No. 28914: R590-178. Securities Custody

 

DAR File No.: 28914
Filed: 08/07/2006, 01:32
Received by: NL

 

NOTICE OF REVIEW AND STATEMENT OF CONTINUATION

Concise explanation of the particular statutory provisions under which the rule is enacted and how these provisions authorize or require the rule:

Subsection 31A-2-201(3) gives the commissioner the authority to make rules to implement the provisions of Title 31A. Section 31A-2-206 gives the commissioner the authority to write rules regarding the receipt and handling of deposited securities. Section 31A-4-108 allows the commissioner to write rules to safeguard securities and ensure that they are not loaned to other insurers. Section R590-178-4 sets standards, guidelines, and forms to be used when an insurer transfers their securities to a custodian for.

 

Summary of written comments received during and since the last five-year review of the rule from interested persons supporting or opposing the rule:

The department is now in the process of making changes to this rule to make it conform with conditions and procedures in holding and transferring of securities. The department has received comments that has helped us understand the Federal Reserve book-entry system that we are making a part of the rule. No other comments have been received

 

Reasoned justification for continuation of the rule, including reasons why the agency disagrees with comments in opposition to the rule, if any:

The rule provides requirements for custodians to follow to protect the invested assets of the company. Without it, insurers could place their investments under risky custodial arrangements, or situations in which one is not provided that defines the responsibilities of the custodian. Therefore, this rule should be continued.

 

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Administration
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY UT 84114-1201

 

Direct questions regarding this rule to:

Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at [e-mail]

 

Authorized by:

Jilene Whitby, Information Specialist