CHAPTER 18. DISCLOSURE OF MATERIAL TRANSACTIONS
IC 27-2-18
Chapter 18. Disclosure of Material Transactions
IC 27-2-18-1
"Asset acquisition" defined
Sec. 1. (a) As used in this chapter, "asset acquisition" includes
every purchase, lease, exchange, merger, consolidation, succession,
or other acquisition.
(b) The term does not include the construction on or development
of real property by or for the reporting insurer or the acquisition of
materials for construction or development.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-2
"Asset disposition" defined
Sec. 2. As used in this chapter, "asset disposition" includes every
sale, lease, exchange, merger, consolidation, mortgage,
hypothecation, assignment (whether for the benefit of creditors or
otherwise), abandonment, destruction, or other disposition.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-3
"Domicile" defined
Sec. 3. As used in this chapter, "domicile" means the following:
(1) For a corporation, the state in which the purchasing group
is incorporated.
(2) For an unincorporated entity, the state of its principal place
of business.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-4
"Material acquisition" defined
Sec. 4. As used in this chapter, "material acquisition" means an
asset acquisition or a series of related asset acquisitions during any
thirty (30) day period that:
(1) is nonrecurring;
(2) is not in the normal course of business; and
(3) involves more than five percent (5%) of the reporting
insurer's total admitted assets as reported in the insurer's most
recent statutory statement filed with the department.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-5
"Material disposition" defined
Sec. 5. As used in this chapter, "material disposition" means an
asset disposition or a series of related asset dispositions during any
thirty (30) day period that:
(1) is nonrecurring;
(2) is not in the normal course of business; and
(3) involves more than five percent (5%) of the reporting
insurer's total admitted assets as reported in the insurer's most
recent statutory statement filed with the department.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-6
"Material nonrenewal, cancellation, or revision of a ceded
reinsurance agreement" defined; reportable material revisions
Sec. 6. (a) As used in this chapter, "material nonrenewal,
cancellation, or revision of a ceded reinsurance agreement" has the
following meanings:
(1) When used in connection with property and casualty
business, including accident and sickness insurance business
written by a property and casualty insurer, the term means a
nonrenewal, cancellation, or revision that affects:
(A) more than fifty percent (50%) of the insurer's total ceded
written premium; or
(B) more than fifty percent (50%) of the insurer's total ceded
indemnity and loss adjustment reserves.
(2) When used in connection with life insurance or accident and
sickness insurance business, the term means a nonrenewal,
cancellation, or revision that affects more than fifty percent
(50%) of the total reserve credit taken for business ceded on an
annualized basis, as indicated in the insurer's most recent annual
statement.
(b) The following events constitute a material revision of a ceded
reinsurance agreement for property and casualty insurance, life
insurance, or accident and sickness insurance business meeting the
requirements of subsection (a) and must be reported:
(1) An authorized reinsurer representing more than ten percent
(10%) of a total cession is replaced by one (1) or more
unauthorized reinsurers.
(2) Previously established collateral requirements have been
reduced or waived as respects one (1) or more unauthorized
reinsurers representing collectively more than ten percent (10%)
of a total cession.
(c) A nonrenewal, cancellation, or revision of a ceded reinsurance
agreement is not material and a filing is not required under
subsection (a) or (b) for the following:
(1) In connection with property and casualty business, including
accident and sickness insurance business written by a property
and casualty insurer, the insurer's total ceded written premium
represents, on an annualized basis, less than ten percent (10%)
of the insurer's total written premiums for direct and assumed
business.
(2) In connection with life insurance or accident and sickness
insurance business, the total reserve credit taken for business
ceded represents, on an annualized basis, less than ten percent
(10%) of the statutory reserve requirement before any cession.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-7
Reports
Sec. 7. (a) Except as provided in subsection (b), an insurer
domiciled in Indiana shall file a report with the commissioner
disclosing:
(1) a material acquisition;
(2) a material disposition; and
(3) a material nonrenewal, cancellation, or revision of a ceded
reinsurance agreement.
