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New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Section 11:2-40.1 - Purpose and scope

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The purpose of this subchapter is to provide standards for reinsurance agreements pursuant to which a ceding insurer may reduce a liability or establish an asset on any financial statements filed with the Department.
(b) This subchapter shall apply to the following:
1. All domestic insurers authorized to transact life insurance, accident and health insurance or annuity business in this State;
2. All foreign and alien insurers authorized to transact life insurance, accident and health insurance or annuity business in this State which otherwise are not subject to rules in their state of domicile that are substantially similar to those contained herein;
3. All reinsurers authorized to effect life, accident and health or annuity reinsurance agreements in this State; and
4. All reinsurance agreements entered into by an entity subject to this subchapter, except as 11:2-40.5 may apply.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Section 11:2-40.3 - Reinsurance agreements

Current through Register Vol. 56, No. 14, July 15, 2024
(a) No ceding insurer subject to this subchapter shall enter into any new reinsurance agreement, nor amend any existing reinsurance agreement so as to increase its reinsurance credit, which shall reduce any liability or establish any asset in any financial statement filed with the Department except pursuant to the following requirements:
1. The reinsurance agreement or amendment shall be filed with the Commissioner no later than 30 days after its execution. In addition, no domestic insurer shall enter into any reinsurance agreement for which the Commissioner has been granted statutory prior approval authority involving a substantial transfer of risk without the prior approval of the Commissioner. For purposes of this subsection, a transfer of risk associated with a reinsurance agreement is considered to be substantial if a material number or percentage of policies are affected by the agreement, or if there is a material change in the reserve liabilities on the policies affected by the agreement. Such agreements shall be submitted to:
Office of Life and Health
Valuation Bureau
New Jersey Department of Banking and Insurance
PO Box 325
Trenton, NJ 08625-0325
2. This filing shall include a written opinion of an actuary representing the reinsurer which describes the ceding insurer's significant risks under the policies reinsured and specifies the extent (if any) to which these significant risks are transferred to the reinsurer.
3. Each reinsurance agreement filed with the Department shall be accompanied by documentation detailing the financial impact of the agreement. This documentation shall include information as to reserves transferred under the agreement and details as to payment and expense charges to and from each party to the agreement.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Section 11:2-40.5 - Exceptions to agreements or conditions precluding reduction of liability or inclusion as an asset

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Agreements entered into on or after August 16, 1993 which involve the reinsurance of business issued prior to the effective date of the agreements, along with any subsequent amendments thereto, shall be filed by the ceding company with the Commissioner within 30 days from their date of execution.
(b) Any increase in surplus net of Federal income tax resulting from arrangements described in (a) above shall be identified separately on the insurer's financial statement as a surplus item (aggregate write-ins for gains and losses in surplus in the Capital and Surplus Account, page 4 of the Annual Statement) and recognition of the surplus increase as income shall be reflected on a net of tax basis in the "Reinsurance Ceded" line, page 4 of the Annual Statement as earnings emerge from the business reinsured.
(c) Insurers subject to this subchapter shall reduce to zero by December 31, 1995 any reserve credits or assets established with respect to reinsurance agreements entered into prior to August 16, 1993 which, under the provisions of this subchapter would not be entitled to recognition of the reserve credits or assets; provided, however, that the reinsurance agreements shall have been in compliance with laws or regulations in existence immediately preceding August 16, 1993.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Section 11:2-40.6 - Additional standards

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The ceding insurer's actuary signing the financial statement actuarial opinion with respect to the valuation of reserves shall consider this subchapter and any applicable actuarial standards of practice when determining the proper credit in financial statements filed with the Department. The actuary shall maintain adequate documentation and be prepared upon request by the Department to describe the actuarial work performed for inclusion in the financial statements and to demonstrate that such work conforms to this subchapter.
(b) Compliance with 11:2-40.4 shall not abrogate the requirement that reserve credits shall be based upon actual liability assumed by a reinsurer to reimburse a ceding insurer for benefits that the ceding insurer is obligated to pay under its direct policies and that gave rise to a required statutory reserve amount. An agreement meeting the technical requirements of N.J.A.C. 11:2-40.4, but failing to comply with the objective of this rule, shall not provide a basis for the taking of reserve credits by a ceding insurer.
(c) The ceding insurer shall maintain data used to determine reinsurance credits at its place of business for review by the Department upon request. Such data and documentation shall demonstrate compliance by the ceding insurer with this subchapter, and shall include, but not be limited to:
1. A comparison of the renewal expense allowances with the ceding insurer's anticipated expenses; and
2. A comparison of the guaranteed reserve adjustment interest rates to the maximum allowable statutory valuation rates in accordance with 17B:19-8.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Section 11:2-40.7 - Penalties

