Arizona Administrative Code › Title 20 - COMMERCE, FINANCIAL INSTITUTIONS, AND INSURANCE › Chapter 06 - DEPARTMENT OF INSURANCE AND FINANCIAL INSTITUTIONS - INSURANCE DIVISION › Article 16 - CREDIT FOR REINSURANCE › Part A - CREDIT FOR REINSURANCE › Section R20-6-A1606 - Credit for Reinsurance - Reciprocal Jurisdictions; Credit for Reinsurance Required by Law

Current through Register Vol. 30, No. 28, July 12, 2024
A. Credit for
				  reisurance to a reciprocal jurisdiction assuming insurer. Pursuant to A.R.S.
				  §
										20-3602(H),
				  (I), (J), (K), (L), and (R), the Director
				  shall allow credit for reinsurance ceded by a domestic insurer to an assuming
				  insurer that is licensed to write reinsurance by, and has its head office or is
				  domiciled in, a reciprocal jurisdiction, and which meets the other requirements
				  of this Part.
B. A "reciprocal
				  jurisdiction" is a jurisdiction, as designated by the Director pursuant to
				  subsection (D) of this Section that meets one of the following:
1. A non-U.S. jurisdiction that is subject to
				  an in-force covered agreement with the United States, each within its legal
				  authority, or, in the case of a covered agreement between the United States and
				  the European Union, is a member state of the European Union. For purposes of
				  this subsection (B)(1), a "covered agreement" is an agreement entered into
				  pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act,
				  31 U.S.C. §§
												313 and
				  314, that is
				  currently in effect or in a period of provisional application and addresses the
				  elimination, under specified conditions, of collateral requirements as a
				  condition for entering into any reinsurance agreement with a ceding insurer
				  domiciled in this state or for allowing the ceding insurer to recognize credit
				  for reinsurance;
2. A U.S.
				  jurisdiction that meets the requirements for accreditation under the NAIC
				  financial standards and accreditation program; or
3. A qualified jurisdiction, as determined by
				  the Director pursuant to A.R.S. §
											20-3602(G)(3)
				   and Section R20-6-A1605(C), which is not
				  otherwise described in subsections (B)(1) or (B)(2) above and which the
				  Director determines meets all of the following additional requirements:
a. Provides that an insurer who has its head
				  office or is domiciled in such qualified jurisdiction shall receive credit for
				  reinsurance ceded to a U.S.-domiciled assuming insurer in the same manner as
				  credit for reinsurance is received for reinsurance assumed by insurers
				  domiciled in such qualified jurisdiction;
b. Does not require a U.S.-domiciled assuming
				  insurer to establish or maintain a local presence as a condition for entering
				  into a reinsurance agreement with any ceding insurer subject to regulation by
				  the non-U.S. jurisdiction or as a condition to allow the ceding insurer to
				  recognize credit for such reinsurance;
c. Recognizes the U.S. state regulatory
				  approach to group supervision and group capital, by providing written
				  confirmation by a competent regulatory authority, in such qualified
				  jurisdiction, that insurers and insurance groups who are domiciled or maintain
				  their headquarters in this state or another jurisdiction accredited by the NAIC
				  shall be subject only to worldwide prudential insurance group supervision
				  including worldwide group governance, solvency and capital, and reporting, as
				  applicable, by the Director or the commissioner of the domiciliary state and
				  will not be subject to group supervision at the level of the worldwide parent
				  undertaking of the insurance or reinsurance group by the qualified
				  jurisdiction; and
d. Provides
				  written confirmation by a competent regulatory authority in such qualified
				  jurisdiction that information regarding insurers and their parent, subsidiary,
				  or affiliated entities, if applicable, shall be provided to the Director in
				  accordance with a memorandum of understanding or similar document between the
				  Director and such qualified jurisdiction, including but not limited to the
				  International Association of Insurance Supervisors Multilateral Memorandum of
				  Understanding or other multilateral memoranda of understanding coordinated by
				  the NAIC.