Okla. Stat. tit. 36, § 36-1632

investments.

A. A domestic insurer, either by itself or in cooperation with

one or more persons, may organize or acquire one or more

subsidiaries. The subsidiaries may conduct any kind of business or

businesses and their authority to do so shall not be limited by

reason of the fact that they are subsidiaries of a domestic insurer.

B. In addition to investments in common stock, preferred stock,

debt obligations and other securities permitted under all other

sections of Title 36 of the Oklahoma Statutes, a domestic insurer

may also:

1. Invest in common stock, preferred stock, debt obligations

and other securities of one or more subsidiaries, amounts which do

not exceed the lesser of ten percent (10%) of the insurer's assets

or fifty percent (50%) of the insurer's surplus as regards

policyholders, provided that after such investments the insurer's

surplus as regards policyholders will be reasonable in relation to

the insurer's outstanding liabilities and adequate to meet its

financial needs. In calculating the amount of such investments,

investments in domestic or foreign insurance subsidiaries and any

Oklahoma Statutes - Title 36. Insurance Page 452

other entity which provides or arranges for the financing or

provision of health care services or coverage over which the

Commissioner possesses financial solvency and regulatory oversight

authority shall be excluded, and there shall be included:

a. total net monies or other consideration expended and

obligations assumed in the acquisition or formation of

a subsidiary, including all organizational expenses

and contributions to capital and surplus of the

subsidiary whether or not represented by the purchase

of capital stock or issuance of other securities, and

b. all amounts expended in acquiring additional common

stock, preferred stock, debt obligations and other

securities, and all contributions to the capital or

surplus of a subsidiary subsequent to its acquisition

or formation;

2. Invest any amount in common stock, preferred stock, debt

obligations and other securities of one or more subsidiaries engaged

or organized to engage exclusively in the ownership and management

of assets authorized as investments for the insurer provided that

each subsidiary agrees to limit its investments in any asset so that

such investments will not cause the amount of the total investment

of the insurer to exceed any of the investment limitations specified

in paragraph 1 of this subsection or in Sections 1601 through 1629

of Title 36 of the Oklahoma Statutes applicable to the insurer. For

the purpose of this paragraph, "the total investment of the insurer"

shall include:

a. any direct investment by the insurer in an asset, and

b. the insurer's proportionate share of any investment in

an asset by any subsidiary of the insurer, which shall

be calculated by multiplying the amount of the

subsidiary's investment by the percentage of the

ownership of the subsidiary; and

3. With the approval of the Commissioner, invest any greater

amount in common stock, preferred stock, debt obligations or other

securities of one or more subsidiaries, provided that after the

investment the insurer's surplus as regards policyholders will be

reasonable in relation to the insurer's outstanding liabilities and

adequate to its financial needs.

C. Investments in common stock, preferred stock, debt

obligations or other securities of subsidiaries made pursuant to

subsection B of this section shall not be subject to any of the

otherwise applicable restrictions or prohibitions contained in Title

36 of the Oklahoma Statutes applicable to such investments of

insurers.

D. Whether any investment made pursuant to subsection B of this

section meets the requirements of that subsection is to be

determined before the investment is made, by calculating the

Oklahoma Statutes - Title 36. Insurance Page 453

applicable investment limitations as though the investment had
itions contained in Title

36 of the Oklahoma Statutes applicable to such investments of

insurers.

D. Whether any investment made pursuant to subsection B of this

section meets the requirements of that subsection is to be

determined before the investment is made, by calculating the

Oklahoma Statutes - Title 36. Insurance Page 453

applicable investment limitations as though the investment had

already been made, taking into account the then outstanding

principal balance on all previous investments in debt obligations,

and the value of all previous investments in equity securities as of

the day they were made, net of any return of capital invested, not

including dividends.

E. If an insurer ceases to control a subsidiary, it shall

dispose of any investment therein made pursuant to this section

within three (3) years from the time of the cessation of control or

within such further time as the Commissioner may prescribe, unless

at any time after the investment shall have been made, the

investment shall have met the requirements for investment under any

other section of Title 36 of the Oklahoma Statutes, and the insurer

notifies the Commissioner.