	+	SENATE FLOOR VERSION - HB2809 SFLR Page 3
	122	+	(Bold face denotes Committee Amendments) 1
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129		-	ENGROSSED HOUSE
130		-	BILL NO. 2809 By: Sneed of the House
	147	+	any guaranty by the United States of America or by any agency or
	148	+	instrumentality of the United States of America or by any private
	149	+	insurance company licensed as an authorized insurer by the
	150	+	Insurance Department of the State of Oklahoma to write mortgag e
	151	+	insurance. Additionally, no single mortgage loan to any individual
	152	+	shall exceed four percent (4%) three percent (3%) of the company's
	153	+	admitted assets, with no more than thirty -five percent (35%) of t he
	154	+	company's admitted assets invested in total aggrega te amount in
	155	+	mortgage loans. However, an insurer may invest up to forty -five
	156	+	percent (45%) of its admitted assets invested in total aggregate
	157	+	amount in mortgage loans if the portfolio average loan to v alue is
	158	+	seventy-five percent (75%) or less of fair mar ket value.
	159	+	The calculation of admitted assets and portfolio average loan
	160	+	to value is based on the insurer's annual statement as of December
	161	+	31 last preceding the date of investment, or as shown by a cur rent
	162	+	financial statement on file with the Commissioner .
	163	+	Mortgage loans made or acquired by an insurer prior to December
	164	+	31, 1992, shall be in compliance with the limitation provided in
	165	+	this subsection for total aggregate investment of admitted assets
	166	+	in mortgage loans by December 31, 1997. Mortgage loans mad e or
	167	+	acquired by an insurer on or after December 31, 1992, but prior to
	168	+	September 1, 1993, shall be in compliance with the limitations for
	169	+	investment of admitted assets in single mortgage loans to
	170	+	individuals and total aggregate investments of admitted ass ets in
131	171
132		-	and
133		-
134		-	Quinn of the Senate
135		-
136		-
137		-
138		-
139		-	An Act relating to insurance; amending 36 O.S. 2011,
140		-	Section 1622, as amended by Section 3, Chapter 287,
141		-	O.S.L. 2017 (36 O.S. Supp. 2020, Section 1622), which
142		-	relates to mortgage on real estate; modifying
143		-	percentages of company's admitted assets that may be
144		-	invested in certain mortgage loans, money mortgages
145		-	and real property; providing exception; calculating
146		-	portfolio average loan to value; amending 36 O.S.
147		-	2011, Section 1624, as amended by Section 4, Chapter
148		-	287, O.S.L. 2017 (36 O.S. Supp. 2020, Section 1624 ),
149		-	which relates to acquiring or holding real property;
150		-	modifying percentage of company's admitted assets
151		-	that may be invested in real property; and providing
152		-	an effective date.
153		-
154		-
155		-
156		-
157		-
158		-
159		-	BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
160		-	SECTION 1. AMENDATORY 36 O.S. 2011, Section 1622, as
161		-	amended by Section 3, Chapter 287, O.S.L. 2017 (36 O.S. Supp. 2020,
162		-	Section 1622), is amended to read as follows:
163		-	Section 1622. A. An insurer may invest any of its funds in
164		-	bonds, notes or othe r evidences of indebtedness which are secured by
165		-	first mortgages or deeds of trust upon improved, unencumbered real
166		-	property located in the United States, or which are secured by first
167		-	mortgages or deeds of trust upon leasehold estates having an expired
168		-
169		-	ENGR. H. B. NO. 2809 Page 2 1
	172	+	SENATE FLOOR VERSION - HB2809 SFLR Page 4
	173	+	(Bold face denotes Committee Amendments) 1
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194		-	term of not less than twenty -one (21) years, inclusive of the term
195		-	which may be provided by an enforceable option of renewal, in
196		-	improved, unencumbered real property located in the United States.
197		-	B. Real property shall not be deemed to be encumbered within
198		-	the meaning of this section by reason of the existence of
199		-	instruments reserving mineral, oil or timber rights, rights -of-way,
200		-	sewer rights, rights in walls, nor by reason of any liens for taxes
201		-	or assessments not delinquent, nor by reason of building
202		-	restrictions or other restrictive covenants, nor when such real
203		-	property is subject to lease under which rents or profits are
204		-	reserved to the owner, if in any event the security for such loan
205		-	is a first lien upon such real property and if there is no
206		-	condition or right of reentry or forfeiture under which, in the
207		-	case of real property other than leaseholds, such lien can be cut
208		-	off, subordinated, or otherwise disturbed or under which, in the
209		-	case of leaseholds, the insurer is unable to continue the lease in
210		-	force for the duration of the loan.
