Title 58, INSURANCE

An assuming insurer under § 58-14-16.23 shall agree in writing to provide adequate assurance to the director, in a form prescribed by the director, as follows: (1) The assuming insurer shall provide prompt written notice and explanation to the director if the assuming insurer fal…

An assuming insurer under § 58-14-16.23 or its legal successor shall provide, if requested by the director, on behalf of itself and any legal predecessors, the following documentation to the director: (1) For the two years preceding entry into the reinsurance agreement and on an …

An assuming insurer under § 58-14-16.23 shall maintain a practice of prompt payment of claims under a reinsurance agreement. The lack of prompt payment is evidenced if any of the following criteria are met: (1) More than fifteen percent of the reinsurance recoverables from the as…

The director shall timely create and publish a list of reciprocal jurisdictions that includes any reciprocal jurisdiction as defined under this chapter. A list of reciprocal jurisdictions is published by the NAIC and the director shall consider any other reciprocal jurisdiction i…

The director shall timely create and publish a list of assuming insurers that have satisfied the conditions set forth in §§ 58-14-16.23 to 58-14-16.34, inclusive, and to which cessions must be granted credit. The director may add an assuming insurer to the list if an NAIC-accredi…

An association including incorporated and individual unincorporated underwriters may be a certified reinsurer. In addition to satisfying the requirements of § 58-14-16.2 , to be eligible for certification: (1) The association shall satisfy the association's minimum capital and su…

If the director determines that an assuming insurer no longer meets a requirement under §§ 58-14-16.23 to 58-14-16.34, inclusive, the director may revoke or suspend the eligibility of the assuming insurer. While an assuming insurer's eligibility is suspended, no reinsurance agree…

Before denying statement credit or imposing a requirement to post security under § 58-14-16.30 or adopting any similar requirement that will have substantially the same regulatory impact as security, the director shall: (1) Communicate with the ceding insurer, the assuming insure…

If subject to a legal process of rehabilitation, liquidation, or conservation, the ceding insurer or its representative may seek and, if determined appropriate by the court in which the proceedings are pending, obtain an order requiring that the assuming insurer post security for…

Credit may be taken under §§ 58-14-16.23 to 58-14-16.34, inclusive, only for reinsurance agreements entered into, amended, or renewed on or after July 1, 2021, and only with respect to losses incurred and reserves reported on or after the later of the date on which the assuming i…

Nothing in §§ 58-14-16.23 to 58-14-16.34 , inclusive: (1) Limits or in any way alters the capacity of parties to a reinsurance agreement to agree on requirements for security or other terms in that reinsurance agreement except as expressly prohibited by this chapter or other appl…

The director shall create and publish a list of qualified jurisdictions, under which an assuming insurer licensed and domiciled in the jurisdiction is eligible to be considered for certification by the director as a certified reinsurer. If a certified reinsurer's domiciliary juri…

To determine whether the domiciliary jurisdiction of a non-United States assuming insurer is eligible to be recognized as a qualified jurisdiction, the director shall evaluate the appropriateness and effectiveness of the reinsurance supervisory system of the jurisdiction, both in…

A list of qualified jurisdictions shall be published through the National Association of Insurance Commissioners. The director shall consider the list in determining qualified jurisdictions. If the director approves a jurisdiction as qualified that does not appear on the list of …

The director shall assign a rating to each certified reinsurer, giving due consideration to the financial strength ratings that have been assigned by rating agencies deemed acceptable to the director. The director shall publish a list of all certified reinsurers and their ratings…

A certified reinsurer shall secure obligations assumed from United States ceding insurers under §§ 58-14-16.9 to 58-14-16.13 , inclusive, at a level consistent with the certified reinsurer's rating. The director may promulgate rules, pursuant to chapter 1-26 , to establish standa…

In order for a domestic ceding insurer to qualify for full financial statement credit for reinsurance ceded to a certified reinsurer, the certified reinsurer shall maintain security in a form acceptable to the director and consistent with § 58-14-16 , or in a multibeneficiary tru…

The director may promulgate rules, pursuant to chapter 1-26 , concerning requirements, qualifications, and criteria for receiving credit for reinsurance, surplus amounts, accreditation of a reinsurer, certification of a reinsurer, minimum levels for reinsurer capital and surplus,…

This section applies to all cessions after July 1, 1993, under reinsurance agreements which have had an inception, anniversary, or renewal date not less than six months after July 1, 1993. Source: SL 1992, ch 344 , § 12.

For the purposes of this chapter, the term, substantially similar, means standards which equal or exceed the standards of this state. Source: SL 1992, ch 344 , § 17.

The director may not allow a credit or deduction to the ceding insurer if the director determines the quality, quantity, or diversity of investments in the trust account of a reinsurer or the surplus to policyholders of the reinsurer is hazardous to a ceding insurer or policyhold…

A reinsurer is an insurer that assumes all or part of the insurance or reinsurance written by another insurer and which meets the requirements of this chapter. The director may examine a reinsurer pursuant to chapter 58-3 and costs shall be assessed pursuant to that chapter. Sour…

The requirements of this chapter do not apply to a domestic insurer reinsuring companies pursuant to chapter 58-35 . Source: SL 1992, ch 344 , § 20.

