mercial property insurance or commercial 
casualty insurance: 
(I) Risk financing. 
(II) Claims administration. 
(III) Loss prevention. 
(IV) Risk and insurance coverage 
analysis. 
(iii) At least one of the following des-
ignations: 
(I) A designation as a Chartered 
Property and Casualty Underwriter 
(in 
this 
clause 
referred 
to 
as 
‘‘CPCU’’) issued by the American In-
stitute for CPCU/Insurance Institute 
of America. 
(II) A designation as an Asso-
ciate in Risk Management (ARM) 
issued by American Institute for 
CPCU/Insurance Institute of America. 
(III) A designation as a Certified 
Risk Manager (CRM) issued by the 
National Alliance for Insurance Edu-
cation & Research.
(IV) A designation as a RIMS 
Fellow (RF) issued by the Global Risk 
Management Institute. 
(V) Any other designation, cer-
tification, or license determined by a 
State insurance commissioner or other 
State insurance regulatory official or 
entity to demonstrate minimum com-
petency in risk management. 
(10) PREMIUM TAX.—The term ‘‘premium tax’’ 
means, with respect to surplus lines or independently 
procured insurance coverage, any tax, fee, assess-
ment, or other charge imposed by a State on an in-
sured based on any payment made as consideration 
for an insurance contract for such insurance, includ-
ing premium deposits, assessments, registration fees, 
and any other compensation given in consideration 
for a contract of insurance. 
(11) SURPLUS LINES BROKER.—The term ‘‘sur-
plus lines broker’’ means an individual, firm, or cor-
poration which is licensed in a State to sell, solicit, 
or negotiate insurance on properties, risks, or expo-
sures located or to be performed in a State with 
nonadmitted insurers.
(12) STATE.—The term ‘‘State’’ includes any 
State of the United States, the District of Columbia, 
the Commonwealth of Puerto Rico, Guam, the 
Northern Mariana Islands, the Virgin Islands, and 
American Samoa. 
TITLE II—REINSURANCE 
SEC. 201. REGULATION OF CREDIT FOR REINSURANCE AND 
REINSURANCE AGREEMENTS. 
(a) CREDIT
FOR REINSURANCE.—If the State of 
domicile of a ceding insurer is an NAIC-accredited State, 
or has financial solvency requirements substantially simi-
lar to the requirements necessary for NAIC accreditation, 
and recognizes credit for reinsurance for the insurer’s 
ceded risk, then no other State may deny such credit for 
reinsurance. 
(b) 
ADDITIONAL
PREEMPTION
OF 
EXTRATERRITORIAL APPLICATION OF STATE LAW.—In 
addition to the application of subsection (a), all laws, regu-
lations, provisions, or other actions of a State other than 
those of the State of domicile of the ceding insurer are 
preempted to the extent that they—
(1) restrict or eliminate the rights of the ceding 
insurer or the assuming insurer to resolve disputes 
pursuant to contractual arbitration to the extent
such contractual provision is not inconsistent with 
the provisions of title 9, United States Code; 
(2) require that a certain State’s law shall gov-
ern the reinsurance contract, disputes arising from 
the reinsurance contract, or requirements of the re-
insurance contract; 
(3) attempt to enforce a reinsurance contract 
on terms different than those set forth in the rein-
surance contract, to the extent that the terms are 
not inconsistent with this title; or 
(4) otherwise apply the laws of the State to re-
insurance agreements of ceding insurers not domi-
ciled in that State. 
SEC. 202. REGULATION OF REINSURER SOLVENCY. 
(a) DOMICILIARY STATE REGULATION.—If the State 
of domicile of a reinsurer is an NAIC-accredited State or 
has financial solvency requirements substantially similar 
to the requirements necessary for NAIC accreditation, 
such State shall be solely responsible for regulating the 
financial solvency of the reinsurer. 
(b) NONDOMICILIARY STATES.—
(1) LIMITATION ON FINANCIAL INFORMATION 
REQUIREMENTS.—If the State of domicile of a rein-
surer is an NAIC-accredited State or has financial 
solvency requirements substantially similar to the re-
quirements necessary for NAIC accreditation, no 
other State may require the reinsurer to provide any 
additional financial information other than the infor-
mation the reinsurer is required to file with its 
domiciliary State. 
(2) RECEIPT OF INFORMATION.—No provision 
of this section shall be construed as preventing or 
prohibiting a State that is not the State of domicile 
of a reinsurer from receiving a copy of any financial 
statement filed with its domiciliary State. 
SEC. 203. DEFINITIONS. 
For purposes of this title, the following definitions 
shall apply: 
(1) CEDING INSURER.—The term ‘‘ceding in-
surer’’ means an insurer that purchases reinsurance. 
(2) DOMICILIARY STATE.—The terms ‘‘State of 
domicile’’ and ‘‘domiciliary State’’ means, with re-
spect to an insurer or reinsurer, the State in which 
the insurer or reinsurer is incorporated or entered 
through, and licensed. 
(3) REINSURANCE.—The term ‘‘reinsurance’’ 
means the assumption by an insurer of all or part 
of a risk undertaken originally by another insurer. 
(4) REINSURER.—
(A) IN GENERAL.—The term ‘‘reinsurer’’ 
means an insurer to the extent that the in-
surer—
(i) is principally engaged in the busi-
ness of reinsurance; 
(ii) does not conduct significant 
amounts of direct insurance as a percent-
age of its net premiums; and 
(iii) is not engaged in an ongoing 
basis in the business of soliciting direct in-
surance. 
(B) DETERMINATION.—A determination of 
whether an insurer is a reinsurer shall be made 
under the laws of the State of domicile in ac-
cordance with this paragraph. 
(5) STATE.—The term ‘‘State’’ includes any 
State of the United States, the District of Columbia, 
the Commonwealth of Puerto Rico, Guam, the 
Northern Mariana Islands, the Virgin Islands, and 
American Samoa. 
TITLE III—RULE OF 
CONSTRUCTION 
SEC. 301. RULE OF CONSTRUCTION. 
Nothing in this Act or amendments to this Act shall 
be construed to modify, impair, or supersede the applica-
tion of the antitrust laws. Any implied or actual conflict 
between this Act and any amendments to this Act and 
the antitrust laws shall be resolved in favor of the oper-
ation of the antitrust laws. 
Passed the House of Representatives September 27, 
2006. 
Attest:
Clerk.
109TH CONGRESS 
2D SESSION 
H. R. 5637
AN ACT 
To streamline the regulation of nonadmitted 
insurance and reinsurance, and for other purposes.