reglab/housing_qa huggingface dataset:
CA Ins Code § 12106 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12106.

12106.  (a) An admitted financial guaranty insurance corporation’s investments in any one entity insured by that corporation shall not exceed 4 percent of its admitted assets as of the end of the prior calendar year, except that this limit shall not apply to investments payable or guarantied by a United States governmental unit or agency or the State of California if the investments payable or guarantied by the United States governmental unit or agency or the State of California shall be rated in one of the top two generic lettered rating classifications by a securities rating agency acceptable to the commissioner.(b) In addition to any transaction that an insurer meeting the requirements of Section 1211 may effect and maintain under any other provision of this code, a financial guaranty insurance corporation may effect and maintain a transaction in contracts for the future delivery or receipt of the currency of a foreign country, interest rate options, credit default swaps under which the insurer is acquiring credit protection, and any other products included in the plan referred to in paragraph (7), if the following conditions are satisfied:(1) The transaction is used for the purpose of limiting risk of loss under financial guaranty insurance policies or reinsurance contracts covering those policies due to fluctuations in interest rates or currency exchange rates or, in the case of credit default swaps, financial default, insolvency, or other credit events.(2) The transaction does not exceed a duration of 12 months beyond the term of those policies or reinsurance contracts.(3) The amount of foreign currencies to be purchased under the transaction does not exceed the amount guarantied under those policies or reinsurance contracts that is denominated in foreign currency.(4) The amount that is subject to interest rate hedging transactions does not exceed the amount guarantied under those policies or reinsurance contracts that is subject to the risk of interest rate fluctuations.(5) The counterparty to the transaction has, or is the principal operating subsidiary of a holding company that has, a long-term unsecured debt rating or claims-paying ability rating that is at least investment grade.(6) The transaction is not conducted for arbitrage purposes.(7) The transaction is entered into pursuant to a plan that has been approved by the board of directors of the financial guaranty insurance corporation and filed with and approved by the insurance department of the state of domicile of the financial guaranty insurance corporation.(c) A transaction entered into pursuant to subdivision (b) shall be governed by the terms of this section and shall not be subject to Section 1211.(Amended by Stats. 2005, Ch. 412, Sec. 2. Effective January 1, 2006.)
CA Ins Code § 12107 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12107.

12107.  (a) No insurer shall be issued a license to transact financial guaranty insurance unless it has paid-in capital of at least fifteen million dollars ($15,000,000) and surplus of at least eighty-five million dollars ($85,000,000), and shall at all times thereafter maintain a minimum paid-in capital of fifteen million dollars ($15,000,000) and a minimum surplus of sixty million dollars ($60,000,000).(b) An insurer licensed in this state and issuing or reinsuring financial guaranty insurance policies in this state prior to January 1, 1991, shall, notwithstanding the provisions of subdivision (a), be deemed to meet the combined paid-in capital and surplus requirements for transacting the financial guaranty insurance business during the period between January 1, 1991, and January 1, 1993, if it has combined capital and surplus of forty-five million dollars ($45,000,000), which includes paid-in capital of at least two million five hundred thousand dollars ($2,500,000).(c) On and after January 1, 1993, every financial guaranty insurance corporation must fully comply with the condition in subdivision (a) that a minimum paid-in capital of fifteen million dollars ($15,000,000) be held and maintained.(Repealed and added by Stats. 1990, Ch. 1032, Sec. 6.)
CA Ins Code § 12109 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12109.

12109.  (a) In addition to the contingency reserve, the case basis method or other method as may be prescribed by the commissioner shall be used to determine loss reserves, which shall include a reserve for claims reported and unpaid net of collateral. A deduction from loss reserves shall be allowed for the time value of money by application of a discount rate equal to the average rate of return on the admitted assets of the financial guaranty insurance corporation as of the date of the computation of that reserve. The discount rate shall be adjusted at the end of each calendar year.In addition a reserve component for incurred but not reported claims shall be reasonably estimated if deemed necessary by the financial guaranty insurance corporation, or following an examination or actuarial analysis, by the commissioner.(b) Except as otherwise permitted by the commissioner, no deduction shall be made for anticipated salvage in computing case basis loss reserves, unless that salvage is held by or under the control of the financial guaranty insurance corporation and would qualify as an admitted asset under Section 1100 and Article 3 (commencing with Section 1170) of Chapter 2 of Part 2 of Division 1 and Article 4 (commencing with Section 1190) of Chapter 2 of Part 2 of Division 1, or unless that salvage constitutes or is secured by a clean, irrevocable letter of credit which is approved by the commissioner or complies with the definition of a letter of credit provided in subdivision (e) of Section 12100.(c) If the insured principal and interest on a defaulted issue of obligations exceed 10 percent of the financial guaranty insurance corporation’s capital, surplus, and contingency reserves, its reserve so established shall be supported by a report from an independent source acceptable to the commissioner.(Repealed and added by Stats. 1990, Ch. 1032, Sec. 6.)
CA Ins Code § 12110 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12110.

