Section 4526. Investments of fraternal benefit societies

(a) For purposes
  of investments made pursuant to the provisions of section  one  thousand
  four  hundred  four  of  this chapter, the term "institution" shall only
  include a corporation, a joint-stock association, and a  business  trust
  and  the term "obligations" shall only include bonds, debentures, notes,
  or other evidences of indebtedness. Notwithstanding the  provisions  set
  forth  in  items  (ii)  and (iv) of subparagraph (A) of paragraph two of
  subsection (a) of such section, a society is authorized to invest, in an
  amount not to exceed thirty-three percent  of  its  admitted  assets  as
  shown  by  its  last  statement  on  file  with  the  superintendent, in
  obligations of American institutions which:
    (1) are  rated  BBB  or  higher  (or  the  equivalent  thereto)  by  a
  securities  rating agency recognized by the superintendent, or if not so
  rated, are similar in structure and in all material  respects  to  other
  obligations of the same institution which are so rated, or
    (2) have been given at least the second highest quality designation by
  the Securities Valuation Office of the National Association of Insurance
  Commissioners.
    (b)  Investments  in loans secured by real property and investments in
  real property made pursuant to the provisions  of  paragraphs  four  and
  five  of  subsection  (a) of such section shall be permitted only to the
  extent that such investments are  acquired  or  held  directly  by  such
  society.
    (c)  Foreign  investments made pursuant to the provisions of paragraph
  six of such subsection shall only consist of the following:
    (1) Investments in Canada which are substantially of the  same  kinds,
  classes  and  investment  grades  as those eligible for investment under
  other provisions of  such  subsection.  The  aggregate  amount  of  such
  investments held at any time shall not exceed the greater of ten percent
  of  the society's admitted assets as shown by its last statement on file
  with the superintendent or the amount, if  any,  permitted  pursuant  to
  paragraph two hereof.
    (2)  Investments in a foreign country or in a possession of the United
  States if the society is authorized to do business therein,  or  if  the
  society  has  outstanding insurance, annuity or reinsurance contracts on
  lives or risks resident or located therein;  provided  such  investments
  are  substantially  of  the same kinds, classes and investment grades as
  those eligible for investment under other provisions of such subsection.
  The aggregate amount of such investments and of cash in the currency  of
  such  country  or  possession  at  any  time  held  shall not, except as
  permitted by paragraph one hereof, exceed the amount which such  society
  is  required  by  law to invest in such country or possession or one and
  one-half times the amount of its reserves and  other  obligations  under
  such contracts, whichever is greater.
    (3)  Investments  in  any  foreign country, in addition to investments
  permitted under paragraphs one and two hereof, which  are  substantially
  of  the  same  kinds,  classes  and  investment  grades, and in the same
  proportions, as those eligible for investment under other provisions  of
  such subsection and subsection (a) of this section. The aggregate amount
  of  such  investments  made  pursuant to this paragraph shall not exceed
  four percent of the society's admitted  assets  as  shown  by  its  last
  statement  on  file  with the superintendent and provided that a society
  shall not make any investment in any foreign country  pursuant  to  this
  paragraph,  if  such  investment, together with all other investments in
  the same foreign country so made and then held by  such  insurer,  would
  exceed one percent of the society's admitted assets as shown by its last
  statement on file with the superintendent.

    (d)  Investments  in equity interests made pursuant to paragraph eight
  of such subsection shall be limited to investments in common shares  and
  shall  not  include investments in partnership interests or other equity
  interests.