211		-	C. No such mortgage loan or loans made or acquired by an
212		-	insurer on any one property shall, at the time of investment by the
213		-	insurer, exceed eighty percent (80%) of the value, or if the loan
214		-	is for purchase money, the lesse r of eighty percent (80%) of the
215		-	value or purchase price of the real property or leasehold securing
216		-	the same, except that such loan or loans may equal the amount of
217		-	any guaranty by the United States of America or by any agency or
218		-
219		-	ENGR. H. B. NO. 2809 Page 3 1
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244		-	instrumentality of the Uni ted States of America or by any private
245		-	insurance company licensed as an authorized insurer by the
246		-	Insurance Department of the State of Oklahoma to write mortgage
247		-	insurance. Additionally, no single mortgage loan to any individual
248		-	shall exceed four percent (4%) three percent (3%) of the company's
249		-	admitted assets, with no more than thirty -five percent (35%) of the
250		-	company's admitted assets invested in total aggregate amount in
251		-	mortgage loans. However, an insurer may invest up to forty -five
252		-	percent (45%) of its admitted assets invested in total aggregate
253		-	amount in mortgage loans if the portfolio average loan to value is
254		-	seventy-five percent (75%) or less of fair market value.
255		-	The calculation of admitted assets and portfolio average loan
256		-	to value is based on the insurer's annual statement as of December
257		-	31 last preceding the date of investment, or as shown by a current
258		-	financial statement on file with the Commissioner.
259		-	Mortgage loans made or acquired by an insurer prior to December
260		-	31, 1992, shall be in complia nce with the limitation provided in
261		-	this subsection for total aggregate investment of admitted assets
262		-	in mortgage loans by December 31, 1997. Mortgage loans made or
263		-	acquired by an insurer on or after December 31, 1992, but prior to
264		-	September 1, 1993, shal l be in compliance with the limitations for
265		-	investment of admitted assets in single mortgage loans to
266		-	individuals and total aggregate investments of admitted assets in
267	198		mortgage loans provided in this subsection by December 31, 1997.
268		-
269		-	ENGR. H. B. NO. 2809 Page 4 1
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294	199		Insurers shall maintain accurate and adequate records reflecting
295	200		the provisions of this section and submit such records with
296	201		quarterly and annual statements.
297	202		D. No such mortgage loan or loans shall be made or acquired by
298	203		an insurer except after an appraisal made by a qualified appraiser
299	204		for the purpose of such investment. No change or modification
300	205		shall be made to such appraisal b y any mortgage underwriter unless
301	206		such person is licen sed or certified as an appraiser pursuant to
302	207		the Oklahoma Certified Real Estate Appraisers Act or unless such
303	208		person has been provided by the person who made the appraisal
304	209		written consent to make the mo dification. Such modification shall
305	210		be disclosed to the seller and buyer and/or the seller's agent.
306	211		E. No such mortgage loan or loans made or acquired by an
307	212		insurer after July 1, 2006, shall be made or acquired by an insurer
308	213		unless the mortgages or mortg age loans are upon improved,
309	214		unencumbered real propert y permitted as an investment pursuant to
310	215		Section 1624 of this title.
311	216		F. No mortgage loan upon a leasehold shall be made or acquired
312	217		pursuant to this section unless the terms thereof shall provide for
313	218		amortization payments to be made by the borrower on the principal
314	219		thereof at least once in each year in amounts sufficient completely
315	220		to amortize the loan within a period of four -fifths (4/5) of the
316	221		term of the leasehold, inclusive of the term which may be provided
317	222
318		-	ENGR. H. B. NO. 2809 Page 5 1
	223	+	SENATE FLOOR VERSION - HB2809 SFLR Page 5
	224	+	(Bold face denotes Committee Amendments) 1
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343	249		by an enforceable option of renewal, which is unexpired at the time
344	250		the loan is made, but in no event exceeding thirty -five (35) years.
345	251		G. Subject to specific limitations otherwise applicable, no
346	252		more than an aggregate of thirty-five percent (35%) forty-five
347	253		percent (45%) of the company's admitted a ssets may be invested in
348	254		mortgage loans pursuant to this section, purchase money mortgages
349	255		pursuant to Section 1623 of this title, and real property pursuant
350	256		to Section 1624 of this title.
