Sec. 1. 24 MRSA §2301, sub-§9-A, ¶E, as enacted by PL 1993, c. 702, Pt. A, §1, is amended to read:

E. Notwithstanding any provisions of this section and Title 24-A, chapter 13-A allowing other investments, a corporation subject to this chapter shall maintain cash or investment grade obligations, as defined in Title 24-A, section 1162-A 1151-A, that at all times have a fair market value of not less than 100% of the corporation's liability for claims payable, incurred, but not reported, claims payable, unpaid claims adjustment expenses, unearned premiums and, as applicable, any statutory, special or additional reserves provided by the corporation for the benefit of subscribers as of the close of the corporation's most recent calendar quarter prepared on the basis of statutory accounting principles. If the corporation's liability for these enumerated items increases more than 10% prior to the end of the calendar quarter, the corporation must, within 10 days of the determination, reallocate its investments to ensure compliance with this paragraph.

Sec. 2. 24-A MRSA §1109, first ¶, as amended by PL 1993, c. 313, §22, is further amended to read:

An insurer may invest in obligations, other than those eligible for investment under section 1124 (mortgage loans), issued, assumed or guaranteed by any solvent institution created or existing under the laws of the United States or of Canada, or of any state, province, district or territory thereof, provided that the obligations are not in default as to principal or interest, are investment grade corporate obligations as defined in section 1162-A 1151-A, subsection 7 24, and are qualified under any of the following.

Sec. 3. 24-A MRSA §1110, sub-§3, as enacted by PL 1993, c. 313, §25, is amended to read:

3. The terms defined in section 1162-A 1151-A have the same meanings as used in this chapter.

Sec. 4. 24-A MRSA §1151-A is enacted to read:

§1151-A. Definitions

As used in this chapter and chapter 13, unless the context otherwise indicates, the following terms have the following meanings.