Section 1414. Valuation of investments

(a) (1) All obligations having a
  fixed term and rate of interest and held by any life  insurance  company
  or fraternal benefit society authorized to do business in this state, if
  amply  secured  and not in default as to principal or interest, shall be
  valued as follows:
    (A) if purchased at par, at the par value;
    (B) if purchased above or below par, on  the  basis  of  the  purchase
  price  adjusted so as to bring the value to par at maturity and yield in
  the meantime the effective rate of interest at which  the  purchase  was
  made, or, in the superintendent's discretion, on the basis of the method
  of calculation commonly known as the pro rata method.
    (2)  The  purchase  price shall in no case be taken at a higher figure
  than the actual market value at the time of acquisition.
    (3)  The  superintendent  shall  have  the  power  to  determine   the
  eligibility  of  any  such  investments  for  valuation  on the basis of
  amortization, and may by regulation prescribe  or  limit  the  types  of
  securities  so  eligible  for amortization. All obligations which in the
  judgment of the superintendent  are  not  amply  secured  shall  not  be
  eligible  for  amortization  and  shall  be  valued  in  accordance with
  subsection (b) hereof.
    (4) The  superintendent  may,  if  he  finds  that  the  interests  of
  policyholders  so permit or require, by regulation permit or require any
  class of insurers, other than  life  insurance  companies  or  fraternal
  benefit  societies,  authorized  to  do business in this state, to value
  their obligations in accordance with the foregoing rule.
    (b) (1) Except  securities  subject  to  amortization  and  except  as
  otherwise  provided  in  this  chapter,  the  investments (including any
  investments in an investment company) of all insurers authorized  to  do
  business  in  this  state  shall  be  valued,  in  the discretion of the
  superintendent, at their market value, or at their appraised  value,  or
  at prices determined by him as representing their fair market value.
    (2)  If  the  superintendent  finds  that  in view of the character of
  investments of the insurer it would  be  prudent  for  such  insurer  to
  establish  a  special reserve for possible losses or fluctuations in the
  values of its investments, he may require that a reserve, reasonable  in
  amount,  be  established  and  maintained and that it be reported in any
  statement or report of the financial condition of such insurer.
    (3) The superintendent may, in  connection  with  any  examination  or
  required financial statement of the insurer, require it to furnish him a
  complete  financial  statement  and  audited  report  of  the  financial
  condition of any corporation whose securities are owned wholly or partly
  by such insurer  and  may  cause  an  examination  to  be  made  of  any
  subsidiary or affiliate of such insurer.
    (c)  (1) The shares of an insurance company which is not a subsidiary,
  or affiliate, including for purposes of this subsection any  corporation
  having  a  majority  of  its  assets  invested  in one or more insurance
  companies, shall be valued in accordance with  subsection  (b)  of  this
  section if such shares are registered on a national securities exchange,
  as provided in the federal Securities Exchange Act of 1934, 15 U.S.C. §§
  78a-78kk.
    (2)  Except as otherwise provided in section four thousand two hundred
  forty of this chapter,  shares  of  an  insurance  company  which  is  a
  subsidiary,  or  affiliate,  shall  be  valued  according to the methods
  approved by the National Association of Insurance Commissioners for  the
  valuation  of  subsidiary,  controlled  and affiliated entities, or such
  other method that the superintendent in a regulation determines would be
  in the best interests of the policyholders and the people of this state.

    (3) The book value of common shares of an insurance company  shall  be
  ascertained  by  dividing  (i)  the  amount of the insurer's capital and
  surplus less the value of all its preferred shares, if any, outstanding,
  by (ii) the number of common shares outstanding.
    (4)  Notwithstanding  the foregoing provisions, an insurer may, at its
  option, value its shares in a subsidiary insurance company in an  amount
  not  less  than acquisition cost if it is less than the value determined
  as hereinbefore provided.
    (d) Real property acquired by foreclosure or by deed in lieu  thereof,
  in   the   absence   of  a  recent  appraisal  deemed  reliable  by  the
  superintendent, shall not be valued at an amount greater than the unpaid
  principal of the  defaulted  loan  at  the  date  of  such  acquisition,
  together with any taxes and expenses paid or incurred by such insurer at
  such  time  in  connection  with such acquisition (but not including any
  uncollected interest on  such  loan),  and  the  cost  of  additions  or
  improvements  thereafter made by such insurer and any amounts thereafter
  paid by such insurer on  any  assessments  levied  for  improvements  in
  connection with the property.
    (e) Purchase money mortgages received on dispositions of real property
  shall  be  valued in an amount not exceeding ninety percent of the value
  of such real property as determined by an appraisal made by an appraiser
  at or about the time of the disposition; provided  that  purchase  money
  mortgages  received  on  dispositions  of real property acquired or held
  pursuant to paragraph five of subsection (a)  of  section  one  thousand
  four  hundred  four  of this article or on dispositions of real property
  acquired or held under section one thousand four hundred  five  of  this
  article  in  satisfaction of loans, mortgages, liens, judgments, decrees
  or other debts previously owing to such insurer in  the  course  of  its
  business  shall  in  no  event  be  valued  in  an  amount exceeding its
  acquisition costs.
    (f) The stock of a subsidiary of an insurer shall  be  valued  on  the
  basis  of  the  greater  of:  (i)  the value of only such assets of such
  subsidiary as would constitute lawful investments if  acquired  or  held
  directly  by  the insurer; or (ii) such other value as may be determined
  pursuant  to  standards  and  cumulative  limitations   in   regulations
  promulgated by the superintendent.
    (g)  Notwithstanding  any  provision  contained  in  this  section  or
  elsewhere  in  this  chapter,  if  the  superintendent  finds  that  the
  interests  of  policyholders  so  permit  or  require,  he may permit or
  require any class of insurers authorized to do business in this state to
  value their investments or any class thereof as of any  date  heretofore
  or  hereafter  in  accordance  with  any  applicable valuation or method
  approved by the National Association of Insurance Commissioners.