Current through Register Vol. 56, No. 14, July 15, 2024
Failure to comply with the terms of this subchapter may result in the denial of any credit taken for the reinsurance agreement, as well as the assessment of any and all penalties available pursuant to law. These penalties may be assessed against any and all parties to a reinsurance agreement that fails to comply with the terms of this subchapter.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Section 11:2-40.8 - Severability

Current through Register Vol. 56, No. 14, July 15, 2024
If any provision of this subchapter or the application thereof to any person or circumstance is held to be invalid for any reason, the remainder of the subchapter and the application of such provision to other persons or circumstances shall not be affected thereby.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 40 - LIFE, HEALTH AND ANNUITY REINSURANCE AGREEMENTS › Appendix - APPENDIX

Current through Register Vol. 56, No. 14, July 15, 2024
EXHIBIT 1
Significant Risks
Data in image
EXHIBIT 2
Formula for Determining Reserve Interest Rate Adjustment
Data in image
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 41 - HOMEOWNERS INSURANCE CONSUMER INFORMATION BROCHURE; SUMMARY OF NOTABLE COVERAGES AND EXCLUSIONS › Section 11:2-41.1 - Purpose and scope

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The purpose of this subchapter is to implement the provisions of
N.J.S.A. 17:36-5.3 6
and to set forth the minimum standards for a one-page summary of a homeowners policy, including notable coverages and exclusions, required to be provided to policyholders.
(b) This subchapter applies to all homeowners insurance policies as defined in
N.J.S.A. 17:36-5.3 3
and
11:2-42.2
, including, but not limited to:
1. Homeowners forms, including, but not limited to, HO-1, HO-2, HO-3, HO-5, and HO-8;
2. Tenants forms, including, but not limited to, HO-4;
3. Condominium forms, including, but not limited to, HO-6;
4. Dwelling/fire; and
5. Mobile home owners.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 41 - HOMEOWNERS INSURANCE CONSUMER INFORMATION BROCHURE; SUMMARY OF NOTABLE COVERAGES AND EXCLUSIONS › Section 11:2-41.2 - Consumer information brochure

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Pursuant to
N.J.S.A. 17:36-5.3 6
, all homeowners insurance policies issued, delivered, or renewed in this State shall be accompanied by notices written in a simple, clear, understandable, and easily readable way, which shall include:
1. An explanation of the insurer's hurricane deductible program if any, which program shall comply with all applicable provisions of
N.J.S.A. 17:36-5.3 4
and N.J.A.C. 11:2-42;
2. Information on flood insurance, as required by
N.J.S.A. 17:36-5.3 1
; and
3. A one-page summary of the policy, including notable coverages and exclusions as set forth in this subchapter.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 41 - HOMEOWNERS INSURANCE CONSUMER INFORMATION BROCHURE; SUMMARY OF NOTABLE COVERAGES AND EXCLUSIONS › Section 11:2-41.3 - Content of one-page summary

Current through Register Vol. 56, No. 14, July 15, 2024
(a) All one-page summary forms shall include the following content:
1. A heading, which shall be written in bold print and solid capital letters and shall say the following:
THIS SUMMARY HIGHLIGHTS THE NOTABLE COVERAGES AND EXCLUSIONS ASSOCIATED WITH YOUR
INSURANCE POLICY AND IS ONLY PROVIDED AS GUIDANCE IN HELPING YOU UNDERSTAND YOUR POLICY. THIS SUMMARY DOES NOT ALTER YOUR COVERAGE IN ANY WAY. YOUR INSURANCE POLICY IS A CONTRACT THAT GOVERNS YOUR LEGAL RIGHTS. PLEASE CONTACT IF YOU HAVE ANY QUESTIONS.
REFER TO YOUR DECLARATIONS PAGE FOR INFORMATION ON DEDUCTIBLES AND THE SPECIFIC LIMITS OF YOUR POLICY FOR EACH OF THE INCLUDED COVERAGES. REFER TO THE APPLICABLE POLICY PROVISIONS FOR OTHER INFORMATION SPECIFIC TO THESE COVERAGES, AND ON ANY ADDED COVERAGES OR EXCLUSIONS IN YOUR POLICY. ALSO, SEE THE "INSURING YOUR HOME GUIDE" FOR ADDITIONAL GUIDANCE AND INFORMATION ON THE N.J. DEPT. OF BANKING AND INSURANCE WEBSITE AT
http://www.state.nj.us/dobi/division_consumers/pdf/insuringyourhome.pdf
;
2. A description of the common coverages typically included in homeowners policies of that type, as set forth in the applicable model summary. The content of this section of the applicable model summary shall be included by insurers verbatim;
3. The policy features set forth in the model summary for the policy type being issued. However, where an insurer's policy's features differ from the description of such features contained in that model summary, the company issuing such a policy may revise that text, so as to have it accurately reflect the content of the policy; and
4. Tables specifying the notable coverages and exclusions by type of loss that are included in the policy, which the one-page summary accompanies. The tables shall include headings entitled: "Your Policy Covers Losses Caused by" and "Your Policy Does Not Cover Losses Caused by," as shown in the model summaries in the Appendix to this subchapter.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 41 - HOMEOWNERS INSURANCE CONSUMER INFORMATION BROCHURE; SUMMARY OF NOTABLE COVERAGES AND EXCLUSIONS › Section 11:2-41.4 - Policies affected

