(a)

(1) A protected cell company may establish one (1) or more protected cells by submitting a plan of operation, or amendments to a plan, with respect to each protected cell in connection with an insurance securitization to the Insurance Commissioner for prior written approval.

(2) The plan shall include, but not be limited to:

(A) The specific business objectives of the protected cell; and

(B) The investment guidelines of the protected cell.

(3) Upon receiving written approval, the protected cell company, in accordance with the approved plan of operation, may attribute to the protected cell insurance obligations with respect to its insurance business and obligations relating to the insurance securitization and assets to fund the obligations.

(4) A protected cell shall have its own distinct name or designation, which shall include the words "protected cell".

(5) The protected cell company shall transfer all assets attributable to a protected cell to one (1) or more separately established and identified protected cell accounts bearing the name or designation of that protected cell.

(6) Protected cell assets shall be held in the protected cell accounts for the purpose of satisfying the obligations of that protected cell.

(b)

(1) All attributions of assets and liabilities between a protected cell and the general account shall be in accordance with the plan of operation approved by the commissioner.

(2) No other attribution of assets or liabilities may be made by a protected cell company between the protected cell company's general account and its protected cells.

(3) Any attribution of assets and liabilities between the general account and a protected cell or from investors, in the form of principal on a debt instrument issued by a protected cell company in connection with a protected cell company securitization, shall be in cash or in readily marketable securities with established market values.

(c)

(1) The creation of a protected cell does not create, in respect to that protected cell, a legal person separate from the protected cell company.

(2)

(A) Amounts attributed to a protected cell under this subchapter, including assets transferred to a protected cell account, are owned by the protected cell company.

(B) The protected cell company may not be, nor hold itself out to be, a trustee with respect to those protected cell assets of that protected cell account.

(3) The protected cell company, however, may allow for a security interest to attach to protected cell assets or a protected cell account when in favor of a creditor of the protected cell if allowed by applicable law.

(d)

(1) This subchapter does not prohibit the protected cell company from contracting with or arranging for an investment advisor, commodity trading advisor, or other third party to manage the protected cell assets of a protected cell.

(2) All remuneration, expenses, and other compensation of the third-party advisor or manager are payable from the protected cell assets of that protected cell, and not from the protected cell assets of other protected cells or the assets of the protected cell company's general account.

(e) (1) A protected cell company shall establish administrative and accounting procedures necessary to properly identify the one (1) or more protected cells of the protected cell company and the protected cell assets and liabilities attributable to the protected cells. It shall be the duty of the directors of a protected cell company to:

(A) Keep protected cell assets and liabilities separate and separately identifiable from the assets and liabilities of the protected cell company's general account; and

(B) Keep protected cell assets and liabilities attributable to one protected cell separate and separately identifiable from protected cell assets and liabilities attributable to other protected cells.

(2)

(A) If this subsection is violated, the remedy of tracing shall be applicable to protected cell assets when commingled with protected cell assets of other protected cells or the assets of the protected cell company's general account.

(B) The remedy of tracing shall not be an exclusive remedy.

(f) When establishing a protected cell, the protected cell company shall attribute to the protected cell, assets with a value at least equal to the reserves and other insurance liabilities attributed to that protected cell.