Delaware Code Title 18 Sec. 6956 – Securities of special purpose financial captive insurance companies
(a) A special purpose financial captive insurance company may:
(1) Subject to the approval of the Commissioner, account for the proceeds of surplus notes issued by the special purpose financial captive insurance company as surplus and not as debt for purposes of statutory accounting; and
(2) Submit to the Commissioner periodic written requests for the advance approval by the Commissioner of the special purpose financial captive insurance company‘s making payments of interest on and repayments of principal of surplus notes.
Terms Used In Delaware Code Title 18 Sec. 6956
- Captive insurance company: means any pure captive insurance company, association captive insurance company, agency captive insurance company, sponsored captive insurance company, industrial insured captive insurance company, special purpose captive insurance company, special purpose financial captive insurance company, series captive insurance company, or risk retention group, whether domestic, foreign or alien, or branch captive insurance company, licensed under the provisions of this chapter. See Delaware Code Title 18 Sec. 6902
- Commissioner: means the Insurance Commissioner of this State. See Delaware Code Title 18 Sec. 6902
- Contract: A legal written agreement that becomes binding when signed.
- Insurance: has the meaning given such term in § 102 of this title. See Delaware Code Title 18 Sec. 6902
- Special purpose financial captive insurance company: means a captive insurance company that is granted a certificate of authority under this subchapter. See Delaware Code Title 18 Sec. 6952
- Special purpose financing transaction: means :
- State: means the State of Delaware, and "state" means any other state, district, commonwealth or possession of the United States of America. See Delaware Code Title 18 Sec. 6902
(b) The Commissioner may approve, in advance, ongoing interest payments or principal repayments, or both, by the special purpose financial captive insurance company, provided that the interest payments or principal repayments, or both, are made in accordance with the plan of operation and formulas contained in the plan of operation.
(c) Notwithstanding the provisions of subsection (b) of this section, payment of interest or repayment of principal may not be made without the approval of the Commissioner if the operation or financial condition of the special purpose financial captive insurance company deviates from the formula approved by the Commissioner pursuant to subsection (b) of this section or if the payment of interest or repayment of principal threatens the solvency or liquidity of the special purpose financial captive insurance company.
(d) A security issued by a special purpose financial captive insurance company is not subject to regulation as an insurance contract. An investor in these securities or a holder of these securities is not considered to be transacting the business of insurance in this State solely by reason of having an interest in these securities. The underwriter’s placement or selling agents and their partners, commissioners, officers, members, managers, employees, agents, representatives, and advisors involved in a special purpose financing transaction by a special purpose financial captive insurance company are not considered to be insurance producers or to be conducting business as an insurance company or as an insurance agency, brokerage, intermediary, advisory, or consulting business solely by virtue of their underwriting activities in connection with the special purpose financing transaction.