New York Codes, Rules and Regulations › Title 11 - INSURANCE › Chapter IV - Financial Condition Of Insurer and Reports to Superintendent › Subchapter D - Reinsurance › Part 125 - Credit For Reinsurance › Section 125.5 - Credit for reinsurance involving the risks of life, annuity and accident and health from unauthorized insurers

Current through Register Vol. 46, No. 28, July 10, 2024
(a) A ceding insurer may elect to take
				  credit, as an asset or as a deduction from reserves, for reinsurance
				  recoverable involving life, annuity and accident and health risks from an
				  assuming insurer not authorized in this State, provided such assuming insurer
				  complies with provisions of section
				  125.4(a),
				  (b), (h), or (i) of this Part. The
				  provisions of section
				  125.4(c),
				  (d), (e), (f) and (g)  of this Part are
				  inappropriate for and shall be inapplicable to reinsurance of life, annuity and
				  accident and health risks.
(b)
(1) Notwithstanding the provisions of
				  subdivision (a) of this section or the amounts of funds withheld under a
				  reinsurance agreement from an unauthorized insurer on behalf of such
				  reinsurance, credit taken by a ceding insurer for reinsurance ceded to an
				  unauthorized insurer shall not exceed the aggregate of the net amount of
				  reserves plus the liability for any unallocated amounts which has been set up
				  and reported to the ceding insurer as being held by the assuming unauthorized
				  insurer and by each subsequent retrocessionaire on behalf of such
				  reinsurance.
(2) Paragraph (1) of
				  this subdivision shall not apply to situations where the total reserve credit
				  that may be granted under a reinsurance agreement is based solely upon:
(i) the establishment of a liability by the
				  ceding insurer for funds withheld under a reinsurance agreement with such
				  unauthorized reinsurer as security for the payment of obligations thereunder;
				  and/or
(ii) the establishment of a
				  trust agreement which complies with Part 126 of this Title (Regulation
				  114).
(3) Compliance
				  with paragraphs (1) and (2) of this subdivision shall be on an agreement by
				  agreement basis.
(4)
(i) The report referred to in paragraph (1)
				  of this subdivision shall be obtained by the ceding insurer from:
(a) the assuming insurer, if accredited in
				  this State, or if certified under the provisions of section
				  125.4(h) 
				  of this Part, or if domiciled in a reciprocal jurisdiction under the provisions
				  of section
				  125.4(i) 
				  of this Part, as to the total net reserves held by it and by all
				  retrocessionaires; or
(b) the
				  assuming insurer and from each of the retrocessionaires with respect to the net
				  reserves held by each of them.
(ii) Each such report shall be in writing,
				  signed by an officer of the assuming insurer or the retrocessionaire that
				  provided it and obtained by the ceding insurer prior to the filing date of
				  ceding insurer's annual and quarterly statement. Such reports shall be
				  maintained by the ceding insurer for three years or until the conclusion of the
				  next regular examination conducted by the insurance department of its state of
				  domicile, whichever is later. The superintendent may approve a plan of
				  compliance submitted by an accredited reinsurer that would permit a
				  certification to be attached to a reinsurance agreement with a ceding insurer
				  in lieu of obtaining such reports.