Title 5. Assets, Liabilities, Reserves, and Investments of Insurers — Subtitle 1. Assets and Liabilities

cash that the insurer holds or that it controls while the cash is in transit, and the true balance of any deposit in a solvent bank or trust company;

shares or deposits in a savings and loan association or building and loan association, to the extent that the investment or account is insured by an instrumentality of the United States or of Canada;

in an amount not exceeding the cash surrender value of each individual policy:

in an amount not exceeding the policy reserve on each individual policy:

for a life insurer:

except for life insurance premiums, the amount of premiums in the course of collection that:

to the extent of the unearned premium reserves carried on policies:

the full amount of reinsurance that a ceding insurer may recover from a solvent reinsurer under Subtitle 9 of this title;

amounts receivable by an assuming insurer that represent funds that a solvent ceding insurer withholds under a reinsurance treaty;

deposits or equities recoverable from an underwriting association, syndicate, reinsurance fund, or suspended banking institution:

electronic data processing equipment and operating system software amortized over a period of not more than 3 calendar years, to the extent it does not exceed 3% of the insurer’s capital and surplus as required to be shown on the insurer’s statutory financial statement, adjusted to exclude deferred tax assets and net positive goodwill;

investments, securities, properties, and loans acquired or held in accordance with this article, and the related items listed in subsection (b) of this section;

positive goodwill recorded under the statutory purchase method of accounting:

other assets that an insurer may list as admitted assets in the annual statement required under this article, unless specifically not admitted under § 5–102 of this subtitle; and

at values determined by the Commissioner, other assets:

if it is not more than 90 days past due:

interest that is due or accrued on a collateral loan:

if the interest in its entirety is less than 180 days past due and has not accrued for more than 18 months, interest that is due or accrued on a mortgage loan, in an amount not more than any amount by which the value of the property, reduced by the amount of delinquent taxes and other costs to obtain and sell the property, exceeds the unpaid principal;

rent that is due or accrued on real property if:

for a title insurer, title plants as provided in § 5-104 of this subtitle.

organizational expenses, trade names, and other similar intangible assets;

except for policy loans, a secured or unsecured advance to an officer of the insurer;

an advance given only on personal security to an employee or insurance producer of the insurer or to another person;

stock of the insurer owned by it, any material interest in the stock of the insurer, any loan that is secured by the stock of the insurer, or any material proportionate interest in the stock of the insurer acquired or held through the insurer’s ownership of an interest in another firm, corporation, or business unit;

except for electronic data processing equipment and operating system software allowed as admitted assets under § 5-101(a)(11) of this subtitle, fixtures, furniture, furnishings, libraries, safes, stationery, supplies, and vehicles; and

the amount, if any, by which the aggregate book value of investments carried in the ledger assets of the insurer exceeds the amount deemed collectible or the aggregate value of those investments as determined under this article.

is approved and ratified by the board of directors of the insurer;

is secured by a first mortgage on a principal residence of an officer or employee; and

does not exceed the amount allowed for any other mortgage investment under § 5-511(g) of this title.

all of the insurer’s reported or unreported losses and claims incurred on or before the date of the annual statement required under this article; and

the expenses of adjustment or settlement of those losses and claims;

reserves on life insurance policies and annuity contracts in force, valued according to the tables of mortality, rates of interest, and applicable methods adopted under this article;

reserves for disability benefits for active and disabled lives;

reserves for accidental death benefits;

reserves for additional benefits that provide long-term home health care and long-term care in a nursing home or other related institution; and

any additional reserves that the Commissioner reasonably requires; and

In this section the following words have the meanings indicated.

“Backplant” means a title plant that antedates the period of time covered by an existing title plant, or that covers additional parcels of land.

“Title plant” means an integrated and indexed collection of title records consisting of documents, maps, surveys, or entries affecting title to real property or any interest in or encumbrance on the property which has been filed or recorded in the jurisdiction for which the title plant is established or maintained, as well as copies of prior title insurance policies.

The costs specified in this subsection shall be capitalized costs with reference to the valuation of a title plant.

Until a title plant can be used by an insurer to conduct title searches and issue title insurance policies, the costs incurred to construct a title plant, including the costs incurred to obtain, organize, and summarize historical information in an efficient and useful manner shall be capitalized costs. The capitalized costs must be directly related to, and properly identified with, the activities necessary to construct the title plant.

The costs to purchase or construct a backplant may be capitalized if the costs are properly identifiable.

The costs specified in this subsection may not be capitalized costs with reference to the valuation of a title plant.

Costs incurred after a title plant is operational to:

costs incurred to maintain a title plant; and

costs incurred to perform title searches.

20% of the admitted assets; or

40% of the surplus as regards policyholders.

a title plant and relinquish all rights to future use of the title plant;

an undivided ownership interest in its title plants; and

a copy of a title plant or the right to use a title plant.

enter into an agreement with one or more other title insurers authorized to do business in the State for the purpose of jointly participating in the ownership, management, and control of a title plant so as to serve the needs of the insurers; or

hold stock in a corporation that owns and operates a title plant for the purpose of participating in the ownership, management, and control of a title plant.