justicedao/ipfs_state_laws huggingface dataset:
410-141-5035 FINANCIAL SOLVENCY REGULATION: Accountant's Letter of Qualifications (1) An accountant shall furnish the CCO, in connection with and for inclusion in the filing of the annual audited financial report, a letter stating the following: (a) That the accountant is independent with respect to the CCO and conforms to the standards of the accounting profession as contained in the Code of Professional Ethics and pronouncements of the AICPA and the Rules of Professional Conduct of the Oregon State Board of Accountancy, or a similar code of conduct of the state board regulating the practice of accountancy in the state in which the accountant is licensed to practice. (b) The background and experience in general, and the experience in audits of CCOs, of the staff assigned to the engagement and whether each is an independent certified public accountant. (c) That the accountant understands that the annual audited financial report and the opinion of the accountant thereon must be filed in compliance with OAR 410-141-5020 and that the Authority will rely on the information contained in the report and opinion in the monitoring and regulation of the financial position of CCOs. (d) That the accountant consents to the requirements of OAR 410-141-5020 and that the accountant agrees to make the workpapers described in OAR 410-141-5040 available for review by the Authority, or the Authority's designee or appointed agent. (e) A representation that the accountant is currently licensed by an appropriate state licensing authority and is a member in good standing in the American Institute of Certified Public Accountants. (f) A representation that the accountant is in compliance with OAR 410-141-5025. (2) This section does not prohibit an independent certified public accountant from using such staff as the accountant determines appropriate when use of the staff is consistent with the standards prescribed by generally accepted auditing standards. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5040 FINANCIAL SOLVENCY REGULATION: Independent Certified Public Accountants Workpapers (1) For the purpose of this section, workpapers are the records kept by an independent certified public accountant of the procedures followed, the tests performed, the information obtained and the conclusions reached pertinent to the accountant's audit of the financial statements of a CCO. Accordingly, workpapers may include audit planning documentation, work programs, analyses, memoranda, letters of confirmation and representation, abstracts of company documents and schedules or commentaries prepared or obtained by the independent certified public accountant in the course of the accountant’s audit of the financial statements of a CCO and which support the accountant's opinion. (2) A CCO that is required to file an audited financial report pursuant to OAR 410-141-5020 shall require the accountant to make available for review by the Authority, all workpapers prepared in the conduct of the accountant’s audit and any communications related to the audit between the accountant and the CCO, at the offices of the CCO, at the Authority’s offices or at any other reasonable place designated by the Authority. The CCO shall require that the accountant retain the audit workpapers and communications until the Authority has filed a report on examination covering the period of the audit but no longer than seven years from the date of the audit report. (3) In the conduct of a periodic review by the Authority’s examiners, the Authority may make and retain photocopies of pertinent audit workpapers. Any such review by the Authority’s examiners is an investigation and all working papers and communications obtained during the course of such an investigation must be given the same confidentiality as other examination workpapers generated by the Authority. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5055 FINANCIAL SOLVENCY REGULATION: Requirements for Obtaining Credit for Reinsurance (1) The Authority shall not allow financial statement credit for reinsurance to a cedent CCO as either an asset or a reduction from liability on account of reinsurance ceded unless the reinsurance meets the requirements of subsection (2) or (3) of this section. (2) Credit shall be allowed when the reinsurance is ceded to an authorized assuming CCO or an authorized health insurer that has been approved and accepted by the Authority to act as a reinsurer of the cedent CCO in accordance with OAR 410-141-5050. The Authority shall not allow credit to a cedent CCO if the approval or acceptance of the reinsurer has been revoked by the Authority after notice and opportunity for hearing. (3) The Authority shall allow a reduction from liability for reinsurance ceded by a CCO to an assuming reinsurer not meeting the requirements of subsection (2) in an amount not exceeding the liabilities carried by the cedent CCO. The reduction shall be in the amount of funds held by or on behalf of the cedent CCO, including funds held in trust for the exclusive benefit of the cedent CCO, under a reinsurance contract with such reinsurer as security for the payment of obligations under the reinsurance contract. The security must be held in the United States subject to withdrawal solely by and under the exclusive control of the cedent CCO insurer or, in the case of a trust, held in a Qualified United States Financial Institution. The security may be in the form of any of the