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ArkansasSB2362025 Regular SessionSenate

TO AMEND THE INSURANCE HOLDING COMPANY REGULATORY ACT.

Sponsored By: Justin Boyd (Republican), Trey Steimel (Republican)

Enacted

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Bill Overview

Analyzed Economic Effects

6 provisions identified: 1 benefits, 0 costs, 5 mixed.

Insurer financial reports receive privacy protections

Group capital calculations, capital ratios, and liquidity stress test information sent to the Arkansas Insurance Department are confidential. The protection also covers related disclosures and specified information received from other group supervisors. The Commissioner can still use this information in regulatory or legal actions while carrying out official duties.

Stronger safeguards for troubled insurers' assets

When an insurer faces financial danger, the Commissioner can require necessary deposits or bonds for transactions with related companies. Security cannot exceed one year's transaction value and can last through the transaction or until the danger ends. Related companies must keep insurer funds and records under insurer ownership and control, with records separable at no insurer cost. At the insurer's request, they must give its receiver access to records, servers, and software and waive liens blocking access after default. Court-appointed officials can enforce essential service contracts; fund offsets in receivership follow Arkansas law, and related companies must limit unrelated data use.

Insurer groups face annual capital reporting

The top controller of a registered insurer must file an annual group capital calculation with the lead state regulator. It is due with registration and must follow national insurance regulator instructions. Exemptions cover single-insurer groups operating only in their home state and accepting no business from another insurer. Other exemptions cover accessible Federal Reserve calculations and qualifying foreign supervision; regulators can require U.S. operations reports or allow limited filings. Groups losing an exemption must file by their next annual deadline unless extended; late registration, registration summaries, and enterprise risk filings violate the law.

Insurer subsidiaries gain freedom with limits

Arkansas insurers can form or buy subsidiaries that conduct any business allowed by state law. Investments generally cannot exceed the lower of 10% of insurer assets or 50% of policyholder surplus. This limit counts purchase costs and later contributions, and the insurer must keep enough surplus to cover its needs. Asset-holding subsidiaries have separate rules that limit combined direct and indirect investments; specified insurer and health maintenance organization investments are excluded. The Commissioner can approve larger investments when the insurer keeps adequate surplus.

Insurers face cash stress reporting rules

Controllers of covered insurer groups must file yearly stress test results showing how insurers handle cash pressures. Filings go to the lead state regulator using national insurance regulator instructions and templates. Meeting one scope threshold generally brings an insurer into testing; the lead regulator can decide otherwise after consultation. Scope is reviewed at least annually, and adopted changes take effect January 1 of the following year. The usual exclusion for transactions worth 0.5% or less of admitted assets does not apply to capital calculations or liquidity tests.

New review rules for insurer takeovers

The law changes the Commissioner's review of mergers and takeovers involving Arkansas domestic insurers. The Commissioner need not apply two specified information requirements during this review. The Commissioner cannot disapprove a transaction that meets the exceptions in Arkansas Code § 23-63-528(c). Approval can require the buyer to remove a reason for rejection within a set period.

Sponsors & Cosponsors

Sponsors

  • Justin Boyd

    Republican • Senate

  • Trey Steimel

    Republican • House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 130 • No: 0

House vote • 3/10/2025

House Vote - Monday, March 10, 2025 2:59:13 PM

Yes: 98 • No: 0

Senate vote • 2/24/2025

Senate Vote - Monday, February 24, 2025 2:19:20 PM

Yes: 32 • No: 0

Actions Timeline

  1. Notification that SB236 is now Act 261

    3/12/2025Senate

  2. DELIVERED TO GOVERNOR.

    3/11/2025Senate

  3. Reported correctly enrolled and ordered delivered to the Governor.

    3/11/2025Senate

  4. ORDERED ENROLLED

    3/10/2025Senate

  5. Returned from the House as passed.

    3/10/2025Senate

  6. Returned to the Senate as passed.

    3/10/2025House

  7. Read the third time and passed and ordered transmitted to the Senate.

    3/10/2025House

  8. Returned by the Committee Do Pass

    3/5/2025House

  9. Read the first time, rules suspended, read the second time and referred to the Committee on INSURANCE & COMMERCE- HOUSE

    2/24/2025House

  10. RECEIVED FROM THE SENATE

    2/24/2025House

  11. Ordered immediately transmitted to the House.

    2/24/2025Senate

  12. Read the third time and passed.

    2/24/2025Senate

  13. Returned by the Committee, with the recommendation that it Do Pass

    2/20/2025Senate

  14. Read first time, rules suspended, read second time, referred to INSURANCE & COMMERCE - SENATE

    2/17/2025Senate

  15. Filed

    2/14/2025Senate

Bill Text

  • SB236 - Introduced

    2/14/2025

    PDF

  • Act Version

    PDF

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