40-5204. Same; prior approval by commissioner required; duties of licensed foreign insurer.
40-5204
40-5204. Same; prior approval by commissionerrequired; duties of licensed foreign insurer.(a) Prior approval by the commissioner is required for anytransaction where aninsurer domiciled in this state assumes or transfers obligations or risks, orboth, on contracts ofinsurance under an assumption reinsurance agreement. No insurer licensed inthis state shalltransfer obligations and/or risks on contracts of insurance issued to or ownedby residents of thisstate to any insurer that is not licensed in this state. An insurer domiciledin this state shall notassume obligations or risks, or both, on contracts of insurance issued to orowned by policyholders residing in any other state unless it is licensed in theother state, or the insuranceregulatory official of that state has approved the assumption.
(b) Any licensed foreign insurer that enters into an assumption reinsuranceagreement whichtransfers the obligations or risks, or both, on contracts of insurance issuedto or owned byresidents of this state, shall file or cause to be filed with the commissionerof insurance of thisstate the assumption certificate, a copy of the notice of transfer and anaffidavit that thetransaction is subject to substantially similar requirements in the state ofdomicile of both thetransferring and assuming insurer. If no such requirements exist in thedomicile of either thetransferring or assuming insurers, then the requirements of this act shallapply.
(c) Any licensed foreign insurer that enters into an assumption reinsuranceagreement whichtransfers the obligations or risks, or both, on contracts of insurance issuedto or owned byresidents of this state, shall obtain prior approval of the commissioner ofinsurance of this stateand be subject to all other requirements of this act with respect to residentsof this state, unlessthe transferring and assuming insurers are subject to assumption reinsurancerequirementsadopted by statute or regulation in the jurisdiction of their domicile whichare substantiallysimilar to those contained herein.
(d) The following factors, along with such other factors as the commissionerdeems appropriateunder the circumstances, shall be considered by the commissioner in reviewing arequest forapproval:
(1) The financial condition of the transferring and assuming insurers and theeffect thetransaction will have on the financial condition of each company;
(2) the competence, experience and integrity of those persons who control theoperation of theassuming insurer;
(3) the plans or proposals the assuming party has with respect to theadministration of thepolicies subject to the proposed transfer;
(4) whether the transfer is fair and reasonable to the policyholders of bothcompanies; and
(5) whether the notice of transfer to be provided by the insurer is fair,adequate and notmisleading.
(e) This section shall take effect on and after July 1, 2004.
History: L. 2004, ch. 128, § 9; May 20.