§ 1314. Deposits; custody, beneficiaries, exchanges, inspection and
income. (a) (1) The superintendent shall be the official custodian of
all deposits of securities required or authorized by the provisions of
this chapter, unless otherwise specifically provided by law. He shall
keep the same in a safe place provided by the state or in custody for
his account with a bank, trust company or national bank in this state
which may be designated by the depositing insurer, subject to the
approval of the superintendent.

(2) All such securities shall be held by the superintendent, in trust,
without preference or priority to any beneficiary entitled to share
therein, for the security of the depositing insurer's policyholders
within the United States, its territories and possessions, except that
securities deposited by an alien insurer shall be held in trust for the
security of the policyholders and creditors of the depositing insurer
within the United States, its territories and possessions.

(3) Such securities may be registered in the name of the
superintendent as such trustee or, at the option of the depositing
insurer, may be in bearer form.

(4) "Policyholders" as used in this chapter in any provision relating
to beneficiaries of deposits includes all persons having a legal or
equitable right against the depositing insurer or the insured arising
out of an insurance or annuity contract. "Depositing insurer" as used in
this chapter includes any lawful successor in interest to such insurer.

(b) The depositing insurer shall not assign or otherwise transfer all
or any part of its interest in any such deposit, without the approval of
the superintendent, and any such transfer, whether voluntary or by
operation of law, without such approval, shall be void. The
superintendent may approve transfer of all of the depositing insurer's
residuary interest in such deposit if with his approval the transferee
assumes all liabilities of the transferor to the beneficiaries of such
deposit.

(c) No judgment creditor or other claimant may levy upon any deposit
or part thereof. Upon the making of an order by a court of competent
jurisdiction for the liquidation, rehabilitation or conservation of any
depositing insurer, the deposit and the income therefrom shall be
transferred to the superintendent as liquidator, rehabilitator or
conservator.

(d) All deposits of securities held by the superintendent which were
made pursuant to any prior insurance law shall be deemed to be held in
compliance with the provisions of this chapter, for the purposes for
which such deposits were originally made.

(e) The depositing insurer may from time to time exchange for any
deposited securities other securities eligible under the provisions of
this chapter if in the opinion of the superintendent the aggregate value
of such deposit will not be thereby reduced below the amount required by
law.

(f) So long as the depositing insurer shall continue solvent and shall
comply with the laws of this state applicable to it, the superintendent
shall permit it to collect and dispose of the income on deposited
securities.

(g) (1) No exchange, release or other transfer of deposited
securities, or any interest therein, shall be valid unless: (i)
countersigned by a member of the state tax commission or a person
designated for such purpose by such commission, and (ii) requested by
the depositing insurer. Except for a transfer for redemption or
refunding, the depositing insurer's request must be evidenced in such
manner as the superintendent requires.

(2) The department of taxation and finance and the department of
financial services shall each keep a book with entries showing the name
of the insurer for whose account such transfer is made by the
superintendent, the name of the transferee unless made in blank, and the
par value of the securities transferred.

(3) Within five days after countersigning and entering the same, the
commissioner of taxation and finance shall advise by mail the insurer
from whose account such transfer is made, of the kind and amount of
security transferred.

(h) Every depositing insurer shall, at least once during each calendar
year, cause such securities to be examined by some person duly
authorized in writing. Such person shall, at the request of the
superintendent, execute a certificate stating the result of such
examination.