Nebraska Statutes 44-224.05. Domestic nonstock company; bulk reinsurance; contract; approval
(1) Any domestic insurance company operating on other than the stock plan may cede its business to another licensed insurer, whether stock, mutual, assessment, or reciprocal exchange, by a contract of bulk reinsurance upon compliance with this section.
Terms Used In Nebraska Statutes 44-224.05
- Company: shall include any corporation, partnership, limited liability company, joint-stock company, joint venture, or association. See Nebraska Statutes 49-801
- Contract: A legal written agreement that becomes binding when signed.
- Director: shall mean the Director of Insurance. See Nebraska Statutes 44-103
- Domestic: when applied to corporations shall mean all those created by authority of this state. See Nebraska Statutes 49-801
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- Insurer: shall include all companies, exchanges, societies, or associations whether organized on the stock, mutual, assessment, or fraternal plan of insurance and reciprocal insurance exchanges. See Nebraska Statutes 44-103
- Person: shall include bodies politic and corporate, societies, communities, the public generally, individuals, partnerships, limited liability companies, joint-stock companies, and associations. See Nebraska Statutes 49-801
- Reinsurance: shall mean a contract by which an insurer procures a third party to insure it against loss or liability by reason of such original insurance. See Nebraska Statutes 44-103
(2) Such contract of bulk reinsurance shall not become effective unless first filed with and approved by the director and thereafter approved by a majority vote of the members of the ceding company present in person or by proxy and voting at an annual meeting or at a special meeting called for that purpose. The director shall not approve such contract unless he or she finds it to be fair and equitable to the policyholders of each insurer involved. If the director does not so approve, he or she shall notify each insurer involved in writing specifying his or her reasons therefor.
(3) Contracts of bulk reinsurance whereby an insurer operating on other than the stock plan of insurance cedes its business to a stock insurer shall provide for distribution to each policyholder of the ceding company of his or her equity in the surplus funds, if any, of such ceding company as determined under a fair and equitable formula approved by the director.