50.36—Allocation of premium income associated with entities that do share profits and losses with private sector insurers.
(a) Servicing Carriers.
For
purposes of this Subpart, a servicing carrier is
an insurer that enters into an agreement to place
and service insurance contracts for a State
residual market insurance entity or a State
workers' compensation fund and to cede premiums
associated with such insurance contracts to the
State residual market insurance entity or State
workers' compensation fund. Premiums written by a
servicing carrier on behalf of a State residual
market insurance entity or State workers'
compensation fund that are ceded to such an entity
or fund shall not be included as direct earned
premium (as described in § 50.5(d)(1) or
50.5(d)(2)) of the servicing carrier.
(b) Participant Insurers.
For
purposes of this Subpart, a participant insurer is
an insurer that shares in the profits and losses
of a State residual market insurance entity or a
State workers' compensation fund. Premium income
that is distributed to or assumed by participant
insurers in a State residual market insurance
entity or State workers' compensation fund
(whether directly or as quota share insurers of
risks written by servicing carriers), shall be
included in direct earned premium (as described in
§ 50.5(d)(1) or 50.5(d)(2)) of the participant
insurer.