Section 58-14-16.25 - Credit for reinsurance for reinsurers in reciprocal jurisdictions-Adequate assurances requiredAn assuming insurer under § 58-14-16.23 shall agree in writing to provide adequate assurance to the director, in a form prescribed by the director, as follows:
(1) The assuming insurer shall provide prompt written notice and explanation to the director if the assuming insurer falls below the minimum requirements set forth in § 58-14-16.24, or if any regulatory action is taken against the assuming insurer for serious noncompliance with applicable law;(2) The assuming insurer shall consent in writing to the jurisdiction of the courts of this state and to the appointment of the director as agent for service of process. The director may require that consent for service of process be provided to the director and included in each reinsurance agreement. Nothing in this subdivision limits or alters the capacity of parties to a reinsurance agreement to agree to alternative dispute resolution mechanisms, except to the extent such agreements are unenforceable under applicable insolvency or delinquency laws;(3) The assuming insurer shall consent in writing to pay all final judgments wherever enforcement is sought as obtained by a ceding insurer or its legal successor that have been declared enforceable in the jurisdiction where the judgment was obtained;(4) Each reinsurance agreement must include a provision requiring the assuming insurer to provide security in an amount equal to one hundred percent of the assuming insurer's liabilities attributable to reinsurance ceded pursuant to that agreement if the assuming insurer resists enforcement of a final judgment that is enforceable under the law of the jurisdiction in which it was obtained or a properly enforceable arbitration award, whether obtained by the ceding insurer or by its legal successor on behalf of its resolution estate;(5) The assuming insurer shall confirm that it is not presently participating in any solvent scheme of arrangement that involves this state's ceding insurers and shall agree to notify the ceding insurer and the director and to provide security in an amount equal to one hundred percent of the assuming insurer's liabilities to the ceding insurer if the assuming insurer enters into such a solvent scheme of arrangement. Such security shall be in a form consistent with the provisions of this chapter. For purposes of this section, the term, solvent scheme of arrangement, means a foreign or alien statutory or regulatory compromise procedure subject to requisite majority creditor approval and judicial sanction in the assuming insurer's home jurisdiction either to finally commute liabilities of duly noticed classed members or creditors of a solvent debtor, or to reorganize or restructure the debts and obligations of a solvent debtor on a final basis, and which may be subject to judicial recognition and enforcement of the arrangement by a governing authority outside the ceding insurer's home jurisdiction; and(6) An assuming insurer's supervisory authority shall confirm to the director on an annual basis, as of the preceding December thirty-first or at the annual date otherwise statutorily reported to the reciprocal jurisdiction, that the assuming insurer complies with the requirements of § 58-14-16.24.Nothing in this section precludes an assuming insurer from providing the director with information on a voluntary basis.
Added by S.L. 2021, ch. 211,s. 3, eff. 7/1/2021.