(a) The following classes of investments are eligible for support of an insurer's outstanding liabilities, whether they are made directly or through limited partnership interests, joint ventures, stock of an investment subsidiary or membership interests in a limited liability company, trust certificates, participation certificates, or other similar instruments and, with the prior written approval of the Commissioner, general partnership interests:

(1) Cash;

(2) Bonds, investment pools, trust certificates, asset-backed/mortgage-backed securities, SVO listed mutual funds, debt-like preferred stock, or evidences of indebtedness of governmental units or government sponsored enterprises of a domestic jurisdiction, or private business entities domiciled in a domestic jurisdiction;

(3) (A) Obligations secured by mortgages on real estate situated within a domestic jurisdiction, in an aggregate amount which, together with those investments made pursuant to paragraph (6) of this subsection, does not exceed 45 percent of admitted assets in the case of life insurers and 25 percent in the case of nonlife insurers; but a mortgage loan which is secured by other than a first lien may only be acquired when:

(i) The insurer is the holder of the first lien; or

(ii) No senior loan is cross-collateralized or cross-defaulted with another mortgage loan secured by real estate, and the insurer has the right to cure a default on any senior loans.

(B) The obligations held by the insurer and any obligations with an equal lien priority shall not, at the time of acquisition of the obligation, exceed:

(i) Ninety percent of the fair market value of the real estate, if the mortgage loan is secured by a purchase money mortgage or like security received by the insurer upon disposition of the real estate;

(ii) Eighty percent of the fair market value of the real estate, if the mortgage loan requires immediate scheduled payment in periodic installments of principal and interest, has an amortization period of 30 years or less, and has periodic payments made no less frequently than annually. Each periodic payment shall be sufficient to assure that at all times the outstanding principal balance of the mortgage loan shall be not greater than the outstanding principal balance that would be outstanding under a mortgage loan with the same original principal balance, with the same interest rate and requiring equal payments of principal and interest with the same frequency over the same amortization period. Mortgage loans permitted under this subsection are permitted notwithstanding the fact that they provide for a payment of the principal balance prior to the end of the period of amortization of the loan. For residential mortgage loans, the 80 percent limitation may be increased to 97 percent if acceptable private mortgage insurance has been obtained; or

(iii) Seventy-five percent of the fair market value of the real estate for mortgage loans that do not meet the requirements of division (i) or (ii) of this subparagraph.

(C) For purposes of subparagraph (A) of this paragraph, the amount of an obligation required to be included in the calculation of the loan-to-value ratio may be reduced to the extent the obligation is insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs, or their successors.

(D) Subject to the limitations of Code Section 33-11-58, credit tenant loans with the following characteristics shall be exempt from the provisions of subparagraph (B) of this paragraph:

(i) The loan amortizes over the initial fixed lease term at least in an amount sufficient so that the loan balance at the end of the lease term does not exceed the original appraised value of the real estate;

(ii) The lease payments cover or exceed the total debt service over the life of the loan;

(iii) A tenant or its affiliated entity whose outstanding obligations have a high-grade designation or a comparable rating from a nationally recognized statistical rating organization recognized by the Securities Valuation Office or any successor office in accordance with valuation standards adopted by the National Association of Insurance Commissioners and adopted by regulation promulgated by the Commissioner or as otherwise prescribed by regulation promulgated by the Commissioner and where the tenant or its affiliated entity has a full faith and credit obligation to make the lease payments;

(iv) The insurer holds or is the beneficial holder of a first lien mortgage on the real estate;

(v) The expenses of the real estate are passed through to the tenant, excluding exterior, structural, parking, and heating, ventilation, and air conditioning replacement expenses, unless annual escrow contributions from cash flows derived from the lease payments cover the expense shortfall; and

(vi) There is a perfected assignment of the rents due pursuant to the lease to, or for the benefit of, the insurer.

(E) An insurer shall not acquire an investment under this paragraph if, as a result of and after giving effect to the investment, the aggregate amount of all investments then held by the insurer under this paragraph would exceed:

(i) Four percent of its admitted assets in mortgage loans covering any one secured location;

(ii) One percent of its admitted assets in construction loans covering any one secured location; or

(iii) Eight percent of its admitted assets in construction loans in the aggregate;

(4) Common stock or equity-like preferred stock or equity interests in any business entity in a domestic jurisdiction, or shares of mutual funds registered with the Securities and Exchange Commission of the United States under the Investment Company Act of 1940, other than Securities Valuation Office listed mutual funds, in an amount not exceeding 20 percent of admitted assets in the case of life insurers, and 25 percent in the case of nonlife insurers;

(5) Real property for the convenient accommodation of the insurer's (which may include its affiliates) business operations, including home office, branch office, and field office operations, in an amount not exceeding 10 percent of admitted assets;

(A) Real estate acquired under this paragraph may include excess space for rent to others, if the excess space, valued at its fair market value, would otherwise be a permitted investment under paragraph (6) of this subsection and is so qualified by the insurer;

(B) The real estate acquired under this paragraph may be subject to one or more mortgages, liens, or other encumbrances, the amount of which shall, to the extent that the obligations secured by the mortgages, liens, or encumbrances are without recourse to the insurer, be deducted from the amount of the investment of the insurer in the real estate for purposes of determining compliance with this Code section; and

(C) For purposes of this paragraph, business operations shall not include that portion of real estate used for the direct provision of health care services by an accident and sickness insurer for its insureds. An insurer may acquire real estate used for these purposes under paragraph (6) of this subsection;

