Mississippi Administrative Code › Title 19 - Department of Insurance › Part 1 - General › Chapter 22 - Credit for Reinsurance › Rule 19-1-22.13 - Letters of Credit Qualified Under Rule 22.11

Current through June 25, 2024
A. The
				letter of credit must be clean, irrevocable and unconditional and issued or
				confirmed by a qualified United States financial institution as defined in
Miss. Code Ann
. §
									83-19-155(a).
				The letter of credit shall contain an issue date and date of expiration and
				shall stipulate that the beneficiary need only draw a sight draft under the
				letter of credit and present it to obtain funds and that no other document need
				be presented. The letter of credit shall also indicate that it is not subject
				to any condition or qualifications outside of the letter of credit. In
				addition, the letter of credit itself shall not contain reference to any other
				agreements, documents or entities, except as provided in Subsection H(1) of
				this section. As used in this section, "beneficiary" means the domestic insurer
				for whose benefit the letter of credit has been established and any successor
				in interest to the named beneficiary, then the named beneficiary includes and
				is limited to the court appointed domiciliary receiver (including conservator,
				rehabilitator or liquidator).
B.
				The heading of the letter of credit may include a boxed section which contains
				the name of the applicant and other appropriate notations to provide a
				reference for the letter of credit. The boxed section shall be clearly marked
				to indicate that such information is for internal identification purposes
				only.
C. The letter of credit shall
				contain a statement to the effect that the obligation of the qualified United
				States financial institution under the letter of credit is in no way contingent
				upon reimbursement with respect thereto.
D. The term of the letter of credit shall be
				for at least one year and shall contain an "evergreen clause" which prevents
				the expiration of the letter of credit without due notice from the issuer. The
				"evergreen clause" shall provide for a period of no less than thirty (30) days'
				notice prior to expire date or nonrenewal.
E. The letter of credit shall state whether
				it is subject to and governed by the laws of this state or the Uniform Customs
				and Practice for Documentary Credits of the International Chamber of Commerce
				Publication 600 (UCP 600) or International Standby Practices of the
				International Chamber of Commerce Publication 590 (ISP98), or any successor
				publication, and all drafts drawn thereunder shall be presentable at an office
				in the United States of a qualified United States financial
				institution.
F. If the letter of
				credit is made subject to the Uniform Customs and Practice for Documentary
				Credits of the International Chamber of Commerce Publication 600 (UCP 600) or
				International Standby Practices of the International Chamber of Commerce
				Publication 590 (ISP98), or any successor publication, then the letter of
				credit shall specifically address and make provision for an extension of time
				to draw against the letter of credit in the event that one or more of the
				occurrences specified in Article 36 of Publication 600 or any other successor
				publication, occur.
G. If the
				letter of credit is issued by a financial institution authorized to issue
				letters of credit, other than a qualified United States financial institution
				as described in Subsection A of this section, then the following additional
				requirements shall be met:
1. The issuing
				financial institution shall formally designate the confirming qualified United
				States financial institution as its agent for the receipt and payment of the
				drafts; and,
2. The "evergreen
				clause" shall provide for thirty (30) days' notice prior to expiration date for
				nonrenewal.