(a)

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Terms Used In Tennessee Code 56-3-903

  • Clearing corporation: means :
    (i) A corporation as defined in §. See Tennessee Code 56-3-902
  • Commissioner: means the commissioner of commerce and insurance. See Tennessee Code 56-3-902
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Custodian: means a national bank, state bank, federal home loan bank, trust company or broker/dealer that participates in a clearing corporation. See Tennessee Code 56-3-902
  • Person: means any association, aggregate of individuals, business, company, corporation, individual, joint-stock company, Lloyds-type organization, organization, partnership, receiver, reciprocal or interinsurance exchange, trustee or society. See Tennessee Code 56-16-102
  • Securities: means instruments as defined in §. See Tennessee Code 56-3-902
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
(1) A domestic insurance company may deposit, or arrange for the deposit of, securities held in or purchased for its general account and its separate accounts in a clearing corporation.
(2) When securities are deposited with a clearing corporation:

(A) Certificates representing securities of the same class of the same issuer may be merged and held in bulk in the name of the nominee of such clearing corporation with any other securities deposited with such clearing corporation by any person, regardless of the ownership of such securities; and
(B) Certificates representing securities of small denominations may be merged into one (1) or more certificates of larger denominations.
(3) The records of any custodian through which an insurance company holds securities in a clearing corporation shall at all times show that such securities are held for such insurance company and for which accounts.
(4) Ownership of, and other interest in, such securities may be transferred by bookkeeping entry on the books of such clearing corporation without physical delivery of certificates representing such securities.
(b) The commissioner is authorized to promulgate rules and regulations governing the deposit by insurance companies of securities with clearing corporations, including establishing standards for national banks, state banks, federal home loan banks, trust companies and broker/dealers to qualify as custodians for insurance company securities.
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