351	257		SECTION 2. AMENDATORY 36 O.S. 2011, Secti on 1624, as
352	258		amended by Section 4, Chapter 287, O.S.L. 2017 (36 O.S. Supp. 2020,
353	259		Section 1624), is amended to read as follows:
354	260		Section 1624. No insurance company, foreign, alien or domestic,
355	261		doing business in Oklahoma, may acquire or hold real property
356	262		therein, except as follows:
357	263		1. Such as shall be requisite for the convenient accommodation
358	264		of the transaction of its own business; the amount invested in such
359	265		real property shall not exceed ten percent (1 0%) of the investing
360	266		company's admitted assets but the Insurance Commissioner may grant
361	267		permission to the company to invest in real property for such
362	268		purpose in such increased amount as the Insurance Commissioner may
363	269		deem proper on the showing made, if upo n a hearing held the
364	270		Insurance Commissioner finds that the amount represented by such
365	271		percentage of its admitted assets is insufficient to provide
366	272		convenient accommodation for the company's business. Real estate
367	273
368		-	ENGR. H. B. NO. 2809 Page 6 1
	274	+	SENATE FLOOR VERSION - HB2809 SFLR Page 6
	275	+	(Bold face denotes Committee Amendments) 1
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393	300		maintained for the convenient accommodation of the transaction of
394	301		its own business, permitted to be carried as an admitted asset of
395	302		the company pursuant to this section shall be carried at an amount
396	303		equal to its cost at the time of acquisition together with the
397	304		actual cost of improvements made ther eon, less encumbrances and less
398	305		depreciation; provided , however, any real estate carried at fair
399	306		market value as an admitted asset of the company on the effective
400	307		date of this act shall be excluded from this provision;
401	308		2. Such as shall have been mortgaged to it in good faith by way
402	309		of security for loans prev iously contracted for monies due;
403	310		3. Such as shall have been conveyed to it in satisfaction of
404	311		debts previously contracted in course of its dealings;
405	312		4. Such as shall have been purchased at sales on j udgments,
406	313		decrees, or mortgages obtained or made for s uch debts;
407	314		5. Such real property as shall have been acquired in whole or
408	315		in part, in exchange for real property of approximately the same
409	316		value theretofore legally acquired and held by it;
410	317		6. Real property and improvements thereon located in
411	318		incorporated cities and towns and as additions thereto or real
412	319		property and improvements wherever located acquired for sale or
413	320		lease, if such lessee or purchaser could have legally acquired the
414	321		same in the first in stance, and may make improvements thereon for
415	322		commercial and industrial purposes as an investment for the
416	323		production of income. The phrase "commercial and industrial
417	324
418		-	ENGR. H. B. NO. 2809 Page 7 1
	325	+	SENATE FLOOR VERSION - HB2809 SFLR Page 7
	326	+	(Bold face denotes Committee Amendments) 1
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443	351		purposes" shall not include real property primarily intended for use
444	352		or valued as agricul tural, horticultural, farm, and ranch, unless
445	353		adjacent to other real property the ownership of which is permitted
446	354		under this section and was acquired prior to July 1, 2006. The
447	355		total amount invested in such real property and improvements thereon
448	356		shall not exceed the company's capital and/or surplus, or ten
449	357		percent (10%) of its admitted assets whichever is the lesser;
450	358		provided, however, the amount invested in any one investment shall
451	359		not exceed four percent (4%) of the company's admitted assets. The
452	360		admitted assets shall be determined by the company's last an nual
453	361		report made as of December 31, immediately preceding and which has
454	362		been filed with the Insurance Commissioner as required by law, or as
455	363		shown by a current financial statement on file with the
456	364		Commissioner;
457	365		7. Real property acquired and held under Sec tion 1612.1 of this
458	366		title; and
459	367		8. Subject to specific limitations otherwise applicable, no
460	368		more than an aggregate of thirty-five percent (35%) forty-five
461	369		percent (45%) of the company's admitted assets may be invested in
462	370		real property pursuant to this sect ion, purchase money mortgages
463	371		pursuant to Section 1623 of this title, and mortgage loans pursuant
464	372		to Section 1622 of this title.
465		-	SECTION 3. This act shall become effective November 1, 2021.
	373	+	SECTION 3. It being immediately necessary for the pr eservation
	374	+	of the public peace, health or safety, an emergency is hereby
466	375
467		-
468		-	~~ENGR. H.~~ ~~B. NO.~~ ~~2809 Page 8~~ 1
	376	+	SENATE FLOOR VERSION - HB2809 SFLR Page 8
	377	+	(Bold face denotes Committee Amendments) 1
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493		-	Passed the House of Representatives the 3rd day of March, 2021.
494		-
495		-
496		-
497		-
498		-	Presiding Officer of the House
499		-	of Representatives
500		-
501		-
502		-	Passed the Senate th e ___ day of __________, 2021.
503		-
504		-
505		-
506		-
507		-	Presiding Officer of the Senate
508		-
509		-
510		-
	402	+	declared to exist, by reason whereof this act shall take effect and
	403	+	be in full force from and after its passage and approval.
	404	+	COMMITTEE REPORT BY: COMMITTEE ON RETIREMENT AND INSURANCE
	405	+	March 29, 2021 - DO PASS AS AMENDED