S T A T E   O F   N E W   Y O R K
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                                  6748

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                             March 28, 2011
                               ___________

Introduced  by M. of A. MORELLE -- read once and referred to the Commit-
  tee on Insurance

AN ACT to amend the insurance law, in relation to authorizing the  issu-
  ance of certain annuity contracts

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subparagraph (H)  of  paragraph  1  of  subsection  (b)  of
section  4223  of the insurance law is relettered subparagraph (I) and a
new subparagraph (H) is added to read as follows:
  (H) GROUP OR INDIVIDUAL ANNUITY CONTRACT OR CERTIFICATE AUTHORIZED  BY
SUBSECTION  (G) OF SECTION FOUR THOUSAND TWO HUNDRED FORTY OF THIS ARTI-
CLE.
  S 2. Section 4240 of the insurance law is  amended  by  adding  a  new
subsection (g) to read as follows:
  (G)  A DOMESTIC OR AUTHORIZED LIFE INSURER MAY ISSUE GROUP OR INDIVID-
UAL ANNUITY CONTRACTS AND CERTIFICATES THAT PROVIDE BENEFITS BASED  UPON
THE VALUE OR DECLINE IN VALUE OF ASSETS HELD IN OR RELATING TO AN ALTER-
NATIVE  ACCOUNT  AT ANY TIME THE CONTRACT OR CERTIFICATE IS OUTSTANDING.
FOR PURPOSES OF  THIS  ARTICLE,  "ALTERNATIVE  ACCOUNT"  MEANS  A  TRUST
ACCOUNT,   CUSTODIAL  ACCOUNT,  SECURITIES  BROKERAGE  ACCOUNT,  MANAGED
ACCOUNT, ACTUAL OR SYNTHETIC INVESTMENT PORTFOLIO, OR,  IF  APPROVED  BY
THE  SUPERINTENDENT,  ANY  OTHER  ACCOUNT OR INVESTMENT ARRANGEMENT, THE
INVESTMENTS IN OR RELATED TO WHICH SHALL BE AS AUTHORIZED OR APPROVED BY
THE DOMESTIC OR AUTHORIZED LIFE INSURER ISSUING SUCH CONTRACT OR CERTIF-
ICATE. FOR PURPOSES OF THIS SUBSECTION, "ACTUAL OR SYNTHETIC  INVESTMENT
PORTFOLIO"  SHALL MEAN A PORTFOLIO OF INVESTED ASSETS LEGALLY OR BENEFI-
CIALLY OWNED BY THE OWNER OR BENEFICIARY OF  SUCH  CONTRACT  OR  CERTIF-
ICATE, OR A NOTIONAL PORTFOLIO OF INVESTED ASSETS THAT NEED NOT BE OWNED
BY  THE  OWNER  OR  BENEFICIARY  OF SUCH CONTRACT OR CERTIFICATE BUT THE
ADDITION OR REMOVAL OF ASSETS FROM SUCH NOTIONAL PORTFOLIO  ARE  SUBJECT
TO  THE  CONTROL OF THE OWNER OR BENEFICIARY OF SUCH CONTRACT OR CERTIF-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08908-01-1
              

A. 6748                             2

ICATE. ALTERNATIVE ACCOUNTS SHALL NOT BE  DEEMED  SEPARATE  ACCOUNTS  OR
SUBJECT  TO  REGULATIONS APPLYING TO SEPARATE ACCOUNTS AND THE GROUP AND
INDIVIDUAL  ANNUITY  CONTRACTS  AND  CERTIFICATES  DESCRIBED   IN   THIS
SUBSECTION  SHALL  NOT  BE  SUBJECT  TO  REGULATIONS CONCERNING SEPARATE
ACCOUNT PRODUCTS.
  THE SUPERINTENDENT MAY PROMULGATE REGULATIONS TO:
  (1) DEFINE TERMS USED  IN  THIS  SUBSECTION  THAT  ARE  NOT  OTHERWISE
DEFINED;
  (2)  REQUIRE  THAT  THE  DOMESTIC OR AUTHORIZED LIFE INSURER ESTABLISH
ADEQUATE SYSTEMS OF CONTROL AND REPORTING TO ENSURE THAT THE ASSETS HELD
IN OR RELATED TO AN ALTERNATIVE ACCOUNT ARE AUTHORIZED  OR  APPROVED  BY
SUCH  INSURER,  AND  THAT  A  SUMMARY  OF SUCH SYSTEMS BE FILED WITH THE
SUPERINTENDENT, AND UPON FILING SHALL BE DEEMED APPROVED  UNLESS  WITHIN
THIRTY  CALENDAR  DAYS  AFTER FILING THE SUPERINTENDENT DISAPPROVES SUCH
SUMMARY AND PROVIDES TO THE FILING INSURER A DETAILED EXPLANATION OF THE
BASIS FOR SUCH DISAPPROVAL; AND
  (3) THE PROVISIONS OF THIS SUBSECTION SHALL NOT BE DEEMED TO AUTHORIZE
THE SUPERINTENDENT TO PROMULGATE ANY RULE OR REGULATION, CIRCULAR LETTER
OR DIRECTIVE, THAT IN ANY WAY EXPANDS THE SUPERINTENDENT'S AUTHORITY  TO
(I)  APPROVE  OR  REGULATE  THE INSURER'S ENTIRE INVESTMENT PORTFOLIO OR
INVESTMENT STRATEGY OR THE ASSETS HELD IN OR RELATED TO THE  ALTERNATIVE
ACCOUNT,  OR  (II)  IMPOSE  STANDARDS  ON  CORPORATE GOVERNANCE THAT ARE
EITHER STRICTER OR CONTRARY TO THE PROVISIONS CONTAINED IN THIS  ARTICLE
OR THE BUSINESS CORPORATION LAW.
  S  3.  Clause  (V)  of item (ii) of subparagraph (J) of paragraph 2 of
subsection (a) of section 6901 of the insurance law, as added by chapter
605 of the laws of 2004, is amended to read as follows:
  (V) the financial guaranty insurance policies provide that  if,  prior
to  payment  by the insurer under the financial guaranty insurance poli-
cies, the guaranty fund has paid a claim under  such  contracts  for  an
amount  that, when added to the amount payable under the financial guar-
anty insurance  policies,  would  exceed  the  amount  owed  under  such
contracts,  then the financial guaranty insurer shall pay the portion of
the amount payable in excess of the contract  amounts  to  the  guaranty
fund instead of to the beneficiary under such contracts; [or]
  S 4. Subparagraph (K) of paragraph 2 of subsection (a) of section 6901
of  the insurance law, as relettered by chapter 605 of the laws of 2004,
is relettered subparagraph (L) and a new subparagraph (K)  is  added  to
read as follows:
  (K)  GROUP  OR INDIVIDUAL ANNUITY CONTRACTS OR CERTIFICATES AUTHORIZED
BY SUBSECTION (G) OF SECTION FOUR THOUSAND TWO  HUNDRED  FORTY  OF  THIS
CHAPTER; OR
  S 5. This act shall take effect immediately.