Current through Register Vol. 56, No. 14, July 15, 2024
This subchapter shall apply to all homeowners insurance policies as set forth in 11:2-41.1(b)  issued, delivered, or renewed on or after May 31, 2015.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.1 - Purpose and scope

Current through Register Vol. 56, No. 14, July 15, 2024
(a) This subchapter sets forth the expedited process for a homeowner's insurer or rating organization to file changes to its rating system; sets forth the uniform policy language that may be used with respect to hurricane deductibles; and sets forth information that shall be included in notices provided to insureds by insurers regarding hurricane deductibles, pursuant to N.J.S.A. 17:36-5.3 3 to 5.36.
(b) This subchapter shall apply to all insurers writing or transacting homeowner's insurance in this State, rating organizations, and the FAIR Plan.
(c) This subchapter shall apply only to base rate changes by form, territorial relativity factors, deductible relativity factors, protection/construction class relativity factors, amount of insurance relativity factors, liability rates and associated liability increased limit factors, and minimum premiums.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.2 - Definitions

Current through Register Vol. 56, No. 14, July 15, 2024
The following words and terms, as used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise.
"Commissioner" means the Commissioner of the New Jersey Department of Banking and Insurance.
"Department" means the New Jersey Department of Banking and Insurance.
"Earned premium" means direct earned premium, including all associated fee income collected under the insurer's approved rating system.
"FAIR Plan" means the New Jersey Insurance Underwriting Association established pursuant to 17:37A-1 et seq.
"Form" means:
1. Owners forms, including, but not limited to, HO-1, HO-2, HO-3, HO-3 w/15, HO-5, and HO-8;
2. Tenants forms, including, but not limited to, HO-4;
3. Condominium forms, including, but not limited to, HO-6;
4. Dwelling Fire;
5. Dwelling Extended Coverage;
6. Dwelling Liability; and
7. Mobile Home Owners.
"Homeowners insurance" means personal lines insurance provided against loss to real and personal property as defined in the standard fire policy and extended coverage endorsement thereon, a dwelling policy, the homeowners multiple peril policy, insurance against the perils of vandalism, malicious mischief, burglary, or theft, or liability insurance or any combination thereof, or any other such policy delivered, issued, or renewed or approved by the Commissioner for issuance, delivery, or renewal in this State.
"NAIC" means the National Association of Insurance Commissioners.
"Rate change" means a rate increase of no more than five percent overall for any individual insurer. Rate change also means any overall decrease in rates or a change in rates for any individual insurer that is revenue neutral.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.3 - Expedited rate filings; general requirements

Current through Register Vol. 56, No. 14, July 15, 2024
(a) All filings shall be submitted to the Department through the use of the NAIC electronic filing system SERFF (System for Electronic Rate and Form Filing). All data fields in SERFF shall be completed per the applicable General Instructions for New Jersey, and the SERFF Filing's General Information Filing Description Section shall be fully completed with a clear and precise description of the filing. All filing exhibits displaying calculations shall also be provided in Microsoft Excel-compatible format, with all applicable formulas displayed in the file.
(b) An insurer and/or rating organization, pursuant to
17:36-5
.35 may file for a rate change in accordance with this subchapter. The filer shall provide the following information in support of its filing:
1. A checklist that sets forth the information in Exhibit A in the subchapter Appendix incorporated herein by reference;
2. The manual rating pages containing all proposed changes in the rating system;
3. A completed Exhibit B in the subchapter Appendix incorporated herein by reference;
4. A discussion of the characteristics of policies proposed to receive significant rate impacts (greater than plus/minus 10 percent), and the proposed maximum and minimum rate impacts;
5. A completed Exhibit C in the subchapter Appendix, incorporated herein by reference; and
6. Exhibit(s) showing the effect of each proposed change separately and the overall impact of all changes combined. The exhibit shall include an exposure or premium distribution by item changed (such as, by territory, amount of insurance, protection/construction classification, etc.), with current and proposed factors and calculated changes.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.4 - Expedited rate filings; data requirements