following: (a) Cash. (b) Securities listed by the SVO. (c) Clean, irrevocable, unconditional and "evergreen" letters of credit issued or confirmed by a Qualified United States Financial Institution effective no later than December 31 of the year for which filing is being made, and in the possession of, or in trust for, the cedent CCO on or before the filing date of its annual statement. Letters of credit meeting applicable standards of issuer acceptability as of the dates of their issuance or confirmation shall, notwithstanding the issuing or confirming institution's subsequent failure to meet applicable standards of issuer acceptability, continue to be acceptable as security until their expiration, extension, renewal, modification or amendment, whichever first occurs. (d) Any other form of security acceptable to the Authority. (4) An allowed asset or a reduction from liability for reinsurance ceded to an unauthorized reinsurer pursuant to subsection (3) of this section shall be allowed only when the applicable requirements of OAR 410-141-5050 to OAR 410-141-5070 are satisfied. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5075 FINANCIAL SOLVENCY REGULATION: Disallowance of Certain Reinsurance Transactions (1) The Authority shall disallow as an asset or as a credit against liabilities any reinsurance found by the Authority to have been arranged for the purpose principally of deception as to the ceding CCO’s financial condition as of the date of any financial statement of the CCO. A CCO shall follow the process for approval outlined in the CCO Contract. (2) Without limiting the significance of the subsection (1), reinsurance of any substantial part of the CCO’s outstanding risks placed within four months prior to the date of any such financial statement and canceled in fact within eight months after the date of such statement, or reinsurance under which the reinsurer bears no substantial insurance risk or substantial risk of net loss to itself, shall be deemed to have been arranged for the principal purpose of deception. (3) The Authority shall disallow as an asset any deposit, funds or other assets of the CCO found by the Authority: (a) Not to be the property of the CCO; (b) Not freely subject to withdrawal or liquidation by the CCO at any time for the payment or discharge of claims or other obligations arising under its CCO Contracts; or (c) To result from arrangements made principally for the purpose of deception as to the CCO’s financial condition as of the date of any financial statement of the CCO. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5090 ASSET VALUATION AND PERMITTED INVESTMENTS: Calculation of Value; Books and Records (1) Securities held by a CCO, other than bonds or other evidences of debt to which OAR 410-141-5095, applies, must be valued in the discretion of the Authority at their market value, at their appraised value or at prices determined by the Authority as representing their fair market value. (2) Preferred or guaranteed stocks or shares while paying full dividends may be carried at a fixed value instead of market value, at the discretion of the Authority and in accordance with any method of valuation approved by the Authority. (3) Stock of a subsidiary corporation of a CCO may not be valued at an amount in excess of the net value thereof as based upon the assets only of the subsidiary that would be eligible under OAR 410-141-5095 to 410-141-5140 for investment of the funds of the CCO directly. (4) The Authority may determine the method of calculating values as provided in this section, but the method or valuation may not be inconsistent with any applicable method or valuation used by CCOs in general or any such method of valuation then currently formulated or approved by the NAIC or its successor organization. (5) Assets may be allowed as deductions from corresponding liabilities, liabilities may be charged as deductions from assets, deductions from assets may be charged as liabilities, and deductions from liabilities may be allowed as assets, in accordance with the form of annual statement prescribed by the Authority, or otherwise in the discretion of the Authority. (6) A CCO shall keep its books, records, accounts and transaction source data in such manner that the Authority may readily verify its statements of financial condition and ascertain whether the CCO is unimpaired, has given proper treatment to Members and has complied with state and federal law. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5100 ASSET VALUATION AND PERMITTED INVESTMENTS: Investments Used to Provide Compensating Balances Investments of a CCO of the kind described in OAR 410-141-5105(2) that are made for the purpose of providing compensating balances for other persons will not be prohibited by OAR 410-141-5140 while the following conditions are met: (1) The investment is made in the name of and remains the sole property of the CCO; (2) The investment is not subject to appropriation in any manner by any person, including the person for whom the compensating balance is being provided, the institution in which the deposit is made and other creditors of such persons; (3) The CCO holds an irrevocable written waiver from the depositary institution, in a form satisfactory to the Authority, waiving all right, title and interest in or to any setoff, banker's or similar lien or other security interest in such investment or any funds represented thereby; (4) The investment is unrestricted as to right of withdrawal except for such restrictions as may be usual and customary for such investments under OAR 410-141-5105(2) when no compensating balance is involved; and (5) The CCO receives a reasonable fee, taking into consideration its return on other funds, for providing the compensating balance involved. