50.83—Procedure for requesting approval of proposed settlements.
(a) Submission of notice.
Insurers must request advance approval of a
proposed settlement by submitting a notice of the
proposed settlement and other required information
in writing to the Terrorism Risk Insurance Program
Office or its designated representative. The
address where notices are to be submitted will be
available at http://www.treasury.gov/trip following any
certification of an act of terrorism pursuant to
section 102(1) of the Act.
(b) Complete notice.
Treasury
will review requests for advance approval and
determine whether additional information is needed
to complete the notice.
(c)
Treasury response or deemed
approval. Within 30 days after Treasury's
receipt of a complete notice, or as extended in
writing by Treasury, Treasury may issue a written
response and indicate its partial or full approval
or rejection of the proposed settlement. If
Treasury does not issue a response within 30 days
after Treasury's receipt of a complete notice,
unless extended in writing by Treasury, the
request for advance approval is deemed approved by
Treasury. Any settlement is still subject to
review under the claim procedures pursuant to §
50.50.
(d) Notice format.
A notice of a
proposed settlement should be entitled, “Notice of
Proposed Settlement—Request for Approval,” and
should provide the full name and address of the
submitting insurer and the name, title, address,
and telephone number of the designated contact
person. An insurer must provide all relevant
information, including the following, as
applicable:
(1)
A brief description of the insured's
underlying claim, the insured's loss, the amount
of the claim, the operative policy terms, defenses
to coverage, and all damages sustained;
(2)
A certification by the insurer that the
settlement is for a third-party's loss the
liability for which is an insured loss under the
terms and conditions of the underlying commercial
property and casualty insurance policy;
(3)
An itemized statement of all damages by
category (i.e., actual, economic and
non-economic loss, punitive damages, etc.);
(7)
The amount to be paid that will compensate
for any items such as fees and expenses of
attorneys, experts, and other professionals for
their services and expenses related to the insured
loss and/or settlement and the net amount to be received by the third-party after
such payment;
(8)
The amount received from the United States
pursuant to any other Federal program for
compensation of insured losses related to an act
of terrorism;
(9)
The proposed terms of the written
settlement agreement, including release language
and subrogation terms;
(ii)
Determinations of the number of
occurrences under a commercial property and
casualty insurance policy;
(iii)
The allocation of paid amounts or amounts
to be paid to certain policies, or to specific
policy, coverage and/or aggregate limits; and
(iv)
Any other agreement that may affect the
payment or amount of the Federal share of
compensation to be paid to the insurer;
(11)
A statement indicating whether the
proposed settlement has been approved by the
Federal court or is subject to such approval and
whether such approval is expected or likely;
and
(12)
Such other information that is related to
the insured loss as may be requested by Treasury
that it deems necessary to evaluate the proposed
settlement.