Current through Register Vol. 56, No. 14, July 15, 2024
(a) All forms comprising an insurer's homeowners program shall be included, either in aggregate or separately if sufficient credibility of data exists.
(b) Premium, loss, and expense data shall be reported on a direct basis exclusive of business ceded to reinsurers or assumed from other insurers.
(c) Data items shall include:
1. Earned premium at present rates using either the extension of exposures or on-level factor method. Provide the relevant rate level history;
2. Premium trend factors, including all data and judgments made, and a description of the method used to select the factors;
3. Earned exposures measured in house years;
4. Paid and/or incurred losses with applicable loss development factors and formulas used;
5. Paid and/or incurred defense and cost containment expense with applicable development factors and formulas used;
6. Paid and/or incurred adjustings and other expenses;
7. Ultimate developed losses and loss adjustment expenses, including a description of the method used to select the ultimate amounts;
8. Paid and/or incurred claim counts with applicable development factors and formulas used;
9. Ultimate developed claim counts, including a description of the method used to select the ultimate amounts;
10. Loss trend factors, including all data and judgments made, and a description of the method used to select the factors;
11. Underwriting expense provisions, including all data and judgments made, and a description of the method used to select the amounts. Filers shall also provide at least a three-year history of expenses as reported in applicable NAIC Annual Statement exhibits;
12. Reinsurance costs, if applicable, including all data and judgments made, and an explanation of how the costs were determined;
13. Residual market load, if applicable, including all data and judgments made, and an explanation of how the costs were determined; and
14. Profit and contingency provision, including all data and judgments made, and an explanation of how the provision was determined.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.5 - Limitation on filer's rate request

Current through Register Vol. 56, No. 14, July 15, 2024
(a) If the overall indicated change as determined in 11:2-42.4 is an increase of five percent or more, the filer shall request an overall increase of no more than five percent.
(b) If the overall indicated change as determined by 11:2-42.4 is less than five percent, the filer shall request no more than the overall rate change that is indicated.
(c) A filer may not have more than one rate change request pursuant to this subchapter approved in any 12-month period.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.6 - Review; general principles; actions

Current through Register Vol. 56, No. 14, July 15, 2024
(a) If the Commissioner determines that the filing will not produce rates that are excessive, inadequate for the safety and soundness of the insurer, or unfairly discriminatory between risks in this State involving substantially the same hazards and expense elements, then the Commissioner shall approve the filing.
(b) A filing will be deemed submitted when it is received by the Office of Property and Casualty in the Department and is accompanied by all of the documents, exhibits and calculations required by this subchapter.
(c) After a filing has been submitted in accordance with (b) above, the Department, within 20 days of receipt, shall conduct a preliminary review to determine if it is in compliance with N.J.S.A. 17:36-5.3 5 and this subchapter. If the filing is in compliance, it shall be deemed complete by the Department. If a filing is not in compliance, the filer will be notified of deficiencies in the filing within 20 days of receipt. If the filer is not notified of deficiencies within 20 days of receipt, it shall be deemed complete and be under review. If the filing is found to have deficiencies, it shall not be deemed complete until such deficiencies have been corrected.
(d) The Commissioner shall render a decision within 30 days of receipt of a complete filing.
(e) The Commissioner, pursuant to (a) above and N.J.S.A. 17:3-5.3 5, shall render one of the following determinations on the filing:
1. Approve the rate change filing as filed;
2. Disapprove the rate change filing; or
3. Approve a modified rate change filing.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.7 - Hurricane deductibles; standard policy language

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The uniform policy language that shall be utilized for all mandatory and optional hurricane deductible programs for homeowners' insurance is as set forth in Exhibit D in the Appendix to this subchapter, incorporated herein by reference.
(b) Insurers or the FAIR Plan, to the extent they are using policy forms which have a hurricane deductible provision that is not substantially similar with the language in Exhibit D, shall file appropriate changes to their forms to conform with the requirements set forth herein within 60 days from the effective date of this subchapter, as well as a certification regarding compliance with the notice requirements as set forth in (c) below. Such changes shall become effective at the next policy renewal. For purposes of this subsection, "substantially similar" means the applicable hurricane deductible language shall be the same in effect and application as the provision in Exhibit D, although the exact wording may be different.
(c) If an insurer or the FAIR Plan is utilizing a hurricane deductible provision that is substantially similar as set forth herein, the insurer or FAIR Plan shall file a certification to that effect with the Department, signed by an individual authorized to sign such a certification on behalf of the insurer or FAIR Plan. The certification shall also state that the notice accompanying the hurricane deductible satisfies the requirements set forth in 11:2-42.8.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.9 - Application of hurricane deductibles

