Utah Code 31A-17-404.1. Asset or reduction from liability for reinsurance ceded by a domestic insurer to other assuming insurers
Current as of: 2024 | Check for updates
|
Other versions
(1)
Terms Used In Utah Code 31A-17-404.1
- Contract: A legal written agreement that becomes binding when signed.
- Domestic insurer: means an insurer organized under the laws of this state. See Utah Code 31A-1-301
- Filing: when used as a noun, means an item required to be filed with the department including:(70)(a) a policy;(70)(b) a rate;(70)(c) a form;(70)(d) a document;(70)(e) a plan;(70)(f) a manual;(70)(g) an application;(70)(h) a report;(70)(i) a certificate;(70)(j) an endorsement;(70)(k) an actuarial certification;(70)(l) a licensee annual statement;(70)(m) a licensee renewal application;(70)(n) an advertisement;(70)(o) a binder; or(70)(p) an outline of coverage. See Utah Code 31A-1-301
- Form: means one of the following prepared for general use:
(74)(a)(i) a policy;(74)(a)(ii) a certificate;(74)(a)(iii) an application;(74)(a)(iv) an outline of coverage; or(74)(a)(v) an endorsement. See Utah Code 31A-1-301- Insurance: includes :
(96)(b)(i) a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;(96)(b)(ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and(96)(b)(iii) a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Reinsurance: means an insurance transaction where an insurer, for consideration, transfers any portion of the risk it has assumed to another insurer. See Utah Code 31A-1-301
- Security: means a:
(176)(a)(i) note;(176)(a)(ii) stock;(176)(a)(iii) bond;(176)(a)(iv) debenture;(176)(a)(v) evidence of indebtedness;(176)(a)(vi) certificate of interest or participation in a profit-sharing agreement;(176)(a)(vii) collateral-trust certificate;(176)(a)(viii) preorganization certificate or subscription;(176)(a)(ix) transferable share;(176)(a)(x) investment contract;(176)(a)(xi) voting trust certificate;(176)(a)(xii) certificate of deposit for a security;(176)(a)(xiii) certificate of interest of participation in an oil, gas, or mining title or lease or in payments out of production under such a title or lease;(176)(a)(xiv) commodity contract or commodity option;(176)(a)(xv) certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase any of the items listed in Subsections (176)(a)(i) through (xiv); or(176)(a)(xvi) another interest or instrument commonly known as a security. See Utah Code 31A-1-301- United States: includes each state, district, and territory of the United States of America. See Utah Code 68-3-12.5
(1)(a) An asset or a reduction from liability for reinsurance ceded by a domestic insurer to an assuming insurer that does not meet the requirements of Section 31A-17-404 is allowed in an amount not exceeding the liabilities carried by the ceding insurer.(1)(b) A reduction described in Subsection (1)(a) shall be in the amount of funds held by or on behalf of the ceding insurer, including funds held in trust for the ceding insurer:(1)(b)(i) that are held:(1)(b)(i)(A) under a reinsurance contract with the assuming insurer; and(1)(b)(i)(B) as security for the payment of obligations under the reinsurance contract; and(1)(b)(ii) if the security is held:(1)(b)(ii)(A) in the United States subject to withdrawal solely by, and under the exclusive control of, the ceding insurer; or(1)(b)(ii)(B) in the case of a trust, in a qualified United States financial institution.(2) Security described in Subsection (1) may be in the form of:(2)(a) cash;(2)(b) a security:(2)(b)(i) listed by the Securities Valuation Office of the National Association of Insurance Commissioners, including those considered exempt from filing as defined by the Purposes and Procedures Manual of the Securities Valuation Office; and(2)(b)(ii) qualifying as an admitted asset;(2)(c) subject to Subsection (3), a clean, irrevocable, unconditional letter of credit, issued or confirmed by a qualified United States financial institution:(2)(c)(i) effective no later than December 31 of the year for which the filing is being made; and(2)(c)(ii) in the possession of, or in trust for, the ceding insurer on or before the filing date of its annual statement; or(2)(d) another form of security acceptable to the commissioner.(3) Notwithstanding an issuing or confirming institution’s subsequent failure to meet an applicable standard of acceptability, a letter of credit described in Subsection (2) that meets the applicable standards of issuer acceptability as of the day on which it is issued or confirmed shall continue to be acceptable as security until the sooner of the day on which the letter of credit expires, is extended, is renewed, is modified, or is amended. - Form: means one of the following prepared for general use: