Section 230-RICR-20-45-7.2 - PurposeA. The purpose of this Regulation is to improve the Rhode Island Insurance Division's surveillance of the financial condition of insurers by requiring:1. An annual audit of financial statements reporting the financial position and the results of operations of insurers by independent Certified Public Accountants,2. Communication of Internal Control Related Matters Noted in an Audit, and3. Management's Report of Internal Control over Financial Reporting.B. Every insurer (as defined in § 7.3 of this Part) shall be subject to this Regulation. Insurers having direct premiums written in this state of less than one million dollars ($1,000,000.00) in any calendar year and less than one thousand (1,000) policyholders or if certificate holders of direct written policies nationwide at the end of such calendar year shall be exempt from this Regulation for such year (unless the Commissioner makes a specific finding that compliance is necessary for the Commissioner to carry out statutory responsibilities) except that insurers having assumed premiums pursuant to contracts and/or treaties of reinsurance of one million dollars ($1,000,000.00) or more will not be so exempt.C. Foreign or alien insurers filing the audited financial report in another State, pursuant to such other State's requirement for filing of audited financial reports, which has been found by the Commissioner to be substantially similar to the requirements herein, are exempt from §7.4-7.13 of this Part if: 1. A copy of the audited financial report, Communication of Internal Control Related Matters Noted in an Audit, and the accountant's Letter of Qualifications which are filed with such other State are filed with the Commissioner in accordance with the filing dates specified in §§ 7.4, 7.11 and 7.12 of this Part, respectively (Canadian insurers may submit accountants' reports as filed with the Office of the Superintendent of Financial Institutions, Canada).2. A copy of any Notification of Adverse Financial Condition Report filed with such other state is filed with the Commissioner within the time specified in § 7.10 of this Part.D. Foreign or alien insurers required to file Management's Report of Internal Control over Financial Reporting in another state are exempt from filing the Report in this State provided the other state has substantially similar reporting requirements and the Report is filed with the commissioner of the other state within the time specified.E. This Regulation shall not prohibit, preclude or in any way limit the Commissioner from ordering and/or conducting and/or performing examinations of insurers under the Rules and Regulations of the Rhode Island Division of Insurance and the practices and procedures of the Rhode Island Division of Insurance.230 R.I. Code R. 230-RICR-20-45-7.2
Amended effective 8/11/2021