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Insurers and the FAIR Plan may file to use mandatory hurricane deductibles of up to five percent and optional hurricane deductibles up to 10 percent.
(b) Hurricane deductibles may be used in areas designated by the ZIP codes set forth in Exhibit E in the Appendix to the subchapter, incorporated herein by reference. In addition, subject to approval by the Department, insurers and the FAIR Plan may file to use hurricane deductibles as set forth in (a) above in areas not designated by the ZIP codes set forth in Exhibit E. In determining whether to approve a request to apply mandatory and/or offer optional hurricane deductibles in areas beyond those set forth in Exhibit E, the Department shall consider:
1. An insurer's exposure to catastrophic hurricane losses, associated reinsurance costs, and potential impacts to the insurer's solvency;
2. Associated reinsurance costs; and
3. Potential impacts to the insurer's solvency.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 42 - HOMEOWNERS INSURANCE: STANDARD HURRICANE DEDUCTIBLES AND EXPEDITED PROCESS FOR HOMEOWNERS INSURANCE RATE CHANGES › Section 11:2-42.10 - Reports

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Insurers and the FAIR Plan shall, semi-annually, submit reports relative to the amount of in-force and new business homeowner's insurance written. The reports shall be submitted in accordance with a format which shall be posted on the Department's website:
http://www.state.nj.us/dobi
. Surplus lines agents shall file information with respect to the placement of such coverage with surplus lines insurers.
(b) Reports shall be due January 31 and July 31 for evaluation dates of the previous December 31 and June 30, respectively.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 43 - TREATMENT OF ALLOCATED DEPOSIT-TYPE DEFERRED ANNUITY CONTRACT FUNDS FOR PURPOSES OF CALCULATING THE SPECIAL PURPOSE APPORTIONMENT AND THE FRAUD ASSESSMENT › Section 11:2-43.1 - Purpose and scope

Current through Register Vol. 56, No. 14, July 15, 2024
(a) This subchapter sets forth procedures for the treatment of allocated deposit-type funds for purposes of determining an insurer's annuity premium subject to the special purpose apportionment and the fraud assessment.
(b) This subchapter shall apply to any insurer seeking to exclude allocated deposit-type funds from application of the special purpose apportionment or fraud assessment.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 43 - TREATMENT OF ALLOCATED DEPOSIT-TYPE DEFERRED ANNUITY CONTRACT FUNDS FOR PURPOSES OF CALCULATING THE SPECIAL PURPOSE APPORTIONMENT AND THE FRAUD ASSESSMENT › Section 11:2-43.2 - Definitions

Current through Register Vol. 56, No. 14, July 15, 2024
The following words and terms, as used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise.
"Allocated deposit-type funds" means funds received by a life insurance company under deferred annuity contracts that have an identifiable life to which the funds are applied and that contain a mortality or morbidity risk.
"Commissioner" means the Commissioner of the New Jersey Department of Banking and Insurance.
"Department" means the New Jersey Department of Banking and Insurance.
"Fraud assessment" means the assessment on companies by the Commissioner pursuant to N.J.S.A. 17:33A-8g.
"Special purpose apportionment" means the apportionment made on companies pursuant to 17:1C-19 et seq.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 43 - TREATMENT OF ALLOCATED DEPOSIT-TYPE DEFERRED ANNUITY CONTRACT FUNDS FOR PURPOSES OF CALCULATING THE SPECIAL PURPOSE APPORTIONMENT AND THE FRAUD ASSESSMENT › Section 11:2-43.3 - Treatment of allocated deposit-type funds for purposes of calculating the special purpose apportionment and the fraud assessment

Current through Register Vol. 56, No. 14, July 15, 2024
(a) For purposes of calculating the special purpose apportionment and the fraud assessment, an insurer authorized or admitted to transact annuity business pursuant to Title 17B of the New Jersey Statutes may have excluded from amounts reported as "annuity considerations" in the annual statement filed pursuant to 17B:21-1, those amounts that constitute allocated deposit-type funds.
(b) Any insurer seeking to have amounts excluded pursuant to (a) above shall complete and file the certification set forth in the Appendix to this subchapter, incorporated herein by reference. Certifications shall be filed with the insurer's annual statement filed pursuant to 17B:21-1 and shall be deemed to be a part of the insurer's annual statement.
1. All references in the Appendix to particular lines or columns in the annual statement shall be deemed to refer to the corresponding appropriate line or column in the annual statement in use at the time such statement is filed.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 43 - TREATMENT OF ALLOCATED DEPOSIT-TYPE DEFERRED ANNUITY CONTRACT FUNDS FOR PURPOSES OF CALCULATING THE SPECIAL PURPOSE APPORTIONMENT AND THE FRAUD ASSESSMENT › Section 11:2-43.4 - Credit

