(a) The custodian for assets, securities, or investments of the insurer may be only a bank, trust company, securities firm, or clearing corporation that is properly authorized by the insurer and approved by the director.
(b) When securities are deposited with a clearing corporation, certificates representing securities of the same class of the same issuer may be merged and held in bulk in the name of the nominee of the clearing corporation with any other securities deposited with the clearing corporation by any person, regardless of the ownership of the securities, and certificates representing securities of small denominations may be merged into one or more certificates of larger denominations. The records of any custodian through which an insurer holds securities in a clearing corporation must show that the securities are held for the insurer and for which accounts of the insurer. Ownership of, and other interest in, the securities may be transferred by bookkeeping entry on the books of the clearing corporation without physical delivery of certificates representing the securities.
(c) A custodial agreement between an insurer and an institution holding the assets, securities, or investments of the insurer must be in writing and must be authorized by a resolution of the board of directors of the insurance company or of an authorized committee of the board. The terms of the custodial agreement must comply with the requirements of the director.