PRINTER'S NO. 217
No. 188 Session of 2003
INTRODUCED BY GODSHALL, HENNESSEY, SCAVELLO, TANGRETTI AND YOUNGBLOOD, FEBRUARY 11, 2003
REFERRED TO COMMITTEE ON INSURANCE, FEBRUARY 11, 2003
AN ACT 1 Amending the act of May 17, 1921 (P.L.682, No.284), entitled "An 2 act relating to insurance; amending, revising, and 3 consolidating the law providing for the incorporation of 4 insurance companies, and the regulation, supervision, and 5 protection of home and foreign insurance companies, Lloyds 6 associations, reciprocal and inter-insurance exchanges, and 7 fire insurance rating bureaus, and the regulation and 8 supervision of insurance carried by such companies, 9 associations, and exchanges, including insurance carried by 10 the State Workmen's Insurance Fund; providing penalties; and 11 repealing existing laws," further providing for general 12 investment provisions and restrictions. 13 The General Assembly of the Commonwealth of Pennsylvania 14 hereby enacts as follows: 15 Section 1. Section 406.1 of the act of May 17, 1921 16 (P.L.682, No.284), known as The Insurance Company Law of 1921, 17 is amended by adding a subsection to read: 18 Section 406.1. General Investment Provisions and 19 Restrictions.--Investment under authority of section 404.2 and 20 holding of real estate under authority of section four hundred 21 six by any life insurance company, organized under the laws of 22 this Commonwealth, shall be subject to the following provisions:
1 * * * 2 (t) Real estate occupied by the company and real estate held 3 for the production of income shall be carried at depreciated 4 cost less encumbrances unless events or circumstances indicate 5 the carrying amount of the asset may not be recoverable. If the 6 fair market value of the asset is less than the carrying value, 7 the asset shall be written down to the fair market value thereby 8 establishing a new cost basis. The current fair market value of 9 real estate shall be determined on a property-by-property basis, 10 and shall be defined as the price that the real estate would 11 bring in a competitive and open market under all conditions 12 requisite to a fair sale. The fair market value of the real 13 estate shall be determined not less than triennially by 14 obtaining an appraisal prepared by a State-certified real estate 15 appraiser. 16 Section 2. This act shall take effect in 60 days. A2L40SFL/20030H0188B0217 - 2 -