ORS 733.610
Investment in real property


(1)

Except as otherwise provided in ORS 733.580 (Investment of required capitalization) and 733.600 (Investment in mortgage loans), an insurer may invest in real property only if used for the purposes or acquired in the manner and within the limits as follows:

(a)

The insurer may invest in the land and the buildings thereon in which it has its principal office, and in such other real property as required for its convenient accommodation in the transaction of business. Such investments shall not exceed in the aggregate 10 percent of the assets of the insurer, except with the consent of the Director of the Department of Consumer and Business Services.

(b)

The insurer may invest in real property that is acquired in satisfaction of loans, mortgages, liens, judgments or debts previously owing to the insurer in the course of its business.

(c)

The insurer may invest in real property acquired in part payment of the consideration on the sale of other real property owned by the insurer if the transaction does not increase the investment of the insurer in real property.

(d)

The insurer may invest in real property acquired by gift or devise or through merger, consolidation or bulk reinsurance of another insurer under the Insurance Code.

(e)

The insurer may invest in the vendor’s interest in real property subject to a contract of sale. The amount invested in the vendor’s interest under such a contract shall not exceed, except with the consent of the director:

(A)

Ninety percent of the market value of the subject real property, when the real property is one or two family residential property.

(B)

Eighty percent of the market value of the subject real property, when the real property is other than that described in subparagraph (A) of this paragraph.

(f)

The insurer may invest in real property or any interest therein that is acquired or held by purchase, lease or otherwise, other than real property used primarily for agricultural, ranch, mining, development of oil or mineral resources, recreational, amusement or club purposes, if the real property or interest therein is acquired as an investment for the production of income or acquired to be improved or developed for such investment purposes pursuant to an existing program therefor. The insurer may hold, improve, develop, maintain, manage, lease, sell and convey real property acquired by it under this paragraph. Real property and interests therein so acquired may be leased or sublet. Except with the consent of the director, an insurer shall not have an amount exceeding five percent of its assets at any one time invested in real property and interests therein under this paragraph.

(g)

The insurer may invest in additional real property and in equipment incident to real property if necessary or convenient for the purpose of enhancing the sale or other value of real property previously acquired or held by the insurer under paragraph (b), (c), (d) or (f) of this subsection. The real property and equipment shall be included, together with the real property for the enhancement of which it was acquired, for the purpose of applicable investment limits.

(h)

The insurer may invest in real property without regard to whether the property is income-producing when acquired if the insurer intends to improve the property for resale or if the insurer intends that the property will be income-producing. The insurer may also invest in real property that is income-producing and used primarily for agricultural, ranch, mining, development of oil or mineral resources, recreational, amusement or club purposes. Funds invested under this paragraph shall not exceed the lesser of five percent of the insurer’s assets or 50 percent of the insurer’s capital and surplus, except with the consent of the director.

(i)

Except with the consent of the director, all real property owned by the insurer under this subsection, except as to properties described in paragraphs (a) and (e) of this subsection, shall not at any time exceed 10 percent of the assets of the insurer.

(2)

Except as otherwise provided in subsection (3) of this section:

(a)

Real property acquired under this section shall be disposed of within five years after it ceases to be income-producing or to be used by the insurer for its business operation, whichever is later.

(b)

Real property acquired under subsection (1)(h) of this section that is not income-producing when acquired shall be disposed of within five years after acquisition if the real property is not improved for resale or if the real property is not income-producing during the five years.

(c)

When an investment or any combination of investments by an insurer in real property exceeds any applicable limitation under this section other than a limitation of time, the insurer, not later than the fifth year after the limitation is exceeded, shall dispose of sufficient real property that is subject to the limitation to comply with the limitation.

