                                 CODE OF VIRGINIA

CANADIAN GOVERNMENTAL OBLIGATIONS (§ 38.2-1416)

A. Obligations of Canada. &#8212; A domestic insurer may invest in bonds, notes,
warrants, and other evidences of indebtedness which are direct obligations of
the government of Canada or for which the full faith and credit of the
government of Canada are pledged for the payment of principal and interest.

B. No domestic insurer shall invest in any obligation under this section unless
the obligation is payable both as to principal and interest in lawful money of
the United States or of Canada.

C. Obligations of provinces. &#8212; A domestic insurer may invest in direct,
general obligations of any province of Canada for the payment of money, or
obligations for the payment of money to the extent guaranteed or insured as to
the payment of principal and interest by any province of Canada, on the
following conditions:

   1. The province has the power to levy taxes for the prompt payment of the
   principal and interest of its obligations;

   2. The province is not in default in the payment of principal or interest on
   any of its direct, guaranteed or insured obligations as of the date of
   investment; and

   3. An insurer shall not invest under this subsection more than five percent of
   its admitted assets in obligations issued or guaranteed by any one province.

D. Local government obligations. &#8212; A domestic insurer may invest in
direct, general obligations of any political subdivision of any province of
Canada for the payment of money, or obligation for the payment of money, to the
extent guaranteed as to the payment of principal and interest, by any such
political subdivision, on the following conditions:

   1. The obligations are payable or guaranteed from ad valorem taxes;

   2. Such political subdivision is not in default in the payment of principal or
   interest on any of its direct or guaranteed obligations;

   3. No investment shall be made under this subsection in obligations which are
   secured only by special assessments for local improvements; and

   4. An insurer shall not invest more than two percent of its admitted assets in
   obligations issued or guaranteed by any one such political subdivision.

HISTORY: 1983, c. 457, § 38.1-217.19; 1986, c. 562; 1992, c. 588.