(b) A report of a transaction described in subsection (a) does not
have to be filed with the commissioner under this section if the
transaction was previously submitted to the commissioner for review,
approval, or information purposes under other provisions of IC 27,
rules adopted by the department, or other requirements.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-8
Time of filing
Sec. 8. The report required in section 7 of this chapter must be
filed not later than fifteen (15) days after the end of the calendar
month in which the transaction that requires the filing occurred.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-9
Filing copies
Sec. 9. One (1) complete copy of the report, including any
exhibits or other attachments filed with the report, shall be filed with
the:
(1) department; and
(2) National Association of Insurance Commissioners.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-10
Reports as confidential information; exceptions
Sec. 10. (a) Except as provided in subsections (b) and (c), any
report obtained by or disclosed to the commissioner under this
chapter:
(1) shall be confidential information; and
(2) shall not, without the prior written consent of the insurer to
which it pertains, be:
(A) subject to subpoena; or
(B) made public by the commissioner, the National
Association of Insurance Commissioners, or any other
person.
(b) A report obtained under this chapter may be made available to
other departments of insurance in other states subject to
IC 27-1-3-10.5.
(c) The commissioner may, after giving notice and an opportunity
to be heard to the insurer that would be affected by the release of
information under this chapter:
(1) determine that the interests of policyholders, shareholders,
or the public will be served by the publication of information in
the report under section 7 of this chapter; and
(2) publish all or any part of the information in such manner as
the commissioner considers appropriate.
(d) The commissioner may not:
(1) disclose; or
(2) subject to subpoena;
financial information regarding material transactions disclosed by an
insurer under this chapter.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-11
Contents of reports of material acquisitions and dispositions
Sec. 11. The following information must be disclosed in any
report of a material asset acquisition or asset disposition:
(1) The date of the transaction.
(2) The manner of the asset acquisition or asset disposition.
(3) A description of the assets involved.
(4) The nature and amount of the consideration given or
received in connection with the asset acquisition or the asset
disposition.
(5) The purpose of or reason for the transaction.
(6) The manner by which the amount of consideration was
determined.
(7) The gain or loss recognized or realized as a result of the
transaction.
(8) The name of each person from whom the assets were
acquired or to whom the assets were disposed.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-12
Reports of material acquisitions and dispositions on
nonconsolidated basis; exceptions
Sec. 12. (a) Insurers must report material acquisitions and
dispositions on a nonconsolidated basis unless the insurer is part of
a consolidated group of insurers that uses a pooling arrangement or
one hundred percent (100%) reinsurance agreement that affects the
solvency and integrity of the insurer's reserves and the insurer ceded
substantially all of its direct and assumed business to the pool.
(b) An insurer is considered to have ceded substantially all of its
direct and assumed business to a pool under subsection (a) if the
insurer has less than one million dollars ($1,000,000) total direct plus
assumed written premiums during a calendar year that are not subject
to a pooling arrangement and the net income of the business not
subject to the pooling arrangement represents less than five percent
(5%) of the insurer's capital and surplus.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-13
Contents of reports of material nonrenewals, cancellations, or
revisions
Sec. 13. The following information must be disclosed on a
nonconsolidated basis in any report of a material nonrenewal,
cancellation, or revision of a ceded reinsurance agreement:
(1) The effective date of the nonrenewal, cancellation, or
revision.
(2) The description of the transaction with an identification of
the initiator of the transaction.
(3) The purpose of or reason for the transaction.
(4) If applicable, the identity of the replacement reinsurers.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-14
Reports of material nonrenewals, cancellations, or revisions on
nonconsolidated basis; exceptions
Sec. 14. (a) An insurer must report all material nonrenewals,
cancellations, or revisions of ceded reinsurance agreements on a
nonconsolidated basis unless:
(1) the insurer is part of a consolidated group of insurers that
uses a:
(A) pooling arrangement; or
(B) one hundred percent (100%) reinsurance agreement;
that affects the solvency and integrity of the insurer's reserves;
and
(2) the insurer ceded substantially all of its direct and assumed
business to the pool.
(b) An insurer is considered to have ceded substantially all of its
direct and assumed business to a pool under subsection (a) if the
insurer has less than one million dollars ($1,000,000) total direct plus
assumed written premiums during a calendar year that are not subject
to a pooling arrangement and the net income of the business not
subject to the pooling arrangement represents less than five percent
(5%) of the insurer's capital and surplus.
As added by P.L.251-1995, SEC.17.