S.D. Admin. R. 20:06:30:14.1

Current through Register Vol. 50, page 159, June 17, 2024

Section 20:06:30:14.1 - Adjustments for other reinsurance treaties

The adjustments for other reinsurance treaties may only be made with respect to reinsurance treaties entered into directly by the ceding insurer. The ceding insurer may not make no adjustment as a result of a retrocession treaty entered into by the assuming insurers.

The required level of primary security resulting from application of the actuarial method may not exceed the amount of statutory reserves ceded.

If the ceding insurer cedes risks with respect to a covered policy, including any riders, in more than one reinsurance treaty subject to §§ 20:06:30:13 to 20:06:30:20, inclusive, the aggregate required level of primary security for those reinsurance treaties may not be less than the required level of primary security calculated using the actuarial method as if all risks ceded in those treaties were ceded in a single treaty subject to §§ 20:06:30:13 to 20:06:30:20, inclusive; and

If a reinsurance treaty subject to §§ 20:06:30:13 to 20:06:30:20, inclusive, cedes risk on both covered and non-covered policies, credit for the ceded reserves must be determined as follows:

(1) The actuarial method shall be used to determine the required level of primary security for the covered policy, and § 20:06:30:16 shall be used to determine the credit for reinsurance for the covered policy reserves; and

(2) Credit for the non-covered policy reserves shall be granted only to the extent that security, in addition to the security held to satisfy the requirements of subdivision 20:06:3014.1(1), is held by or on behalf of the ceding insurer in accordance with SDCL Ch. 58-26. Any primary security used to meet the requirements of this subdivision may not be used to satisfy the required level of primary security for the covered policy.

S.D. Admin. R. 20:06:30:14.1

49 SDR 009, effective 8/9/2022

General Authority: SDCL 58-14-17.

Law Implemented: SDCL 58-14-17.