La. Admin. Code tit. 37 § XIII-3701
Current through Register Vol. 50, No. 9, September 20, 2024
Section XIII-3701 - PreambleA. The Department of Insurance recognizes that insurers possessing a certificate of authority routinely enter into reinsurance agreements that yield legitimate relief to the ceding insurer from strain to surplus.B. However, it is improper for an insurer possessing a certificate of authority in the capacity of ceding insurer, to enter into reinsurance agreements for the principal purpose of producing significant surplus aid for the ceding insurer, typically on a temporary basis, while not transferring all of the significant risks inherent in the business being reinsured. In substance or effect, the expected potential liability to the ceding insurer remains basically unchanged by the reinsurance transaction, notwithstanding certain risk elements in the reinsurance agreement, such as catastrophic mortality or extraordinary survival.La. Admin. Code tit. 37, § XIII-3701
Promulgated by the Department of Insurance, Office of the Commissioner, LR 21:1246 (November 1995).AUTHORITY NOTE: Promulgated in accordance with R.S. 22, Section 2(H)