Terms Used In N.Y. Insurance Law 5905

• 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
• 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
• 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
• State: means any state of the United States or the District of Columbia. See N.Y. Insurance Law 5902
• Statute: A law passed by a legislature.