Connecticut General Statutes 38a-71 – Minimum asset requirements. Minimum capital and minimum surplus requirements
(a) As used in this section:
Terms Used In Connecticut General Statutes 38a-71
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Commissioner: means the Insurance Commissioner. See Connecticut General Statutes 38a-1
- Contract: A legal written agreement that becomes binding when signed.
- Insurance: means any agreement to pay a sum of money, provide services or any other thing of value on the happening of a particular event or contingency or to provide indemnity for loss in respect to a specified subject by specified perils in return for a consideration. See Connecticut General Statutes 38a-1
- insurance company: includes any person or combination of persons doing any kind or form of insurance business other than a fraternal benefit society, and shall include a receiver of any insurer when the context reasonably permits. See Connecticut General Statutes 38a-1
- Life insurance: means insurance on human lives and insurances pertaining to or connected with human life. See Connecticut General Statutes 38a-1
- Mutual insurer: means any insurer without capital stock, the managing directors or officers of which are elected by its members. See Connecticut General Statutes 38a-1
- State: means any state, district, or territory of the United States. See Connecticut General Statutes 38a-1
- United States: means the United States of America, its territories and possessions, the Commonwealth of Puerto Rico and the District of Columbia. See Connecticut General Statutes 38a-1
(1) “Qualified assets” means:
(A) Investments, securities, properties and loans permitted or authorized by law, and the income due thereon;
(B) The net amount of uncollected and deferred premiums for a life insurer which carries the full annual mean tabular reserve liability;
(C) Premiums in the course of collection, other than for life insurance, not more than ninety days past due, with the ninety-day limitation being inapplicable to premiums payable directly or indirectly by the United States government or any of its instrumentalities;
(D) Installment premiums, other than life insurance premiums, in accordance with the regulations adopted by the commissioner in accordance with the provisions of chapter 54, or in the absence of these regulations then in accordance with practices formulated or adopted by the National Association of Insurance Commissioners;
(E) Notes and similar written obligations which are not past due, taken for premiums other than life insurance premiums, on policies permitted to be issued on that basis, to the extent of the unearned premium reserves carried on the policies;
(F) Amounts recoverable or receivable from reinsurers under a reinsurance contract;
(G) Tangible components of health care delivery systems for health care centers governed by sections 38a-175 to 38a-194, inclusive, with the cost of these assets having a finite useful life being depreciated in full over periods provided by regulations adopted by the commissioner in accordance with the provisions of chapter 54;
(H) Electronic data processing equipment and operating software, the cost of which is depreciated in full over a period not to exceed three years;
(I) Tangible components of the service delivery systems of legal service corporations governed by sections 38a-230 to 38a-245, inclusive, with the cost of these assets having a finite useful life being depreciated in full over periods provided by regulations adopted by the commissioner in accordance with the provisions of chapter 54;
(J) Cash or currency; and
(K) Other assets authorized by regulations adopted by the commissioner in accordance with the provisions of chapter 54.
(2) “Minimum capital and minimum surplus” means the capital and surplus that must constantly be maintained by a stock insurance company as required by section 38a-72.
(3) “Surplus” means total statutory surplus less capital stock, adjusted for the par value of any treasury stock, calculated in accordance with the National Association of Insurance Commissioners Accounting Practices and Procedures Manual, version effective January 1, 2001, and subsequent revisions. Except for assessable mutuals, the minimum surplus of a mutual insurer is essentially the same as the minimum required capital requirement which applies to stock-insurers.
(4) “Capital” means the capital stock component of statutory surplus, as defined in the National Association of Insurance Commissioners Accounting Practices and Procedures Manual, version effective January 1, 2001, and subsequent revisions.
(b) Each insurer authorized to do business in this state shall maintain qualified assets in the amount equal to the total of the insurer’s (1) liabilities, and (2) minimum capital and minimum surplus required under section 38a-72.