A qualified United States financial institution means, for purposes of those provisions of this chapter specifying those institutions that are eligible to act as a fiduciary of a trust, an institution that: (1) Is organized or, in the case of a United States branch or agency offi…

Terms used in §§ 58-14-24 to 58-14-42 , inclusive, mean: (1) "Actuary," any person who is a member in good standing of the American Academy of Actuaries; (2) "Controlling person," any person who, directly or indirectly, has the power to direct or cause to be directed the manageme…

The following persons are not agents: (1) Any employee of the reinsurer; (2) Any United States manager of the United States branch of an alien reinsurer; (3) Any underwriting manager who, pursuant to contract, manages all the reinsurance operations of the reinsurer, is under comm…

No person may sell, solicit, negotiate, or place reinsurance without being licensed pursuant to §§ 58-14-24 to 58-14-42 , inclusive, to sell, negotiate, solicit, or place reinsurance. The provisions of chapter 58-30 apply to the extent that the provisions are not inconsistent wit…

The director may require an agent or broker under §§ 58-14-24 to 58-14-42 , inclusive, to file a bond in an amount acceptable to the director for the protection of the reinsurer or maintain an errors and omissions policy in an amount acceptable to the director, or both. Source: S…

The director may refuse to license an agent or broker in reinsurance if the applicant, any one named on the application, or any member, principal, officer or director of the applicant, is not trustworthy; if any controlling person of the applicant is not trustworthy; if there has…

Any transaction between an agent or broker and the insurer or reinsurer that it represents may only be entered into pursuant to a written contract, specifying the responsibilities of each party. The contract shall, at a minimum, provide that: (1) The insurer or reinsurer may term…

An insurer may only reinsure risks within the limits it is authorized to insure. Source: SL 1966, ch 111 , ch 4, § 10 (1); SL 1992, ch 344 , § 14.

For at least ten years after expiration of each contract of reinsurance transacted by the agent or broker, the agent or broker shall keep a complete record for each transaction showing: (1) The type of contract, limits, underwriting restrictions, classes or risks, and territory; …

No insurer or reinsurer may engage the services of any person to act as an agent or broker on its behalf unless the person is licensed as required by §§ 58-14-24 to 58-14-42 , inclusive, nor employ an individual who is employed by an agent or broker with which it transacts busine…

The written contract with the agent, pursuant to § 58-14-29 , specifying the responsibilities of each party, shall be approved by the reinsurer's board of directors. At least thirty days before the insurer or reinsurer assumes or cedes business through the agent or broker, the co…

In addition to standards set forth in § 58-14-29 , the contract shall provide: (1) That the reinsurer and insurer shall have access and the right to copy and audit all accounts and records maintained by the agent or broker related to its business in a form usable by the insurer a…

If the contract permits the agent or broker to settle claims on behalf of the reinsurer, the contract shall state the claims shall be handled as follows: (1) All claims shall be reported to the reinsurer in a timely manner; (2) A copy of the claim file shall be sent to the reinsu…

The agent may not: (1) Cede retrocessions on behalf of the reinsurer. However, the agent or broker may cede facultative retrocessions pursuant to obligatory facultative agreements if the contract with the reinsurer contains reinsurance underwriting guidelines for the retrocession…

If an agent or broker establishes loss reserves, the reinsurer shall annually obtain the opinion of an actuary attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the agent. This opinion shall be in addition to any ot…

Any person doing business as an agent or broker under §§ 58-14-24 to 58-14-42 , inclusive, is subject to examination by the director. The director shall have access to all books, bank accounts and records of the person in a form usable to the director. Any person contracting with…

Any agent or broker, insurer or reinsurer found by the director, after a hearing conducted in accordance with chapter 1-26 , to be in violation of any provision of §§ 58-14-24 to 58-14-42 , inclusive, shall: (1) For each separate violation, pay a penalty in an amount not exceedin…

Nothing contained in §§ 58-14-24 to 58-14-42 , inclusive, limits or restricts the rights of policyholders, claimants, creditors, or other third parties or confer any rights to those persons. Source: SL 1992, ch 345 , § 16.

No credit may be allowed, as an asset or as a deduction from liability, to any ceding insurer for reinsurance unless the reinsurance contract provides, in substance, that in the event of the insolvency of the ceding insurer, the reinsurance is payable under a contract reinsured b…

Notwithstanding § 58-14-4 , if a life and health insurance guaranty association has made the election to succeed to the rights and obligations of the insolvent insurer under the contract of reinsurance, the reinsurer's liability to pay covered reinsured claims continues under the…

The reinsurance agreement may provide that the domiciliary liquidator of an insolvent ceding insurer shall give written notice to the reinsurer of the pendency of a claim against such ceding insurer on the contract reinsured within a reasonable time after such claim is filed in t…

The director may adopt rules pursuant to chapter 1-26 for the implementation and administration of the provisions of §§ 58-14-24 to 58-14-42 , inclusive. Source: SL 1992, ch 345 , § 17.

No insurer or reinsurer may continue to do business with an agent or broker negotiating, selling, placing or soliciting reinsurance after July 1, 1993, unless the agent or broker is in compliance with §§ 58-14-24 to 58-14-42 , inclusive. Sections 58-14-24 to 58-14-42 , inclusive,…