New York Laws
Article 6 - State Insurance Fund.
87 - Investment of Surplus or Reserve.

(b) For purposes of this section, "security loan agreement" shall mean
a written contract, the terms of which have been approved by the
commissioner of taxation and finance, whereby the state insurance fund
(the lender) agrees to lend securities to a broker-dealer, bank or trust
company described in paragraph (a) of this subdivision (the borrower)
for a period not to exceed one year. However, such agreement shall be
subject to the following limitations: (i) the lender must retain the
right to collect from the borrower all dividends, interest, premiums,
rights, and any other distributions to which the lender would otherwise
have been entitled; (ii) the lender may waive the right to vote the
securities during the term of such agreement; (iii) the lender must
retain the right to terminate such agreement upon not more than five
business days' notice; (iv) the borrower shall provide as collateral to
the lender cash or direct obligations of the United States of America or
any agency or instrumentality thereof or obligations fully guaranteed by
the United States of America that are eligible for investment by the
state insurance fund under subdivision one of this section, provided
that such obligations may in no event consist of derivative securities;
and (v) such agreement shall provide for payment of additional
collateral on a daily basis, or at such time as the value of the loaned
securities increases to agreed upon ratios.
5. All such securities or evidences of indebtedness shall be placed in
the hands of the commissioner of taxation and finance who shall be the
custodian thereof. He or she shall collect the principal and interest
thereof, when due, and pay the same into the state insurance fund. The
commissioner of taxation and finance shall pay all vouchers drawn on the
state insurance fund for the making of such investments when signed by
the chair of the commissioners, the executive director or a deputy
executive director of the state insurance fund upon delivery of such
securities or evidences of indebtedness to him or her, when there is
attached to such vouchers the approval of the state superintendent of
financial services.
6. For the purposes of this section, the term "reserves" does not
include the estimated value of future discretionary payments that may be
made by the state insurance fund under section ninety of this article.
7. Notwithstanding any provision in this section, the surplus and
reserve funds of the state insurance fund shall not be invested in any
investment that has been found by the superintendent of financial
services to be against public policy or in any investment prohibited by
the provisions of paragraph six of subsection (a) of section one
thousand four hundred four of the insurance law or by the provisions of
paragraph one, two, three, four, six, eight, nine or ten of subsection
(a) of section one thousand four hundred seven of the insurance law.