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5105 ASSET VALUATION AND PERMITTED INVESTMENTS: Investment of Required Capitalization (1) Funds of a CCO at least equal to its required capitalization shall be invested and kept invested as follows: (a) In amply secured obligations of the United States, a state or a political subdivision of this state. (b) In loans secured by first liens upon improved, unencumbered real property (other than leaseholds) in this state where: (A) The lien does not exceed 50 percent of the appraised value of the property and the loan is for a term of five years or less; (B) The lien does not exceed 66-2/3 percent of the appraised value of the property provided there is an amortization plan mortgage, deed of trust or other instrument under the terms of which the installment payments are sufficient to repay the loan within a period of not more than 25 years; or (C) The investment is insured or guaranteed by the Federal Housing Administration, the United States Department of Veterans Affairs, or under Title I of the Housing Act of 1949 (providing for slum clearance and redevelopment projects) enacted by Congress on July 15, 1949. (2) In deposits, certificates of deposit, deposit accounts, savings accounts, or certificate shares or accounts of or in banks, trust companies, savings and loan associations or building and loan associations to the extent such investments are insured by the Federal Deposit Insurance Corporation. (3) Investments made pursuant to this section shall be kept free of any lien or pledge. The term “lien or pledge” as used in this section shall not include a deposit of securities with a sovereign, nor assets held in trust for the benefit or protection of all or any class of policyholders of a CCO. (4) Funds of a CCO may be invested in amply secured obligations of a sovereign, political subdivision thereof or corporation. Expressly included, but not by way of limitation, are obligations of the following federal agencies and authorities: Federal Home Loan Banks, Federal Land Banks, Home Owners Loan Corporation, Public Housing Authorities (to the extent that such obligations are secured by a pledge of annual contributions to be paid by the United States or an agency thereof), and Federal Intermediate Credit Banks. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5120 ASSET VALUATION AND PERMITTED INVESTMENTS: Investment in Corporate Stocks (1) Funds of a CCO may be invested in stocks (including trust certificates) of solvent corporations organized and carrying on a business under the laws of a sovereign as follows: (a) Preferred or guaranteed stocks if the corporation is not in default or arrears as to any preferred or guaranteed dividend and has continuously and regularly paid such dividends during the preceding three years or has paid cash dividends for five years on common stock. (b) Common stocks as provided in paragraph (c) of this subsection if: (A) The obligations and preferred stock, if any, of such corporation are eligible for investment under these rules; and (B) The stock is registered on a national securities exchange regulated under the Securities Exchange Act of 1934, 15 U.S.C. §§ 78a et seq., or if of a type not commonly so registered is regularly traded on a broad national or regional basis. (C) Notwithstanding OAR 410-141-5165(1), not more than twenty five percent of admitted assets may be in common stocks that have not paid a cash dividend during each of the five years preceding the date of acquisition. (2) A CCO shall not invest so as to own or control more than five percent of the voting power outstanding of a corporation, nor shall it invest in the obligations or stocks of a corporation if the CCO and its directors, trustees and officers own or control, or as a result thereof shall own and control, in the aggregate more than 50 percent of the voting power. This subsection does not apply to limit the amount of a CCO’s assets that may be invested in the voting securities of a depository institution or any company that controls the depository institution. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 58-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5125 ASSET VALUATION AND PERMITTED INVESTMENTS: Loans; Security; Limitations (1) Funds of a CCO may be invested in loans secured by pledges of obligations and stocks eligible for investment under these rules. As of the date the loan is made, it shall not exceed in amount eighty percent of the market value of the collateral pledged. No such loan shall be made for the purpose of providing funds to purchase or carry stocks registered on a national securities exchange. (2) Funds of a CCO may be invested in loans secured by personal property or fixtures if such loan is: (a) In connection with a loan on the security of real property or a leasehold as provided in OAR 410-141-5110; (b) In an amount not exceeding twenty percent of the amount loaned on the real property or leasehold; (c) For a term of not more than five years; (d) Secured by a security interest which constitutes a first lien, except for taxes not then delinquent, on tangible, permanent personal property of the borrower kept and used on the premises, other than stocks of goods held for sale or transfer in the ordinary course of business or items which by normal use shall be consumed or depleted during the period of the loan; and (e) In an amount, the ratio of which to the value of the security does not exceed the ratio of the companion loan to the value of the real property or leasehold. