2023 Arizona Revised Statutes › Title 20 - Insurance › § 20-481.10 - Form and content of registration statement; disclosure of information; enterprise risk filing

20-481.10.
Form and content of registration statement;  disclosure of information;  enterprise risk filing
A. Every insurer subject to registration shall file a registration statement on a form provided by the director,  which shall contain current information concerning:
1. The capital structure,  general financial condition,  ownership and management of the insurer and identity of any person controlling the insurer.
2. The identity of every member of the insurance holding company system that directly or indirectly controls the insurer.
3. The following agreements in force,  relationships subsisting and transactions currently outstanding or that have occurred during the last calendar year between such insurer and its affiliates:
(a) Loans,  other investments or purchases,  sales or exchanges of securities of the affiliates by the insurer or of the insurer by its affiliates.
(b) Purchases,  sales or exchanges of assets.
(c) Transactions not in the ordinary course of business.
(d) Guarantees or undertakings for the benefit of any affiliate that result in an actual contingent exposure of the insurer's assets to liability,  other than insurance contracts entered into in the ordinary course of the insurer's business.
(e) All management and service contracts and all cost sharing arrangements.
(f) Reinsurance agreements.
(g) Dividends and other distributions to shareholders.
(h) Consolidated tax allocation agreements.
4. A pledge of the insurer's stock,  including stock of any subsidiary or controlling affiliate,  for a loan made to a member of the insurance holding company system.
5. If requested by the director,  financial statements of or within an insurance holding company system,  including all affiliates. Financial statements may include annual audited financial statements filed with the United States securities and exchange commission pursuant to the securities act of 1933 or the securities exchange act of 1934. An insurer required to file financial statements pursuant to this paragraph may satisfy the request by providing the director with the most recent parent corporation financial statements filed with the United States securities and exchange commission.
6. Other matters concerning transactions between registered insurers and any affiliates as may be included from time to time in any registration forms adopted or approved by the director.
7. A statement that the insurer's board of directors oversees corporate governance and internal controls of the insurer and that the insurer's officers or senior management have approved and implemented and maintain and monitor corporate governance and internal control procedures.
8. Any other information required by the director by rule.
B. All registration statements shall contain a summary outlining all items in the current registration statement representing changes from the prior registration statement.
C. A person within an insurance holding company system that is subject to registration shall provide complete and accurate information to an insurer if this information is reasonably necessary to enable the insurer to comply with this article.
D. The following provisions apply to enterprise risk filings:
1. The ultimate controlling person of each insurer that is subject to registration shall file an annual enterprise risk report that to the best of the ultimate controlling person's knowledge and belief identifies the material risks within the insurance holding company system that could pose enterprise risk to the insurer. The ultimate controlling person shall file the report according to the procedures of the national association of insurance commissioners' financial analysis handbook.
2. Except as otherwise provided in this paragraph,  the ultimate controlling person of each insurer that is subject to registration shall concurrently file an annual group capital calculation report as directed by the lead state director or commissioner. The report shall be completed in accordance with the group capital calculation instructions,  which may allow the lead state director or commissioner to allow a controlling person that is not the ultimate controlling person to file the group capital calculation report. The report shall be filed with the lead state director or commissioner in accordance with the procedures outlined in the national association of insurance commissioners' financial analysis handbook. The following provisions apply to filing the group capital calculation report:
(a) The following insurance holding companies are exempt from filing the group capital calculation report:
(i) An insurance holding company system that has only one insurer within its holding company structure,  that writes only business and is licensed only in its domestic state and that assumes no business from any other insurer.
(ii) An insurance holding company system that is required to perform a group capital calculation specified by the federal reserve board. The lead state director or commissioner shall request the calculation from the federal reserve board under the terms of information sharing agreements that are in effect. If the federal reserve board cannot share the calculation with the lead state director or commissioner,  the insurance holding company system is not exempt from the group capital calculation filing.
(iii) An insurance holding company system whose non-United States group-wide supervisor is located within a reciprocal jurisdiction,  as described in section 20-3602,  subsection H,  paragraph 1,  that recognizes the United States state regulatory approach to group supervision and group capital.
(iv) An insurance holding company system that provides information to the lead state that meets the requirements for accreditation under the national association of insurance commissioners financial standards and accreditation program through the group-wide supervisor who has determined that the information is satisfactory to allow the lead state to comply with the national association of insurance commissioners group supervision approach in accordance with the national association of insurance commissioners' financial analysis handbook,  and whose non-United States group-wide supervisor who is not in a reciprocal jurisdiction recognizes and accepts,  as specified by the director,  the group capital calculation as a worldwide group capital assessment for United States insurance groups that operate in that jurisdiction.
(b) Notwithstanding subdivision (a),  items (iii) and (iv) of this paragraph,  a lead state director or commissioner shall require the group capital calculation for United States operations of any non-United States based insurance holding company system where,  after any necessary consultation with other supervisors or officials,  it is deemed appropriate by the lead state director or commissioner for prudential oversight and solvency monitoring purposes or for ensuring the competitiveness of the insurance marketplace.
(c) Notwithstanding subdivision (a) of this paragraph,  the lead state director or commissioner has discretion to exempt the ultimate controlling person from filing the annual group capital calculation report or to accept a limited group capital filing or report in accordance with the criteria as specified by the director or commissioner in regulation.
(d) If the lead state director or commissioner determines that an exemption from filing the group capital calculation report no longer applies to an insurance holding company system,  the insurance holding company system shall file the group capital calculation report at the next annual filing date unless reasonable grounds exist for the lead state director or commissioner to grant an extension.
3. The ultimate controlling person of each insurer that is subject to registration and selected into the national association of insurance commissioners liquidity stress test framework shall file the results of a specific year's liquidity stress test with the lead state director or commissioner according to the procedures prescribed in the national association of insurance commissioners' financial analysis handbook. The following provisions apply to the liquidity stress test framework:
(a) The liquidity stress test framework includes scope criteria that are applicable to a specific data year. The scope criteria must be reviewed at least annually by the national association of insurance commissioners financial stability task force or its successor. Any change to the liquidity stress test framework or to a data year for which the scope criteria is to be measured shall be effective on January 1 of the year following the calendar year when the changes are adopted. Insurers that meet at least one threshold of the scope criteria are considered selected into the liquidity stress test framework for the specified data year unless the lead state director or commissioner,  in consultation with the national association of insurance commissioners financial stability task force or its successor,  determines that the insurer should not be included into the liquidity stress test framework for that data year. Insurers that do not meet at least one threshold of the scope criteria are excluded from the liquidity stress test framework for the specified data year unless the director,  in consultation with the national association of insurance commissioners financial stability task force or its successor,  determines that the insurer should be included into the liquidity stress test framework for that data year.
(b) An insurance holding company system shall perform and file a specific year's liquidity stress test in accordance with the liquidity stress test framework's instructions and reporting templates for that specific year and any lead state director or commissioner determinations.