(a) As used in this Code section, "variable life insurance policy" means any individual or group policy issued by an insurance company providing for life insurance and benefits incidental thereto, under which payments or values may vary in whole or in part so as to reflect investment results of any segregated portfolio of investments or of a designated separate account or accounts in which amounts received or retained in connection with any of such policies have been placed.

(b) A domestic life insurance company may establish one or more separate accounts and may allocate to the accounts amounts including without limitation proceeds applied under optional modes of settlement or under dividend options to provide for life insurance and benefits incidental thereto, payable in variable amounts, subject to the following:

(1) The income, gains, and losses, realized or unrealized, from assets allocated to a separate account shall be credited to or charged against the account, without regard to other income, gains, or losses of the company;

(2) Except as provided in paragraph (4) of this subsection, amounts allocated to any separate account and accumulations thereon may be invested and reinvested without regard to any requirements or limitations prescribed by the laws of this state governing the investments of domestic life insurance companies, provided that, to the extent that the company's reserve liability with regard to benefits guaranteed as to amount and duration and funds guaranteed as to principal amount or stated rate of interest is maintained in any separate account, a portion of the assets of the separate account at least equal to the reserve liability shall be invested in accordance with the laws of this state governing the investment of reserves of life insurance companies. The investments in the separate account or accounts shall not be taken into account in applying the investment limitations applicable to other investments of the company;

(3) To the extent any domestic company deems it necessary to comply with any applicable federal or state laws, the company, with respect to any separate account, including without limitation any separate account which is a management investment company or a unit investment trust, may provide for persons having an interest therein appropriate voting and other rights and special procedures for the conduct of the business of the account, including without limitation special rights and procedures relating to investment policy, investment advisory services, selection of independent public accountants, and the selection of a committee, the members of which need not be otherwise affiliated with the company, to manage the business of such account. This paragraph shall not affect existing laws pertaining to the voting rights of the life insurance company's stockholders or policyholders except as provided in paragraph (4) of this subsection;

(4) No domestic company shall, for any separate account, purchase the voting securities of a single issuer if the purchase would result in the company and all domestic insurance companies directly or indirectly controlling, controlled by, or under common control with the company and holding in the company's or companies' separate account or accounts an amount in excess of 10 percent of the total issued and outstanding voting securities of the issuer, provided that this limitation shall not apply with respect to securities held in separate accounts, the voting rights in which are exercisable in accordance with instructions from persons having interest in the accounts. This limitation shall not apply to the investment for a separate account in the securities of an investment company registered under the Investment Company Act of 1940;

(5) Unless otherwise approved by the Commissioner, assets allocated to a separate account shall be valued at their market value on the date of valuation or, if there is no readily available market, as provided under the terms of the policy or the rules or other written agreement applicable to the separate account, provided that, unless otherwise approved by the Commissioner, the portion, if any, of the assets of such separate account equal to the company's reserve liability with regard to the guaranteed benefits and funds referred to in paragraph (2) of this subsection shall be valued in accordance with the rules otherwise applicable to the company's assets;

(6) Amounts allocated to a separate account in the exercise of the power granted by this Code section shall be owned by the company, and the company shall not be, nor hold itself out to be, a trustee with respect to such amounts. If and to the extent so provided under the applicable contracts, that portion of the assets of any such separate account equal to the reserves and other contract liabilities with respect to the account shall not be chargeable with liabilities arising out of any other business the company may conduct; and

(7) No sale, exchange, or other transfer of assets may be made by a company between any of its separate accounts or between any other investment account and one or more of its separate accounts unless, in case of a transfer into a separate account, the transfer is made solely to establish the account or to support the operation of the policies with respect to the separate account to which the transfer is made and unless the transfer, whether into or from a separate account, is made by a transfer of cash or by a transfer of securities having a readily determinable market value, provided that the transfer of securities is approved by the Commissioner. The Commissioner may approve other transfers among the accounts if, in his or her opinion, the transfers would not be inequitable.

