Indiana Code 27-1-12.1-7. Requirements for assumption of risk
(1) Comply with IC 27-1-6.
Terms Used In Indiana Code 27-1-12.1-7
- Affidavit: A written statement of facts confirmed by the oath of the party making it, before a notary or officer having authority to administer oaths.
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- capital: means the aggregate amount paid in on the shares of capital stock of a corporation issued and outstanding. See Indiana Code 27-1-2-3
- certificate of authority: means an instrument in writing issued by the department to an insurer, which sets out the authority of such insurer to engage in the business of insurance or activities connected therewith. See Indiana Code 27-1-2-3
- Commissioner: means the "insurance commissioner" of this state. See Indiana Code 27-1-2-3
- Contract: A legal written agreement that becomes binding when signed.
- Insurance: means a contract of insurance or an agreement by which one (1) party, for a consideration, promises to pay money or its equivalent or to do an act valuable to the insured upon the destruction, loss or injury of something in which the other party has a pecuniary interest, or in consideration of a price paid, adequate to the risk, becomes security to the other against loss by certain specified risks; to grant indemnity or security against loss for a consideration. See Indiana Code 27-1-2-3
- life insurance company: means any company making one or more of the kinds of insurance set out and defined in class 1(a) of IC 27-1-5-1. See Indiana Code 27-1-2-3
- limited purpose subsidiary: means a subsidiary life insurance company that is organized under this chapter. See Indiana Code 27-1-12.1-2
- organizing domestic life insurance company: refers to a life insurance company that organizes a limited purpose subsidiary under this chapter. See Indiana Code 27-1-12.1-3
- risk: means a risk:
Indiana Code 27-1-12.1-5
(A) That the proposed organization and operation of the limited purpose subsidiary complies with this chapter.
(B) That the limited purpose subsidiary’s investment policy reflects and considers the liquidity of assets and the reasonable preservation, administration, and management of the assets with respect to the risks associated with reinsurance contracts issued by the limited purpose subsidiary.
(C) That the reinsurance contract and any arrangement intended to secure the limited purpose subsidiary’s obligations under the reinsurance contract (including an agreement to implement the arrangement) comply with this chapter.
(3) File with the commissioner the opinion of a qualified actuary that the methodology and assumptions (including significant stress tests of key assumptions) used to establish reserves held by the limited purpose subsidiary are sufficient to provide for the risk assumed by the limited purpose subsidiary.
(4) File with the commissioner the limited purpose subsidiary’s plan of operation, including the following:
(A) A statement that the limited purpose subsidiary will, before an offer and sale of securities of or by the limited purpose subsidiary, file with the commissioner, in a form acceptable to the commissioner, a legal opinion that the offering and sale of securities:
(i) of the limited purpose subsidiary complies with all federal securities laws; and
(ii) by the limited purpose subsidiary complies with all Indiana securities laws.
For purposes of this clause, the issuance of stock by the limited purpose subsidiary to the organizing domestic life insurance company is not the offer and sale of securities requiring a legal opinion.
(B) A complete description of the material terms of all proposed reinsurance transactions, reinsurance security arrangements, securitizations, and any other material transactions or arrangements of the limited purpose subsidiary.
(C) A description of the source and form of the limited purpose subsidiary’s capital and surplus.
(D) The investment policy of the limited purpose subsidiary.
(E) Pro forma balance sheets and income statements that illustrate at least one (1) adverse case scenario, as determined using criteria required by the commissioner, for the performance of the limited purpose subsidiary under all reinsurance contracts.
(F) Policies for payment of dividends and other distributions to the organizing domestic life insurance company.
(G) Copies of all contracts between the limited purpose subsidiary and affiliates.
(H) Other documentation or information required by the commissioner.
(5) Obtain from the commissioner a certificate of authority to engage in the business of reinsurance in Indiana.
As added by P.L.11-2011, SEC.7. Amended by P.L.115-2011, SEC.2.