(3)

Any real property acquired under this section that otherwise qualifies as an investment under ORS 733.510 (Investments of insurers) to 733.780 (Prohibited investments) may be retained and held if approved as an investment in the manner prescribed by ORS 733.730 (Approval by board of directors of investments and deposits) and 733.740 (Record of investments required). The director may extend the time limit prescribed in subsection (2) of this section if the interests of the insurer will suffer by a “forced sale” of the property. [Formerly 738.265; 1979 c.846 §1; 1989 c.425 §4; 2003 c.576 §555]

Source: Section 733.610 — Investment in real property, https://www.­oregonlegislature.­gov/bills_laws/ors/ors733.­html.

733.010
Assets allowed
733.020
Assets not allowed
733.030
Liabilities in general
733.040
Reinsurance credit
733.050
Increase of inadequate reserves
733.060
Unearned premium reserve
733.070
Unearned premium reserve for marine and transportation insurance trip risks
733.080
Reserves for health insurance
733.090
Unearned premium reserve and fund for title insurance
733.095
Unearned premium reserve for home protection insurance
733.100
Contingency reserve liability for mortgage insurance
733.115
Establishing reserves for variable life insurance and annuity policies
733.140
Disallowance of “wash” transactions
733.150
Alternative accounting for assets and liabilities
733.160
Valuation of assets other than securities
733.165
Valuation of securities
733.170
Accounts and records
733.210
Director’s determinations
733.220
Establishment and regulation of separate accounts to fund life insurance or annuities
733.230
Transactions of separate accounts registered with Securities and Exchange Commission
733.300
Short title
733.302
Reserve valuation method for life insurance policies and annuity and pure endowment contracts
733.304
Opinion of actuary
733.306
Computation of minimum standards for life insurance, industrial insurance, annuities and pure endowment contracts
733.308
Computation of minimum standard for annuities and pure endowment contracts
733.310
Interest rates for determining minimum standard for valuation
733.312
Amount of required reserves for life insurance policies
733.314
Amount of required reserves for certain annuity and pure endowment contracts
733.316
Aggregate reserves
733.318
Alternative standards of valuation
733.320
Minimum required reserve for certain policies
733.322
Calculation of reserves for plans for which minimum reserves cannot be determined under ORS 733.312, 733.314 or 733.320
733.325
Definitions
733.328
Annual valuation of reserve liabilities
733.331
Opinion of appointed actuary
733.334
Data submission in accordance with valuation manual
733.337
Confidentiality
733.340
Exemptions
733.510
Investments of insurers
733.520
Current operating requirements exempted
733.530
“Corporation,” “sovereign,” “political subdivision” defined
733.540
“Obligation” defined
733.550
“Amply secured obligation” defined
733.560
“Unencumbered” defined
733.570
“Improved real property” defined
733.575
Prohibited use of funds as compensating balances
733.578
Conditions necessary for investments used to provide compensating balances
733.580
Investment of required capitalization
733.590
Investment in obligations of sovereign, political subdivision thereof or corporation
733.600
Investment in mortgage loans
733.610
Investment in real property
733.620
Investment in stocks of corporation
733.630
Investment in securities or obligations of certain corporations
733.635
Approved activities of corporations in which investments authorized
733.640
Lending funds
733.650
Investment of funds in certain obligations and other specified items
733.652
Investment of funds of separate accounts
733.654
Limitation on amount of separate account investments
733.656
Limitation on securities owned or controlled by separate account investments
733.658
Applicability of separate account investment limitations
733.670
Investment of funds under “prudent investor” standard
733.680
Acquisition and retention of personal property generally
733.685
Investment of funds by home protection insurer
733.690
Investment of funds in title plant
733.695
Investment of funds in obligations that are not investment quality
733.700
Investment of funds in health care service facilities
733.710
Investments authorized by prior law
733.720
Investments subject to additional limitations and requirements
733.730
Approval by board of directors of investments and deposits
733.740
Record of investments required
733.750
Disposal of investments on order of director
733.760
Insurance required on buildings on property which is security for loan
733.770
Limitations on investments in property of any one person or single parcel of real estate
733.780
Prohibited investments
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