(c) Each domestic life insurance company shall have the power within the limits of its corporate charter to do all things necessary under any applicable state or federal law in order that variable life insurance policies may be lawfully sold or offered for sale including, without limitation, the power to provide for management of a separate account by persons who may otherwise be unaffiliated with the life insurance company and the power to grant in connection with the policies such voting rights as are set forth in paragraph (3) of subsection (b) of this Code section. Each domestic life insurance company may allocate from its general accounts to each separate account established under this Code section an initial cash amount necessary to meet minimum capitalization requirements for such account as prescribed by the Securities and Exchange Commission, provided that the total of all of the allocations shall not exceed 10 percent of the company's assets or $1 million, whichever is less. Any allocation may be withdrawn when sufficient amounts have been received by the company in connection with variable life insurance policies and allocated to a separate account to meet the minimum capitalization requirement.

(d) Any variable life insurance policy issued under this Code section shall contain a statement of the essential features of the procedure to be followed by the company in determining the dollar amount of variable benefits provided under such policy. Any policy, including a group contract and certificates in evidence of variable benefits issued thereunder, shall state that the dollar amount will vary to reflect investment experience and shall contain on its first page a statement to the effect that benefits under such policy are on a variable basis.

(e) No company shall deliver or issue for delivery variable life insurance policies within this state unless it has a current certificate of authority to transact life insurance in this state and the Commissioner is satisfied that its condition or method of operations in connection with the issuance of such policies will not render its operation hazardous to the public or its policyholders in this state. In this connection, the Commissioner shall consider among other things:

(1) The history and financial condition of the company;

(2) The experience, character, responsibility, and fitness of the officers and directors of the company; and

(3) The law and regulation under which the company is authorized in the state of domicile to issue variable life insurance policies.

(f) The Commissioner shall have sole and exclusive authority to regulate the solicitation, sale, and issuance of variable life insurance policies and to issue any reasonable rules and regulations as may be necessary to carry out the purposes and provisions of this Code section; and the policies, the companies which issue them, and the agents or other persons who sell them shall not be subject to Chapter 5 of Title 10, the "Georgia Securities Act of 1973," in the sale of the policies.

(g) Notwithstanding any other laws of this state, no person shall, within this state, sell or offer for sale variable life insurance contracts as defined in this Code section unless such person shall have both a valid and current life insurance license and variable life insurance license issued by the Commissioner. No license shall be issued unless and until the Commissioner is satisfied, after examination, that the person is by training, knowledge, ability, and character qualified to act as such a variable life insurance agent. The Commissioner may reject any application or suspend or revoke or refuse to renew any variable life insurance agent's license upon any ground that would bar the applicant or the agent from being licensed to sell life insurance contracts in this state or for the violation of any federal or state securities laws or regulations. The rules governing any proceedings relating to the suspension or revocation of a life insurance agent's license shall also govern any proceedings for the suspension or revocation of a variable life insurance agent's license. Renewal of a variable life insurance agent's license shall follow the same procedure established for renewal of an agent's license to sell life insurance contracts in this state.

(h) No variable life insurance policy or certificate issued pursuant to this Code section shall be construed to violate Code Section 33-25-9, and the sale or offer of any such policy or certificate shall not be deemed an unfair method of competition or an unfair or deceptive act or practice in the business of insurance in violation of paragraph (7) and subparagraphs (B) and (C) of paragraph (8) of subsection (b) of Code Section 33-6-4.

(i)(1) Except for paragraphs (1), (5), (6), (7), and (8) of subsection (a) of Code Section 33-25-3, Code Section 33-25-4, and paragraph (1) of Code Section 33-27-3 and except as otherwise provided in this Code section, all pertinent provisions of this title shall apply to separate accounts and variable life insurance policies relating to such accounts. The Commissioner, by regulation, may require that any individual variable life insurance policy delivered or issued for delivery in this state contain provisions as to grace, reinstatement, and nonforfeiture appropriate for that policy; and any such group variable life insurance policy shall contain a provision for grace and nonforfeiture appropriate to that policy.

(2) The reserve liability for variable life insurance policies shall be determined in accordance with actuarial procedures approved by the Commissioner that recognize the variable nature of the benefits provided and any mortality guarantees.