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 59-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5130 ASSET VALUATION AND PERMITTED INVESTMENTS: Investments; Certain Obligations, Property, Loans and Other Specified Items Funds of a CCO may be invested in the following: (1) Obligations secured by a mortgage or deed of trust payment of which is guaranteed by a policy of mortgage insurance. (2) Obligations issued, assumed or guaranteed by the International Bank for Reconstruction and Development. (3) Bank and bankers' acceptances and other bills of exchange of the kind and nature made eligible by law for purchase in the open market by federal reserve banks. (4) Deposits, certificates of deposits, accounts or savings or certificate shares or accounts of or in banks, trust companies, savings and loan associations or building and loan associations insured with the Federal Deposit Insurance Corporation or qualified to do business under the laws of this state. (5) Obligations issued by trustees or receivers of a corporation created or existing under the laws of a sovereign which, or the assets of which, are being administered under the direction of a court having jurisdiction if the obligation is adequately secured as to principal and interest. (6) Transportation equipment used wholly or in part within a sovereign, or adequately secured trust certificates of participation or similar obligations or contracts evidencing an interest in such transportation equipment, where the investor is entitled to receive a determined or determinable portion of rental, purchase or other obligatory payments for use or purchase of the equipment. (7) Purchase contracts or lease-purchase agreements executed under the Federal Public Buildings Purchase Contract Act of 1954, or the Post Office Department Property Act of 1954. (8) Stock of the Federal Home Loan Bank to the extent of the minimum required by the Federal Home Loan Bank Act. A CCO acquiring such stock may exercise all rights and powers given to members under such Act, including but not by way of limitation the right to obtain advances or borrow money from such bank and to pledge collateral as security therefor. (9) Obligations issued, assumed or guaranteed by the Inter-American Development Bank. (10) Obligations issued, assumed or guaranteed by the Asian Development Bank. (11) Obligations issued, assumed or guaranteed by the African Development Bank. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 59-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5135 ASSET VALUATION AND PERMITTED INVESTMENTS: Personal Property; Protection of Investment Property; Custom (1) A CCO may acquire and retain personal property received as a dividend, gift or devise, or pursuant to a lawful plan of merger, consolidation or reorganization or bona fide agreement of bulk reinsurance, or in satisfaction or liquidation of an obligation, or in exchange or part payment for real or personal property previously owned or to protect or enhance such property. (2) A CCO may make purchases or loan sums necessary to protect, preserve or enhance investment property, real or personal, which it is otherwise authorized to acquire or hold. (3) The Authority shall allow as assets in any determination of the financial condition of the CCO only such property or investments acquired or retained under this section as are consistent with the customary operations of a CCO. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 59-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5140 ASSET VALUATION AND PERMITTED INVESTMENTS: “Prudent Investor” Standard (1) Funds of a CCO may be invested in a manner not expressly prohibited under OAR 410-141-5145 and OAR 410-141-5165 provided such investments are made in the exercise of the judgment and care under the circumstances then prevailing which investors of prudence, discretion and intelligence exercise in the management of their own affairs not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital. (2) Funds invested under this section shall not exceed the lesser of seven and one-half percent of the CCO's assets or the excess of the CCO's assets over all liabilities and required capitalization. (3) If the Authority has reason to believe that loans or investments made pursuant to this section are not adequately secured or are not yielding an income the Authority may direct the CCO to report under oath the amount of such loans or investments, the security therefor and its market value. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 59-2019, adopt filed 12/18/2019, effective 01/01/2020
410-141-5155 ASSET VALUATION AND PERMITTED INVESTMENTS: Approval by Board (1) The investment policy shall be approved by the CCO’s Board or a committee thereof charged with the duty of investing the funds of the CCO. (2) Deposits shall be made in banks or banking institutions approved by the CCO’s Board. Statutory/Other Authority: ORS 413.042, 414.572, 414.591 & 414.605 Statutes/Other Implemented: ORS 414.570-414.686 & 415.001-415.430 History: DMAP 143-2024, amend filed 12/29/2024, effective 01/01/2025 DMAP 59-2019, adopt filed 12/18/2019, effective 01/01/2020