Current through Register Vol. 56, No. 14, July 15, 2024
An insurer may file a certification with respect to its annuity business based on the amounts reported on its 2002 Schedule T to seek an adjustment in amounts previously paid. To the extent the certification demonstrates a change in the annuity premium amount to which the special purpose apportionment and the fraud assessment apply, the Department shall recalculate the insurer's special purpose apportionment and fraud assessment for that year. Any amounts that may be excluded pursuant to this subchapter shall be deducted from the insurer's premium on which future apportionments and assessments, as applicable, are based. The credit shall be taken over a period of not less than three years. Credit may be taken by an affiliate of the insurer. For good cause shown, the Commissioner may allow the credit to be taken over a period of less than three years. For purposes of this rule, good cause shown shall include, but not be limited to, where the amount of the credit is de minimis with respect to the insurer seeking the credit, where the insurer is or may be placed in a hazardous financial condition, or to preserve the assets of an insurer in rehabilitation, liquidation or administrative supervision.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 43 - TREATMENT OF ALLOCATED DEPOSIT-TYPE DEFERRED ANNUITY CONTRACT FUNDS FOR PURPOSES OF CALCULATING THE SPECIAL PURPOSE APPORTIONMENT AND THE FRAUD ASSESSMENT › Section 11:2-43.5 - Penalties

Current through Register Vol. 56, No. 14, July 15, 2024
Failure to comply with the provisions of this subchapter may result in the imposition of penalties as authorized by law, including, but not limited to, penalties authorized pursuant to 17B:21-1 and 17B:21-2.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 2 - INSURANCE GROUP › Subchapter 43 - TREATMENT OF ALLOCATED DEPOSIT-TYPE DEFERRED ANNUITY CONTRACT FUNDS FOR PURPOSES OF CALCULATING THE SPECIAL PURPOSE APPORTIONMENT AND THE FRAUD ASSESSMENT › Appendix - APPENDIX

Current through Register Vol. 56, No. 14, July 15, 2024
CERTIFICATION OF ALLOCATED DEPOSIT-TYPE FUNDS
SPECIAL PURPOSE APPORTIONMENT AND FRAUD ASSESSMENT FOR YEAR ENDED DECEMBER 31, ......
Company Name: ......... Company NAIC No. ......
1.
Annuity Considerations (State Business Page, Line 2, Column 5)
.........
2.
Allocated Deposit-Type Deferred Annuity Contract Funds
.........
Included in Line 1 above
3.
Prior Year Annuitizations or Immediate Annuities not included
.........
in Line 1 above or not previously included in the assessment
base.
4.
Dividends to Policyholders (State Business Page, Line 7.1 +
.........
Line 7.3, Column 5)
5.
Net Annuity Considerations Subject to Assessment (Line 1 -
.........
Line 2 + Line 3 - Line 4)
CERTIFICATION
The undersigned certifies that (s)he is authorized to file this information on behalf of (Company Name) and that the information contained herein is correct to the best of his/her knowledge, information and belief.
(Signature) ..................................
Type or print name ...........................
Title ........................................
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.1 - Purpose and scope

Current through Register Vol. 56, No. 14, July 15, 2024
(a) This subchapter establishes a plan pursuant to
N.J.S.A. 17:29D-1
:
1. To provide personal private passenger automobile insurance coverage for automobiles owned or operated by qualified applicants subject to the conditions stated; and
2. To provide insurance coverage for all motor vehicles other than private passenger vehicles owned or operated by qualified applicants, subject to the conditions stated.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.3 - Creation of the plan

Current through Register Vol. 56, No. 14, July 15, 2024
(a) There is created in the State of New Jersey a plan for the administration and apportionment of automobile insurance for qualified applicants to be known as the New Jersey Automobile Insurance Plan.
(b) The AIP shall be administered by a Governing Committee pursuant to this subchapter and a plan of operation approved by the Commissioner.
(c) The administrative offices of the AIP shall be located within the State of New Jersey.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.4 - Governing Committee

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The AIP shall be administered by a Governing Committee of 18 members. No employee of a voluntary market automobile insurer that is not actively writing automobile insurance or that has filed and received approval of an application to withdraw from writing automobile insurance in New Jersey shall be eligible to serve as a member of the Governing Committee.
1. Eleven members shall be salaried employees of an insurer that is a participant in AIP.
2. Four members shall be licensed producers.
3. Two members shall be public representatives who are knowledgeable about automobile insurance matters but who are not employed by, or otherwise affiliated with, insurers, insurance producers, or other entities of the insurance industry.
4. The Commissioner shall be an ex-officio, non-voting member of the Governing Committee. The Commissioner may designate an alternate.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.5 - AIP plan of operation