12110.  An unearned premium reserve shall be established and maintained net of reinsurance and collateral with respect to all financial guaranty premiums. Where financial guaranty insurance premiums are paid on an installment basis, an unearned premium reserve shall be established and maintained, net of reinsurance, computed on a daily or monthly pro rata basis. All other financial guaranty insurance premiums written shall be earned in proportion with the expiration of exposure, or by such other method as may be prescribed or approved by the commissioner.(Amended by Stats. 2005, Ch. 412, Sec. 4. Effective January 1, 2006.)
CA Ins Code § 12111 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12111.

12111.  An admitted financial guaranty insurance corporation shall adopt procedures reasonably calculated to ensure, to the extent it is commercially feasible for the financial guaranty insurance corporation, that any prospectus which discloses that a policy of financial guaranty insurance has been issued also discloses that in the event the financial guaranty insurance corporation were to become insolvent, any claims arising under the policies of financial guarantee insurance are excluded from coverage by the California Insurance Guaranty Association, established pursuant to Article 15.2 (commencing with Section 1063) of Chapter 1 of Part 2 of Division 1.(Amended by Stats. 2005, Ch. 412, Sec. 5. Effective January 1, 2006.)
CA Ins Code § 12113 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12113.

12113.  An admitted financial guaranty insurance corporation shall keep copies of all relevant materials prepared by the insurer or used in the initial underwriting or ongoing monitoring of insured risk; all relevant documents pertaining to changes in the credit risk or performance of the insured on the obligation, and all materials pertaining to the examination of the condition of collateral, assets, or other security; and any other materials requested by the commissioner. All those materials shall be maintained for the entire period during which the insurance is in force and shall be available for examination upon request of the commissioner by the commissioner or by any rating agency approved by the commissioner.(Added by Stats. 1990, Ch. 1032, Sec. 6.)
CA Ins Code § 12114 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12114.

12114.  (a) An insurer may insure obligations enumerated in subparagraphs (A), (B), and (C) of paragraph (1) of subdivision (b) of Section 12112 that are not investment grade so long as at least 95 percent of the insurer’s total net liability on the kinds of obligations enumerated in those subparagraphs is investment grade.(b) The financial guaranty insurance corporation shall at all times maintain capital, surplus, and contingency reserve in the aggregate no less than the sum of the following:(1) 0.3333 percent of the total net liability under guaranties of municipal bonds and utility first mortgage obligations.(2) 0.6666 percent of the total net liability under guaranties of investment grade asset-backed securities.(3) 1.0 percent of the total net liability under guaranties, secured by collateral or having a term of seven years or less of:(A) Investment grade industrial development bonds, and(B) Other investment grade obligations.(4) 1.5 percent of the total net liability under guaranties of other investment grade obligations.(5) 2.0 percent of the total net liability under guaranties of:(A) Noninvestment grade consumer debt obligations, and(B) Noninvestment grade asset-backed securities.(6) 3.0 percent of the total net liability under guaranties of noninvestment grade obligations secured by first mortgages on commercial real estate and having loan-to-value ratios of 80 percent or less.(7) 5.0 percent of the total net liability under guaranties of other noninvestment grade obligations.(8) If the amount of collateral required by paragraph (3) of subdivision (b) is no longer maintained, that proportion of the obligation insured which is not so collateralized shall be subject to the aggregate limits specified in paragraph (4) of subdivision (b).(9) Additional surplus determined by the commissioner to be adequate to support the writing of surety insurance and credit insurance if the financial guaranty insurance corporation has been authorized to transact surety insurance and credit insurance as authorized by Section 12102.(c) Whenever the reserves for outstanding credit insurance losses or loss expenses or any insurer licensed in this state to transact financial guaranty insurance are determined by the commissioner to be inadequate, he or she shall require the insurer to maintain additional reserves.(Amended by Stats. 2005, Ch. 412, Sec. 7. Effective January 1, 2006.)
CA Ins Code § 12115.5 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12115.5.

