P.R. Laws tit. 26, § 650
(1) The board of directors of an insurer shall adopt a written plan to acquire and maintain investments and to outline their investment practices. This plan shall establish guidelines with regard to the quality, maturity, diversity of investments and other requirements, including investment strategies geared to ensure that the investments and investment practices are appropriate for the business conducted by the insurer, its liquidity needs, and its capital and surplus. The board of directors shall review and evaluate the technical and administrative capacity, and the experience and investment record of the company before adopting any written plan related to any investment or investment practice. The plan must contain objectives with regard to the composition of the kinds of investments, including maximum internal limits. The plan must state the professional qualifications of the persons that shall be making routine investment decisions in order to ensure their competence and ethical behavior. The plan must also outline the relation of the types of investment, to the composition of the business portfolio of the insurer and the risk rating that would be most appropriate for the insurer, taking into consideration its capitalization level and expertise in investment management.
(2) All investments acquired and held under §§ 648–662 of this title shall be acquired and owned under the supervision and direction of the board of directors of the insurer. The board of directors shall certify in writing, through a formal resolution to be adopted at least once a year, that all investments have been made pursuant to the delegation, standards, limitations and investment goals established by the board, or by a committee authorized by the board with the responsibility to administer the investments of the insurer.
(3) At least every three months, or more often if necessary, the board of directors of the insurer or a duly authorized committee shall:
(a) Receive and review a summary report of the investment portfolio of the insurer, its investment activities and the investment practices effected pursuant to its delegated authority, for the purpose of determining if the investment activity of the insurer is consistent with its written plan, and
(b) review and update the written plan, as appropriate.
(4) The board of directors or a duly authorized committee, in the discharge of their duties under this section, shall require that the files of any authorization or approval, and any other document that the board or committee may need, and the reports of any action taken pursuant to the authority delegated under subsection (1) of this section, shall always be at the disposal of the board or authorized committee.
(5) The directors of the insurer shall discharge their duties under this section with the degree of care that is proper to the trust relationship with the insurer.
(6) If the insurer does not have a board of directors, all references to a board of directors in §§ 648–662 of this title shall be understood as references to the governing body of the insurer with authority equivalent to that of a board of directors.
(7) Every director of the insurer who, in the discharge of his/her duties under this section incurs fraud, or a violation of the fiduciary duties, which causes financial damage to the insurer, shall incur personal liability.
History —Ins. Code, added as § 6.040 on May 16, 2003, No. 130, § 1.