Tennessee Senate Bill SB0696

Tennessee 2025-2026 Regular Session

• Introduced: 2/3/25
• Engrossed: 3/3/25
• Enrolled: 3/11/25
• Passed: 3/25/25
• Chaptered: 4/8/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 56, Chapter 3, Part 4, relative to investments by insurance companies.

Summary

SB0696 amends Tennessee’s insurance investment statutes to expand the types and amounts of investments that insurance companies may hold. The bill increases one existing investment limit from 1% to 20% and another from 5% to 10%, broadening insurers’ permitted exposure in categories governed by Title 56, Chapter 3, Part 4. The bill also adds a new authorized investment category for money market funds. Under the new language, insurers may invest in either government money market funds that hold only U.S. government obligations or related collateralized repurchase agreements, or in Class 1 money market funds that qualify under NAIC reserve-factor standards. The statute ties these categories to the NAIC Investment Analysis Office manual, or any successor publication, to determine eligibility and compliance.

Impact

The bill directly amends Tennessee Code Annotated §§ 56-3-402 and 56-3-403, changing the investment rules that apply to insurance companies operating in the state. It loosens prior percentage caps and expressly authorizes additional money market fund investments, thereby giving insurers more flexibility in managing reserves and portfolios while keeping the investments within NAIC-recognized categories.

Sentiment

The available voting history shows strong support and no recorded opposition. The Senate Commerce and Labor Committee recommended passage by an 8-0 vote, and the floor motion to adopt passed 32-0, suggesting the bill was viewed as a technical or industry-oriented update with broad consensus.

Contention

No committee transcript is available, and the recorded votes show no dissent, so there is little evidence of substantive controversy. Any potential points of concern would likely center on whether increasing investment limits and expanding eligible assets could increase insurer risk, but the legislative record provided does not show organized opposition or debate on that issue.