12115.5.  (a) If an admitted financial guaranty insurance corporation fails to maintain a rating in any of the top three generic rating classifications by any securities rating agency acceptable to the commissioner, it shall immediately send written notification of this failure to both the commissioner and the insurance regulatory authority in its state of domicile.(b) (1) If an admitted financial guaranty insurance corporation fails to maintain a rating at least equal to the highest notch in the fourth generic rating classification by any securities rating agency acceptable to the commissioner, the insurer shall prepare and file with the commissioner a two-year business plan, in reasonable detail, together with other information that the commissioner requires. The plan shall be filed within 45 days of the date when the insurer fails to maintain that rating.(2) In response to that failure, the commissioner may conduct any examination or analysis of the insurer’s assets, liabilities, and operations, including its pricing, that he or she deems necessary.(3) After reviewing the business plan and conducting any examination or analysis, the commissioner may issue a corrective order specifying the corrective measures that he or she determines to be required, and the insurer shall implement those measures. In determining corrective measures, the commissioner may take into account the factors that he or she deems relevant with respect to the insurer, including the results of the examination or analysis.(c) If an admitted financial guaranty insurance corporation fails to maintain an investment grade rating by any securities rating agency acceptable to the commissioner, it shall not do either of the following without the commissioner’s specific prior written approval:(1) If domiciled in this state, accept additional risks or issue new policies anywhere.(2) If domiciled in another state, accept additional risks in this state or issue new policies insuring risks in this state.(Added by Stats. 2005, Ch. 412, Sec. 9. Effective January 1, 2006.)
CA Ins Code § 12116 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12116.

12116.  (a) If an admitted financial guaranty insurance corporation at any time exceeds any limitation prescribed by subdivision (a) or (b) of Section 12114 or Section 12115, the corporation shall immediately notify the commissioner in writing. Upon receipt of the written notification, or independent of its receipt, the commissioner may issue an order to show cause why the financial guaranty insurance corporation should not cease transacting financial guaranty insurance business. If the commissioner issues such an order, the commissioner shall serve notice of hearing with the order to the financial guaranty insurance corporation stating the time and place therefor, and the conduct, condition or grounds upon which the commissioner has made the order. The hearing shall occur not less than 20 nor more than 30 days after notice is served. At the hearing, the burden to show cause why the financial guaranty insurance corporation should not cease transacting new financial guaranty insurance shall be borne solely by the financial guaranty insurance corporation.(b) If the commissioner does not issue an order pursuant to subdivision (a) upon receiving written notice, the financial guaranty insurance corporation shall, within 30 days after the limitations are breached, submit a written plan to the commissioner detailing the steps that it will take or has taken to reduce its exposure to loss to no more than the amounts permitted by subdivisions (a) and (b) of Section 12114 and Section 12115. If, after review of the written plan, the commissioner determines that the corporation has not presented reasonable steps to reduce its exposure to loss to not more than the permitted amounts, the commissioner may issue an order to show cause following the same procedures as prescribed in subdivision (a).(c) If, after notice and hearing pursuant to subdivision (a) or (b), the commissioner determines that the financial guaranty insurance corporation has exceeded any limitation prescribed by subdivision (a) or (b) of Section 12114 or Section 12115, the commissioner may order the corporation to cease transacting any new financial guaranty insurance business until its exposure to loss no longer exceeds these limitations.(d) The provisions of this section and Section 12115.5 shall in no way limit the stop order power of the commissioner under any other section.(Amended by Stats. 2005, Ch. 412, Sec. 10. Effective January 1, 2006.)
CA Ins Code § 12116.5 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12116.5.

