(a) The funds of a mutual aid association shall be in cash or shall be invested as provided in Sections 27-41-3 through 27-41-36 and Section 27-41-38 as applicable to life insurers, except that:
(1) Funds of the association to the extent of its reserve liabilities resulting from valuation of its contracts providing for benefits, aid, or services payable or to be rendered other than in cash may, at the option of the association, be invested in securities or assets eligible for investment of the funds of life insurers in general, but with category limits as follows in lieu of limits otherwise applicable thereto under Sections 27-41-3 through 27-41-36:
a. Not to exceed 25 percent of the reserves of the association in the aggregate may be invested in preferred and guaranteed stocks authorized in Section 27-41-16 and common stocks authorized under Section 27-41-17;
b. Not to exceed 10 percent of such reserves may be invested in insurance stock authorized under Section 27-41-18; and
c. Not to exceed 40 percent of such reserves may be invested in real estate for production of income authorized under Section 27-41-34.
(2) In addition to the investment of particular reserves in designated categories of investments as provided in subdivision (1) of this subsection, the association may invest additional funds in the same categories, but within the percentage limitations otherwise applicable under Sections 27-41-3 through 27-41-36 as computed upon all of the assets of the association after deduction of the reserves mentioned in subdivision (1) of this subsection.
(b) This section shall not apply to mutual aid corporations that received a certificate of authority prior to July 31, 1967. The moneys derived by such corporations from the payment of subscriptions to its capital stock, and the payment of sales of stock (contributed surplus for mutual) may be invested in bonds of the United States or of this state or of the cities or counties of this state, estimated at their market value, or in notes or mortgages secured by real estate collateral worth twice the amount of said mortgages or notes.
(c) Mutual aid corporations, both stock and mutual, organized prior to July 31, 1967, shall be solvent so long as their assets exceed their liabilities.