(6) Real property, together with the fixtures, furniture, furnishings, and equipment pertaining thereto situated in a domestic jurisdiction, in an amount not exceeding 20 percent of admitted assets in the case of life insurers, and 10 percent in the case of nonlife insurers. Real estate acquired under this paragraph:

(A) Shall be income producing or intended for improvement or development for investment purposes under an existing program (in which case the real estate shall be deemed to be income producing);

(B) May be subject to mortgages, liens, or other encumbrances, the amount of which shall, to the extent that the obligations secured by the mortgages, liens, or encumbrances are without recourse to the insurer, be deducted from the amount of the investment of the insurer in the real estate for purposes of determining compliance with subparagraph (C) of this paragraph; and

(C) An insurer shall not acquire an investment under this paragraph if, as a result of and after giving effect to the investment and any outstanding guarantees made by the insurer in connection with the investment, the aggregate amount of investments then held by the insurer under this paragraph plus the guarantees then outstanding would exceed:

(i) Four percent of its admitted assets in one parcel or group of contiguous parcels of real estate, except that this limitation shall not apply to that portion of real estate used for the direct provision of health care services by an accident and sickness insurer for its insureds, such as hospitals, medical clinics, medical professional buildings, or other health facilities used for the purpose of providing health services; or

(ii) Fifteen percent of its admitted assets in the aggregate;

(7) Loans, securities, or other investments of the types described in paragraphs (1) through (6) of this subsection in countries other than the United States and Canada, provided that the aggregate amount of investments shall not exceed 20 percent of admitted assets;

(8) Bonds or other evidences of indebtedness of international development organizations of which the United States is a member, in an amount not exceeding 5 percent of admitted assets in each organization;

(9) Loans upon the security of the insurer's own policies in amounts that are adequately secured by the policies and that in no case exceed the surrender values of the policies;

(10) Tangible personal property under contract of sale or lease under which contractual payments may reasonably be expected to return the principal of and provide earnings on the investment within its anticipated useful life, in an amount not exceeding 2 percent of admitted assets;

(11) Loans guaranteed as to principal and interest by the Georgia Higher Education Assistance Corporation, to the extent of such guaranty;

(12) Chattel mortgage loans as follows:

(A) In connection with a loan on the security of real estate designed and used primarily for residential purposes only, which loan was acquired in accordance with paragraph (3) of subsection (a) of this Code section, an insurer may lend or invest an amount not exceeding 20 percent of the amount loaned on a chattel mortgage to be amortized by regular periodic payments within a term of not more than five years, and representing a first and prior lien, except for taxes not then delinquent, on personal property constituting durable equipment owned by the mortgagor or security grantor and kept and used in the mortgaged premises;

(B) For the purpose of this paragraph, the term "durable equipment" shall include only mechanical refrigerators, air-conditioning equipment, mechanical laundering machines, heating and cooking stoves and ranges, and in addition, in the case of apartment houses and hotels, room furniture and furnishings;

(C) Prior to the acquisition of a chattel mortgage as prescribed by this Code section, items of property to be included in such mortgage shall be separately appraised by a qualified appraiser and the fair market value of such items of property determined. No chattel mortgage loan shall exceed in amount the same ratio of loan to the value of the property as is applicable to the companion loan on the real property; and

(D) This paragraph shall not prohibit an insurer from taking liens on personal property as additional security for any investment otherwise eligible under this article;

(13) (A) If real property securing any evidence of indebtedness held by an insurer is used for agricultural purposes and a proceeding to foreclose the security instrument or an insolvency proceeding relating to the mortgagor has been commenced or, if the mortgagor has made an assignment for the benefit of creditors, the insurer may, for the purpose of preserving or enhancing the earnings of the property:

(i) Purchase agricultural livestock or equipment and utilize the same or cause the same to be utilized in the operation of the property by the mortgagor, or a receiver or trustee, or by the insurer-creditor; or

(ii) Lend up to the value of any agricultural equipment or livestock which may be used in the operation of the property, on the security of a first lien on the equipment and livestock.

(B) Nothing in this Code section shall be deemed to limit any right which the insurer may otherwise have under or with respect to any loan, mortgage, or investment;

(14) Subject to prior approval of the Commissioner, an insurer may acquire and hold real property for recreation, hospitalization, convalescence, and retirement purposes of its employees. All investments under this paragraph shall not exceed 5 percent of the insurer's surplus; or, if a mutual or reciprocal insurer, all of those investments shall not exceed 5 percent of the insurer's surplus in excess of the surplus required to be maintained under this title for its authority to transact insurance;

(15) Other investments the Commissioner authorizes by regulation; and

(16) Investments not otherwise expressly permitted by this Code section but not specifically prohibited by statute, to the extent of not more than 10 percent of the insurer's admitted assets.

(b) An insurer may exceed the aggregate limitation contained in paragraph (3) of subsection (a) of this Code section by no more than 30 percent of its admitted assets if:

(1) This increased amount is invested only in residential mortgage loans;

(2) The insurer has no more than 10 percent of its admitted assets invested in mortgage loans other than residential mortgage loans;

(3) The loan-to-value ratio of each residential mortgage loan does not exceed 60 percent at the time the mortgage loan is qualified under this increased authority, and the fair market value is supported by an appraisal no more than two years old, prepared by an independent appraiser; and

(4) A single mortgage loan qualified under this increased authority shall not exceed 0.5 percent of its admitted assets.

(c) With the permission of the Commissioner, additional amounts of real estate may be acquired under paragraph (5) of subsection (a) of this Code section.