12116.5.  (a) The commissioner may, for good cause, implement by regulation, order, or written consent, reasonable conditions or limitations under which any or all admitted financial guaranty insurance corporations may insure the type of business described in paragraph (2) of subdivision (c) of Section 12100 or subdivision (a) of Section 12119, reduce reserves in respect of collateral described in paragraph (2) or (5) of subdivision (e) of Section 12100, or engage in the transactions described in subdivision (b) of Section 12106, when, in the judgment of the commissioner, those conditions or limitations are necessary and appropriate to safeguard insurer solvency.(b) Whenever the reserves for outstanding liabilities for obligations insured under subdivision (c) of Section 12100 are determined by the commissioner to be inadequate, he or she shall require the insurer to maintain additional reserves.(c) The commissioner may disallow, for purposes of any financial statements or reports required or permitted to be filed under this code, the recognition of collateral authorized by paragraph (2) or (5) of subdivision (e) of Section 12100 if the commissioner finds after inquiry and review that the collateral fails to legally secure the obligations to which it relates, the collateral is inaccurately valued, the value of the collateral is insufficient in relation to the obligations secured, or the legality or value of the collateral cannot readily be ascertained based on information provided.(d) The commissioner may require restatement or other relevant revision of any admitted financial guaranty insurer’s annual or other financial statement or report required or permitted to be filed under this code if the commissioner finds after inquiry and review that any transaction entered into under subdivision (b) of Section 12106 has the effect of distorting, misrepresenting, or otherwise rendering inaccurate, misleading, or incomplete the financial condition of the insurer in any material respect.(e) No credit default swap authorized or permitted to be insured, acquired, or otherwise used for any purpose by any admitted financial guaranty insurance corporation under any provision of this code shall be used in any manner for more than one purpose, or under more than one statutory authorization, unless authorized by this code.(Added by Stats. 2005, Ch. 412, Sec. 11. Effective January 1, 2006.)
CA Ins Code § 12117 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12117.

12117.  A financial guaranty insurance corporation shall not be deemed in violation of any limitation prescribed by Section 12115 with respect to any financial guaranty insurance outstanding prior to January 1, 1991, if the financial guaranty insurance corporation was in compliance with the applicable single risk limit in effect in this state at the time that the financial guaranty insurance policy was issued. If the financial guaranty insurance corporation was not so in compliance, it shall comply with the limitations prescribed by Section 12115 no later than January 1, 1994.(Added by Stats. 1990, Ch. 1032, Sec. 6.)
CA Ins Code § 12119 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12119.

12119.  Policy forms and any amendments thereto shall be filed with the commissioner within 30 days after their use in this state by the financial guaranty insurance corporation.(a) (1) Every policy shall provide that, in the event of a payment default or insolvency of the obligor, there shall be no acceleration of the payments required to be made under the policy with respect to guarantied obligations except at the option of the financial guaranty insurance corporation.(2) Notwithstanding paragraph (1), the following provisions apply:(A) A policy may insure amounts payable under a credit default swap or interest rate, currency, or other swap upon a credit event or termination event if the expected amount payable on an accelerated basis in respect of any individual obligation referenced by a credit default swap or in the aggregate under an interest rate, currency, or other swap does not exceed the single risk limits prescribed in subdivision (e) of Section 12115.(B) A policy insuring a credit default swap referencing an obligation shall be treated as if the insurer had directly insured the referenced obligation for all other purposes of this article, including, without limitation, contingency reserve requirements, except that the currency of amounts owed under the credit default swap, rather than the currency of the obligations referenced by the credit default swap, shall apply for purposes of determining whether the obligation is a permissible guaranty under subdivision (b) of Section 12112.(b) Every policy shall contain a statement that in the event the insurer were to become insolvent, any claims arising under a policy of financial guaranty insurance are excluded from coverage by the California Insurance Guaranty Association, established pursuant to Article 15.2 (commencing with Section 1063) of Chapter 1 of Part 2 of Division 1.(c) The commissioner may prescribe additional minimum policy provisions determined by the commissioner to be necessary or appropriate to protect policyholders, claimants, obligees, or indemnitees.(Amended by Stats. 2005, Ch. 412, Sec. 12. Effective January 1, 2006.)
CA Ins Code § 12120 (2021)
2021 California Code|Insurance Code - INS|DIVISION 2 - CLASSES OF INSURANCE|PART 4 - MISCELLANEOUS CASUALTY INSURANCES|CHAPTER 1 - Surety Insurers on Reserve Basis; Capital Requirements and Permitted Insurances|ARTICLE 5 - Financial Guaranty Insurance|Section 12120.

12120.  An admitted financial guaranty insurance corporation with respect to financial guaranty insurance rates, shall not be subject to Sections 1861.01 and 1861.05, except that financial guaranty insurance rates shall not be excessive, inadequate, or unfairly discriminatory or otherwise in violation of Chapter 9 (commencing with Section 1850) of Part 2 of Division 1.(Added by Stats. 1990, Ch. 1032, Sec. 6.)