Terms Used In N.Y. Insurance Law 5904

• Commissioner: means the commissioner, director or superintendent of financial services in any other state. See N.Y. Insurance Law 5902
• Contract: A legal written agreement that becomes binding when signed.
• Financially impaired: means a risk retention group:
  
  (1) whose admitted assets are less than the sum of its aggregate liabilities and the amount of surplus to policyholders required to be maintained by a domestic risk retention group authorized to do the same kind or kinds of insurance; or
  
  (2) whose admitted assets are less than the sum of its aggregate liabilities and outstanding capital stock; or
  
  (3) which is insolvent. See N.Y. Insurance Law 5902
• Hazardous financial condition: means that, based on its present or reasonably anticipated financial condition, a risk retention group, although not yet financially impaired, is unlikely to be able:
  
  (1) to meet obligations to policyholders with respect to known claims and reasonably anticipated claims; or
  
  (2) to pay other obligations in the normal course of business. See N.Y. Insurance Law 5902
• Injunction: An order of the court prohibiting (or compelling) the performance of a specific act to prevent irreparable damage or injury.
• Insurance: means primary insurance, excess insurance, reinsurance, excess line insurance, and any other arrangement for shifting and distributing risk which is determined to be insurance under the laws of this state. See N.Y. Insurance Law 5902
• Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
• Liability: means legal liability for damages (including costs of defense, legal costs and fees, and other claims expenses) because of injuries to other persons, damage to their property, or other damage or loss to such other persons resulting from or arising out of:
  
  (1) (A) any business (whether profit or nonprofit), trade, product, services (including professional services), premises, or operations; or
  
  (B) any activity of any state or local government, or any agency or political subdivision thereof; and
  
  (2) does not include personal risk liability and an employer's liability with respect to its employees other than legal liability under the Federal Employers' Liability Act (45 U. See N.Y. Insurance Law 5902
• Plan of operation or feasibility study: means an analysis which presents the expected activities and results of a risk retention group making application to become chartered and licensed as a domestic property/casualty insurer in this state, including at least the following:
  
  (1) information sufficient to verify that its members are engaged in businesses or activities similar or related with respect to the liability to which such members are exposed by virtue of any related, similar, or common business, trade, product, services, premises or operations;
  
  (2) for each state in which it intends to operate, the coverages, deductibles, coverage limits, rates, and rating classification systems for each kind of insurance the group intends to offer;
  
  (3) historical and expected loss experience of the proposed members and national experience of similar exposures to the extent that this experience is reasonably available;
  
  (4) pro forma financial statements and projections;
  
  (5) appropriate opinions by a qualified, independent casualty actuary, including a determination of minimum premium or participation levels required to commence operations and to prevent the development of a hazardous financial condition;
  
  (6) identification of management, underwriting and claims procedures, marketing methods, managerial oversight methods, investment policies and reinsurance agreements;
  
  (7) identification of each state in which the risk retention group has obtained, or sought to obtain, a charter and license, and a description of its status in each state; and
  
  (8) such other matters as may be prescribed by the commissioner of the state in which the risk retention group is chartered for liability insurance companies authorized by the insurance laws of the state. See N.Y. Insurance Law 5902
• Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. ^{Source: OCC}
• Risk retention group: means any corporation or other limited liability association formed pursuant to the federal liability risk retention act of 1986:
  
  (1) whose primary activity consists of assuming and spreading all, or any portion, of the liability exposure of its group members;
  
  (2) which is organized for the primary purpose of conducting the activity described under paragraph one of this subsection;
  
  (3) which:
  
  (A) is chartered and licensed as a liability insurance company and authorized to engage in the business of insurance under the laws of any state; or
  
  (B) before January first, nineteen hundred eighty-five, was chartered or licensed and authorized to engage in the business of insurance under the laws of Bermuda or the Cayman Islands and, before such date, had certified to the insurance commissioner of at least one state that it satisfied the capitalization requirements of such state, except that any such group shall be considered to be a risk retention group only if it has been engaged in business continuously since such date and only for the purpose of continuing to provide insurance to cover product liability or completed operations liability;
  
  (4) which does not exclude any person from membership in the group solely to provide for members of such a group a competitive advantage over such a person;
  
  (5) which:
  
  (A) has as its owners only persons who comprise the membership of the risk retention group and who are provided insurance by such group; or
  
  (B) has as its sole owner an organization which has as its members only persons who comprise the membership of the risk retention group and which organization has as its owners only persons who comprise the membership of the risk retention group and who are provided insurance by the risk retention group;
  
  (6) whose members are engaged in businesses or activities similar or related with respect to the liability of which such members are exposed by virtue of any related, similar, or common business trade, product, services, premises or operations;
  
  (7) whose activities do not include the provision of insurance other than:
  
  (A) liability insurance for assuming and spreading all or any portion of the liability of its group members; and
  
  (B) reinsurance with respect to the liability of any other risk retention group (or any member of such other risk retention group) which is engaged in businesses or activities which meet the requirement described in paragraph six of this subsection for membership in the risk retention group which provides such reinsurance; and
  
  (8) the name of which includes the phrase "risk retention group". See N.Y. Insurance Law 5902
• Service of process: The service of writs or summonses to the appropriate party.
• Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
• State: means any state of the United States or the District of Columbia. See N.Y. Insurance Law 5902
• Superintendent: means the superintendent of financial services of this state. See N.Y. Insurance Law 5902