Amends GS 58-7-185, prohibiting insurers from investment underwriting for securities issued by any corporation or enterprise, the controlling interest of which is or will after acquisition by the insurer be held directly or indirectly by the insurer or any combination of the insurer and the insurer's directors, officers, parent corporations, subsidiaries, or controlling stockholders, except with consent from the Commissioner of Insurance. Current law provides that this provision does not apply to investments in subsidiaries under GS 58-19-10 (subsidiaries of insurers). This act adds that this provision also does not apply to transactions involving an insurer within an insurance holding company system regulated under GS 58-19-30 (standards and management of an insurer within an insurance holding company system), or transactions described by GS 58-7-200(e), as amended below.

Amends GS 58-7-200(e), concerning investment transactions not prohibited by the statute, to make clarifying and technical changes. Adds three new subdivisions to subsection (e) specifying the following transactions are also not prohibited by the statute: (1) an insurer investing in or lending its funds to an affiliate, subject to GS 58-19-30 and GS 58-7-170 (diversification); (2) an insurer directly or indirectly investing in or lending its funds to a nonaffiliate in which an officer, director, or controlling stockholder directly or indirectly holds an interest, so long as the investment or loan transaction meets the standards of GS 58-7-170 and GS 58-19-30(a)(1) and (2) (requirements for fair and reasonable terms and reasonable charges/fees); and (3) an insurer directly or indirectly making or holding an investment described in GS 58-7-173(11) (specified bonds, notes, and other interest-bearing or interest accruing obligations of solvent institutions), subject to GS 58-19-30 and GS 58-7-170. 

Existing GS 58-7-200(c) prohibits an insurer from directly or indirectly investing in or lending funds to any of its directors, officers, controlling stockholders, or any other person in which an officer, director, or controlling stockholder is substantially interested, and prohibits any director, officer, or controlling stockholder from directly or indirectly accepting the funds. Adds new subsection (f) to GS 58-7-200, establishing that existing subsection (c) does not apply with respect to any investment by an insurer in an entity in which the officers, directors, and controlling shareholders hold no more than 10% of the voting interests or which is otherwise not an affiliate of the insurer, or which is controlled by a trust established in accordance with the NC Uniform Trust Code. Requires the investment under this provision to comply with the requirements of GS 58-19-30 and GS 58-7-170, and the trust be controlled by a trustee not affiliated with the insurer.

Provides that the changes to GS 58-7-200 apply retroactively to any transaction entered into on or after July 1, 2015.

Amends GS 58-7-179(c), which details cap amounts for mortgage loan(s) made or acquired by an insurer on any one property at the time of investment by the insurer. Deletes the existing provisions and now provides that mortgage loans made or acquired by an insurer on any one property at the time of investment by the insurer cannot exceed the larger of: (1) 90% 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; (2) 80% of the fair market value of the real estate or 97% for residential mortgage loans if the borrower obtains the specified private mortgage insurance, if the mortgage loan requires immediate scheduled payment in periodic installments of principal and interest, has an amortization of 30 years or less, and requires periodic payment made no less frequently than annually; or (3) 75% of the fair market value of the real estate for mortgage loans that do not meet the requirements of the previous two provisions.

Enacts GS 58-7-184, permitting an insurer to enter into securities lending, repurchase, reverse repurchase, and dollar roll transactions with business entities, subject to seven detailed requirements, including requiring the insurer to enter into a written agreement for all authorized transactions under the statute other than dollar roll transactions, and requiring that each written agreement terminate no more than one year from its inception or upon the earlier demand of the insurer. Defines dollar roll transaction, repurchase transaction, reverse purchase transaction, and securities lending transaction. 

Current law, GS 58-7-26(a), provides for an asset or a reduction from liability for reinsurance ceded by a domestic insurer to an assuming insurer not meeting the requirements of GS 58-7-21 to be permitted in an amount not exceeding the liabilities carried by the ceding insurer. Current law requires the reduction to be in the amount of funds held by or on behalf of the ceding insurer under a reinsurance contract with the assuming insurer as security for the payment of obligations thereunder, if the security is held in the United States subject to withdrawal solely by and under the exclusive control of the ceding insurer, or in the case of a trust, held qualified in a US financial institution as specified. Amends the provision in GS 58-7-26(a) providing for the permitted forms of a security, to include that the security may be in the form of repurchase and reverse repurchase transactions as defined in GS 58-7-184(a). Makes clarifying and technical changes.

Amends GS 58-7-173, which sets forth 17 permitted insurer investments, to amend subsection (15). Permits insurers to invest in loans with a maturity not in excess of 30 years (currently 12 years) from the date thereof that are secured by the pledge of securities eligible for investment under GS Chapter 58 or by the pledge or assignment of life insurance policies issued by other insurers authorized to transact insurance in this State. Adds that (1) loans upon the pledge of US Government bonds, (2) loans upon the pledge or assignment of life insurance policies, and (3) loans upon the pledge of securities designated in accordance with the Purposes and Procedures Manual issued by the Securities Valuation Office of the NAIC (currently not specified) are prohibited from exceeding the market value of the bonds or the cash surrender value of the projects pledged (currently, prohibited from exceeding 95% of the market value). Establishes that loans made under this subdivision are not renewable for a period beyond 30 years (currently 12 years) from the date of the loan.