SC Code § 38-21-295 (2021)
2021 South Carolina Code of Laws|Title 38 - Insurance|Chapter 21 - Insurance Holding Company Regulatory Act|Section 38-21-295. Group-wide supervisor for internationally active insurance groups.

 (A) The director is authorized to act as the group-wide supervisor for an internationally active insurance group in accordance with the provisions of this section. However, the director may otherwise acknowledge another regulatory official as the group-wide supervisor where the internationally active insurance group:  (1) does not have substantial insurance operations within the United States;  (2) has substantial insurance operations in the United States but not in South Carolina; or  (3) has substantial insurance operations in the United States and South Carolina, but the director has determined that another regulatory official is the appropriate group-wide supervisor pursuant to the factors set forth in this section.  An insurance holding company system that does not otherwise qualify as an internationally active insurance group may request that the director make a determination or acknowledgment as to a group-wide supervisor.  (B) In cooperation with other state, federal, and international regulatory agencies, the director will identify a single group-wide supervisor for an internationally active insurance group. The director may determine that he is the appropriate group-wide supervisor for an internationally active insurance group that conducts substantial insurance operations concentrated in this State. However, the director may acknowledge that a regulatory official from another jurisdiction is the appropriate group-wide supervisor for the internationally active insurance group. The director shall consider the following factors when making a determination or acknowledgment:  (1) the place of domicile of the insurers within the internationally active insurance group that holds the largest share of the group's written premiums, assets, or liabilities;  (2) the place of domicile of the top-tiered insurer or insurers in the insurance holding company system of the internationally active insurance group;  (3) the location of the executive offices or largest operational offices of the internationally active insurance group;  (4) whether another regulatory official is acting or is seeking to act as the group-wide supervisor under a regulatory system that the director determines to be:  (a) substantially similar to the system of regulation provided under the laws of this State; or  (b) otherwise sufficient in terms of providing for group-wide supervision, enterprise-risk analysis, and cooperation with other regulatory officials; and  (5) whether another regulatory official acting or seeking to act as the group-wide supervisor provides the director with reasonably reciprocal recognition and cooperation.  However, a director identified under this section as the group-wide supervisor may determine that it is appropriate to acknowledge another supervisor to serve as the group-wide supervisor. The acknowledgment of the group-wide supervisor must be made after consideration of the factors listed above, in cooperation with and subject to the acknowledgment of other regulatory officials involved with supervision of members of the internationally active insurance group, and in consultation with the internationally active insurance group.  (C) Notwithstanding another provision of law, when another regulatory official is acting as the group-wide supervisor of an internationally active insurance group, the director shall acknowledge that regulatory official as the group-wide supervisor. However, in the event of a material change in the internationally active insurance group that results in the internationally active insurance group's insurers domiciled in this State holding the largest share of the group's premiums, assets, or liabilities or this State being the place of domicile of the top-tiered insurer or insurers in the insurance holding company system of the internationally active insurance group, the director shall make a determination or acknowledgment as to the appropriate group-wide supervisor for such an internationally active insurance group.  (D) Pursuant to the provisions of Section 38-21-280, the director is authorized to collect from any insurer registered pursuant to this section all information necessary to determine whether the director may act as the group-wide supervisor of an internationally active insurance group or if the director may acknowledge another regulatory official to act as the group-wide supervisor. Prior to issuing a determination that an internationally active insurance group is subject to group-wide supervision by the director, the director shall notify the insurer registered pursuant to this section and the ultimate controlling person within the internationally active insurance group. The internationally active insurance group shall have no less than thirty days to provide the director with additional information pertinent to the pending determination. The director shall publish in the State Register and on its website the identity of internationally active insurance groups that the director has determined are subject to group-wide supervision.  (E) If the director is the group-wide supervisor for an internationally active insurance group, the director is authorized to engage in the following group-wide supervision activities:  (1) assess the enterprise risks within the internationally active insurance group to ensure that:  (a) the material financial condition and liquidity risks to the members of the internationally active insurance group that are engaged in the business of insurance are identified by management; and  (b) reasonable and effective mitigation measures are in place;  (2) request from any member of an internationally active insurance group subject to the director's supervision, information necessary and appropriate to assess enterprise risk including, but not limited to, information about the members of the internationally active insurance group regarding:  (a) governance, risk assessment, and management;  (b) capital adequacy; and  (c) material intercompany transactions;  (3) coordinate and, through the authority of the regulatory officials of the jurisdictions where members of the internationally active insurance group are domiciled, compel development and implementation of reasonable measures designed to ensure that the internationally active insurance group is able to timely recognize and mitigate enterprise risks to members of such internationally active insurance groups that are engaged in the business of insurance;  (4) communicate with other state, federal, and international regulatory agencies for members within the internationally active insurance group and share relevant information subject to the confidentiality provisions of Section 38-21-290, through supervisory colleges as set forth in Section 38-21-285 or otherwise;  (5) enter into agreements with or obtain documentation from any insurer registered pursuant to this section, any member of the internationally active insurance group, and any other state, federal, and international regulatory agencies for members of the internationally active insurance group, providing the basis for or otherwise clarifying the director's role as group-wide supervisor, including provisions for resolving disputes with other regulatory officials. Such agreements or documentation must not serve as evidence in any proceeding that any insurer or person within an insurance holding company system not domiciled or incorporated in this State is doing business in this State or is otherwise subject to jurisdiction in this State; and  (6) other group-wide supervision activities, consistent with the authorities and purposes enumerated, as considered necessary by the director.  (F) If the director acknowledges that another regulatory official from a jurisdiction that is not accredited by the National Association of Insurance Commissioners is the group-wide supervisor, the director is authorized to reasonably cooperate, through supervisory colleges or otherwise, with group-wide supervision undertaken by the group-wide supervisor, provided that the:  (1) director's cooperation is in compliance with the laws of this State; and  (2) regulatory official acknowledged as the group-wide supervisor also recognizes and cooperates with the director's activities as a group-wide supervisor for other internationally active insurance groups where applicable. Where such recognition and cooperation is not reasonably reciprocal, the director is authorized to refuse recognition and cooperation.  (G) The director is authorized to enter into agreements with or obtain documentation from any insurer registered pursuant to this chapter, any affiliate of the insurer, and other state, federal, and international regulatory agencies for members of the internationally active insurance group, that provide the basis for or otherwise clarify a regulatory official's role as group-wide supervisor.  (H) The director may promulgate regulations necessary for the administration of this section.  (I) A registered insurer subject to this section is liable for and shall pay the reasonable expenses of the director's participation in the administration of this section, including the engagement of attorneys, actuaries, and any other professionals and all reasonable travel expenses.  HISTORY: 2019 Act No. 3 (S.75), Section 2, eff March 20, 2019.