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The AIP plan of operation shall provide for the prompt and efficient provision of automobile insurance to qualified applicants. The AIP plan of operation shall provide for, among other matters:
1. The internal organization and proceedings of the Governing Committee;
2. Standards and procedures for:
i. The appointment, compensation, and termination of producers, the AIP manager, and other employees, professionals, and contractors required to administer the AIP;
ii. The appointment, compensation, and termination of LAD carriers (consistent with any requirements established by regulation by the Commissioner); and
iii. The standards and procedures for the number, selection, appointment, compensation, and termination of CAIP servicing carriers; and the distribution of assignments to those servicing carriers.
3. Performance standards for insurers, producers, LAD carriers, CAIP servicing carriers, the AIP manager, and other employees, professionals, and contractors required to administer the AIP;
4. A producer certification program, which may not exclude producers with no affiliation with a voluntary market insurer;
5. The extent of coverage to be offered by AIP to qualified applicants;
6. Premium rules, surcharges, and minimum premiums;
7. Procedures to apply for coverage;
8. Commissions to be paid producers;
9. Procedures for cancellation or the nonrenewal of policies;
10. Methods and means for the collection, investment, and disbursement of funds;
11. Procedures for handling CAIP premium charge-offs;
12. Procedures for the performance of preliminary premium audits on certain risks identified by the Governing Committee and approved by the Commissioner;
13. Procedures for a CAIP servicing carrier performance audit program;
14. Procedures for the provision of coverage to good faith applicants where a producer has violated plan rules;
15. Development of a basic CAIP servicing carrier contract, procedures for making modifications to that contract and the establishment of a specified term to that contract, which term shall not exceed five years;
16. Development and maintenance of a statistical plan and manuals incorporating that plan, which shall be subject to the prior approval by the Commissioner in the same manner as the AIP plan of operation; and
17. Such other provisions as are deemed necessary by the Governing Committee for the operation of the AIP.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.6 - PAIP exemptions

Current through Register Vol. 56, No. 14, July 15, 2024
(a) Every insurer shall participate in the PAIP to the extent required by this subchapter and the AIP plan of operation.
(b) The requirements of this subchapter shall not apply to the following:
1. Insurers that have not issued or renewed policies of private passenger automobile insurance in New Jersey since December 31, 1983;
2. Insurers that have issued or renewed policies of private passenger automobile insurance in New Jersey since December 31, 1983, but only in accordance with a commercial lines rating system filed and approved pursuant to N.J.S.A. 17:29AA-1et seq.;
3. Insurers transacting private passenger automobile insurance business in New Jersey subject to a plan of orderly withdrawal approved in accordance with N.J.A.C. 11:2-29, but only to the extent that waiver of participation in the PAIP is explicitly provided by the terms of the approved plan of orderly withdrawal; or
4. Insurers transacting private passenger automobile insurance business in New Jersey subject to an order issued by the Commissioner in accordance with
N.J.S.A. 17:33B-23
and 24, but only to the extent provided by the terms of the order.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.7 - PAIP eligibility

Current through Register Vol. 56, No. 14, July 15, 2024
(a) PAIP shall provide coverage to all PAIP qualified applicants as set forth in the AIP plan of operation. For purposes of this subchapter, a "qualified applicant" shall include:
1. A person domiciled in New Jersey, who is an owner of an automobile registered and principally garaged in this State or will be registered and principally garaged in this State within 60 days; and
2. A person who certifies, in the prescribed application form approved by the Commissioner, that he or she has attempted, within 60 days prior to the date of application, to obtain automobile insurance in the State and that he or she is a qualified applicant as set forth in this section and (b) and (c) below. An applicant so certifying shall be considered for assignment upon submitting a complete application in good faith to the PAIP. An application shall be considered to have been made in good faith if the applicant reports all information of a material nature and does not willfully make incorrect or misleading statements in the prescribed application form.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.8 - PAIP coverage

Current through Register Vol. 56, No. 14, July 15, 2024
(a) PAIP shall provide to PAIP qualified applicants bodily injury liability, property damage liability, personal injury protection, uninsured/underinsured motorists, and physical damage coverages at the minimum levels required by law, including all options related thereto.
(b) PAIP shall provide a variety of increased limits for the above coverages up to the following:
1. $ 250,000 per person/$ 500,000 per accident for bodily injury liability coverage, and $ 100,000 for property damage liability coverage, or a combined single limit of $ 500,000 for bodily injury liability and property damage liability coverage;
2. $ 250,000 per person/$ 500,000 per accident for uninsured/underinsured motorists bodily injury liability coverage and $ 100,000 for uninsured/underinsured motorists property damage liability coverage, or a combined single limit of $ 500,000 for uninsured/underinsured bodily injury liability and property damage liability coverages.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.9 - Determination and fulfillment of PAIP quotas

