New Jersey Statutes 17:24-1.2. Actions prohibited by insurer without prior approval; exceptions
Terms Used In New Jersey Statutes 17:24-1.2
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- person: includes corporations, companies, associations, societies, firms, partnerships and joint stock companies as well as individuals, unless restricted by the context to an individual as distinguished from a corporate entity or specifically restricted to one or some of the above enumerated synonyms and, when used to designate the owner of property which may be the subject of an offense, includes this State, the United States, any other State of the United States as defined infra and any foreign country or government lawfully owning or possessing property within this State. See New Jersey Statutes 1:1-2
- State: extends to and includes any State, territory or possession of the United States, the District of Columbia and the Canal Zone. See New Jersey Statutes 1:1-2
(a) make a loan to, or other investment in, an officer or director of the insurer or a person in which the officer or director has any direct or indirect financial interest;
(b) make a guarantee for the benefit of, or in favor of, an officer or director of the insurer or a person in which the officer or director has any direct or indirect financial interest; or
(c) enter into an agreement for the purchase or sale of property from or to an officer or director of the insurer or a person in which the officer or director has any direct or indirect financial interest.
(2) For purposes of this section, an officer or director shall not be deemed to have a financial interest by reason of an interest that is held directly or indirectly through the ownership of equity interests representing less than 5% of all outstanding equity interests issued by a person that is a party to the transaction, or solely by reason of that individual’s position as a director or officer of a person that is a party to the transaction.
(3) Nothing in this subsection shall permit an investment that is otherwise prohibited by law.
(4) This subsection shall not apply to a transaction between an insurer and any of its subsidiaries or affiliates entered into in compliance with section 4 of P.L.1970, c.22 (C. 17:27A-4) other than a transaction between an insurer and its officer or director.
b. An insurer may make, without the prior written approval of the commissioner:
(1) Advances to officers or directors for expenses reasonably expected to be incurred in the ordinary course of the insurer’s business or guarantees associated with credit or debit cards issued or credit extended for the purpose of financing these expenses;
(2) Loans secured by the principal residence of an existing or new officer of the insurer made in connection with the officer’s relocation at the insurer’s request, so long as the terms and conditions otherwise are the same as those generally available from unaffiliated third parties;
(3) Secured loans to an existing or new officer of the insurer made in connection with the officer’s relocation at the insurer’s request, if the loans:
(a) do not have a term exceeding two years;
(b) are required to finance mortgage loans outstanding at the same time on the prior and new residences of the officer;
(c) do not exceed an amount equal to the equity of the officer in the prior residence; and
(d) are required to be fully repaid within two years, or upon the sale of the prior residence whichever first occurs; and
(4) Loans and advances to officers or directors made in compliance with State or federal law specifically related to the loans and advances by a regulated non-insurance subsidiary or affiliate of the insurer in the ordinary course of business and on terms no more favorable than those available to other customers of the entity.
L.2007, c.252, s.3.