SB 96 - This act requires all licensed insurers with annual direct written premiums of over $15 million to make economically targeted investments in low-income communities. Life insurers must invest 1% of their direct written premiums in such communities, and all other insurers shall invest 1/2% of their direct written premiums.

INVESTMENTS - Economically targeted investments include equity or debt investments in various organizations and businesses, community development loans, federal housing projects, local affordable housing projects, purchases of loans for affordable housing, and grants or deferred interest loans for various projects. Insurers get double credit for investments in small businesses for low-income people, small businesses or farms and investments in low-income economic development and housing.

PHASE-IN - The investment requirement is imposed first in the 1998 calendar year. The 1999 calendar year requirement includes the 1998 year's investments. The 2000 calendar year requirement includes the two previous years' investments. All subsequent years' investment requirements include the two previous years' investments.

PLAN - Every insurer shall adopt an annual community investment plan and file it with the director of the Department of Insurance.

PENALTIES - The Director of Insurance may issue an order to show cause if he feels investments have not been properly made. Monetary penalties of up to $50,000 per year may be imposed, plus $150,000 for failing to comply with an order of the Director. The insurer's certificate of authority may also be suspended or revoked.
DENISE GARNIER