Current through Register Vol. 56, No. 14, July 15, 2024
(a) With respect to PAIP risks only, the Governing Committee shall establish procedures in the plan of operation to distribute risks eligible for coverage to insurers on an equitable basis based on the proportion that the insurer's share of the voluntary market for personal private automobile insurance relates to the Statewide total of the voluntary market for personal private passenger automobile insurance in the State.
1. The PAIP shall not provide insurance coverage for more than 10 percent of the aggregate number of private passenger automobile non-fleet exposures being written in the total private passenger automobile insurance market in this State.
2. The PAIP shall cease acceptance of applications for new policies upon certification by the Commissioner that the Plan has reached or exceeded 10 percent of the private passenger automobile non-fleet exposures.
3. The PAIP shall resume acceptance of applications for new policies upon certification by the Commissioner that the PAIP is insuring less than 10 percent of the aggregate number of private passenger automobile non-fleet exposures being written in the total private passenger automobile market in the State.
4. Each insurer shall receive credit against its respective portion of assigned risks for private passenger automobile risks written voluntarily in the State that are garaged in the urban enterprise zones (UEZs). Such credits shall be in an amount established in the AIP plan of operation.
5. In order to encourage the writing of risks in traditionally underserved areas, the PAIP shall, in its allocation of credits as set forth in the AIP plan of operation, consider the loss ratio of the municipality, identified by zip code, in which the risk is located. The loss ratios for municipalities shall be established by the Department from data compiled by the statistical agents and shall be included in the AIP plan of operation.
6. No insurer whose surplus, as regards policyholders, is less than $ 1,500,000, as reported on page three of the most recent statutory annual statement, shall be assigned a risk requesting or required by law to carry limits of liability in excess of 50/100/10 or in excess of a combined single limit of $ 100,000.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.10 - CAIP qualifications

Current through Register Vol. 56, No. 14, July 15, 2024
(a) CAIP shall provide coverage to all CAIP qualified applicants as set forth in the AIP plan of operation. For the purposes of this section, a "CAIP qualified applicant" means the owner or registrant of a motor vehicle registered in New Jersey or to be registered within 60 days who is unable to obtain automobile insurance in New Jersey in the voluntary market and is not in good faith qualified for automobile insurance coverage in any residual market mechanism created by statute other than the CAIP. For multi-state operations, the applicant must have its operating headquarters in New Jersey but vehicles may be registered in other states. No applicant shall be deemed qualified if the principal operator of the vehicle to be insured does not hold a driver's license which is valid in New Jersey, or if a regular operator of the vehicle other than the principal operator does not hold such a license.
(b) As a prerequisite for insurance from CAIP, a prospective insured must attempt, within 60 days prior to the date of application, to obtain automobile insurance in New Jersey, and be unable to obtain such insurance. The prospective insured must certify, in the application form prescribed by CAIP, that the applicant has attempted, but has been unable, to obtain automobile insurance in New Jersey through ordinary methods. An applicant so certifying shall be considered for assignment upon making an application in good faith to the CAIP. An application shall be considered in good faith if he or she reports all information of a material nature and does not willfully make incorrect or misleading statements of a material nature in the prescribed application form approved by the Commissioner.
(c) For any risk consisting of 10 or more vehicles, the applicant must also provide:
1. A copy of the notice of cancellation or nonrenewal from the applicant's previous insurer, or an explanation concerning why the applicant was not insured; and
2. A certification that the applicant has been refused insurance within 60 days of the date of application from at least three named insurers licensed to transact automobile business in New Jersey. Such certification shall list the three insurers.
New Jersey Administrative Code › Title 11 - INSURANCE › Chapter 3 - AUTOMOBILE INSURANCE › Subchapter 1 - COMMERCIAL AUTOMOBILE INSURANCE PLAN › Section 11:3-1.11 - CAIP coverage

Current through Register Vol. 56, No. 14, July 15, 2024
(a) CAIP shall provide to CAIP qualified applicants, bodily injury liability and property damage liability coverages as follows:
1. CAIP shall provide basic combined single limit of $ 35,000 and statutory uninsured motorist coverage except:
i. When limits in excess of the basic combined single limit of $ 35,000 are required by law, the plan shall offer limits adequate to comply with the minimum requirements of that law, except with respect to limits over $ 5 million in which case excess coverage is conditioned upon the plan being able to secure facultative reinsurance. CAIP shall provide a policy for limits less than the minimum requirements of the law when evidence of adequate excess insurance is provided by the producer or the insured.
ii. CAIP shall provide limits adequate to comply with the provisions of the financial responsibility law of any state in which the motor vehicle will be operated, but only while the vehicle is being operated in that state.
iii. CAIP shall also offer the optional limits of liability as specified in the AIP plan of operation.