An Act To Update the Maine Insurance Code To Maintain Conformance with Uniform National Standards
PART A
Sec. A-1. 24-A MRSA §216, sub-§5, as amended by PL 1999, c. 184, §19, is repealed and the following enacted in its place:
(1) Specify procedures and protocols regarding the confidentiality and security of information shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries pursuant to this paragraph, including procedures and protocols for sharing by the National Association of Insurance Commissioners with other state, federal or international insurance regulators;
(2) Specify that ownership of information shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries pursuant to this paragraph remains with the superintendent and that the use of information by the National Association of Insurance Commissioners is subject to the direction of the superintendent;
(3) Require prompt notice to be given by the National Association of Insurance Commissioners to any insurer whose confidential information is in the possession of the National Association of Insurance Commissioners pursuant to this paragraph when that information is the subject of a request or subpoena for disclosure or production; and
(4) Require the National Association of Insurance Commissioners and its affiliates and subsidiaries to consent to intervention by an insurer in any judicial or administrative action in which the National Association of Insurance Commissioners and its affiliates and subsidiaries may be required to disclose confidential information about the insurer shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries pursuant to this paragraph.
Sec. A-2. 24-A MRSA §222, sub-§1, as repealed and replaced by PL 1975, c. 356, §1, is repealed.
Sec. A-3. 24-A MRSA §222, sub-§1-A is enacted to read:
(1) Any business entity structured to hold the stock of an insurance company, or person holding the shares of voting stock or policyholder proxies of an insurer as voting trustee or otherwise, for the purpose of controlling the management thereof;
(2) Any insurance producer, adjuster or consultant or other insurance or reinsurance representative or intermediary or any person acting as or purporting to be any of the foregoing;
(3) Any person having a contract giving that person by terms or in fact the exclusive or dominant right to manage or control the insurer; and
(4) Any person in this State engaged in or proposing to be engaged in or acting as or purporting to be so engaged or proposing to be engaged in the business of insurance or in this State assisting in the promotion, formation or financing of an insurer or insurance holding corporation or corporation or other group financing an insurer or the production of its business.
Sec. A-4. 24-A MRSA §222, sub-§2, ¶B, as amended by PL 1999, c. 113, §8, is further amended to read:
(1) 'Control,' including 'controlling,' 'controlled by' and 'under common control with,' "Control," including "controlling," "controlled by" and "under common control with," means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or nonmanagement services, or otherwise, unless the power is solely the result of an official position with or a corporate office held by the person. Control is presumed to exist if any person is the beneficial owner of 10% or more of the voting securities or guaranty capital shares, if applicable, or voting rights in the case of mutual or reciprocal insurers, or guaranty capital shares if a mutual insurer has established a guaranty fund, has the right to cast 10% or more of the votes in the election of directors or other governing body of any other person. A beneficial owner may rely in determining the amount of voting securities of any person outstanding upon information set forth in that person's most recent quarterly or annual report filed with the Securities and Exchange Commission pursuant to the Exchange Act unless the beneficial owner knows or has reason to believe that the information contained in the quarterly or annual report is inaccurate. Two or more domestic mutual insurance companies that have restricted their licensed territories to the State are not considered subject to this section merely because those insurance companies commonly share facilities, incurred expenses , or personnel services , or otherwise utilize cost allocations based on generally accepted accounting principles including pro rata sharing of assumed risks. A person may have more than one controlling person, even if those controlling persons are not acting in concert.
(2) Notwithstanding the presumption of control contained in subparagraph (1), the superintendent, upon application of the insurance company, may determine that the insurer is not controlled by the person presumed to control it. In addition, the superintendent, after notice and an opportunity to be heard, may determine, notwithstanding the absence of the presumption in subparagraph (1), that a person does control an insurance company or companies.
(3) The presumption of control contained in subparagraph (1) does not apply to a securities broker-dealer holding, in the usual and customary broker's function, less than 20% of the voting securities of another person. However, such a broker-dealer shall disclose to the superintendent the identity of any person, or group of persons the broker-dealer knows or reasonably believes to be acting in concert, on whose behalf the broker-dealer holds 5% or more of the voting securities of a domestic insurer or any entity the broker-dealer knows or reasonably believes to be a controlling person of a domestic insurer and shall disclose to the superintendent on request the beneficial owners of any securities held by the broker-dealer of any entity that is, or that the superintendent believes might be or might become, a member of the insurance holding company system of an insurer subject to registration under subsection 8.
Sec. A-5. 24-A MRSA §222, sub-§2, ¶B-1, as enacted by PL 1989, c. 385, §3, is repealed and the following enacted in its place:
Sec. A-6. 24-A MRSA §222, sub-§2, ¶B-2 is enacted to read:
Sec. A-7. 24-A MRSA §222, sub-§2, ¶D, as repealed and replaced by PL 1975, c. 356, §1, is amended to read:
Sec. A-8. 24-A MRSA §222, sub-§2, ¶¶D-3 to D-5 are enacted to read:
Sec. A-9. 24-A MRSA §222, sub-§4-A, as enacted by PL 1989, c. 385, §5, is repealed.
Sec. A-10. 24-A MRSA §222, sub-§4-B, as enacted by PL 1989, c. 385, §5, is repealed.
Sec. A-11. 24-A MRSA §222, sub-§4-C is enacted to read:
(1) The person has filed with the superintendent and has sent the domestic insurer an application containing the information required by paragraph C;
(2) The offer, request, invitation, agreement or acquisition has been approved by the superintendent in the manner prescribed in subsection 7; and
(3) Ten days has elapsed from the date of approval by the superintendent and no injunction or other court order precludes consummation of the offer, request, invitation, agreement or acquisition.
(1) The name and address of each person by whom or on whose behalf the merger or other acquisition of control is to be effected and:
(a) If the person acquiring control is an individual, the person's principal occupation and all offices and positions held during the past 5 years and any convictions for crimes other than minor traffic violations during the past 10 years; and
(b) If the person acquiring control is not an individual, a report of the nature of its business operations during the past 5 years or for a lesser period the person and any predecessors have been in existence; an informative description of the business intended to be done by the person and the person's subsidiaries; and a list of all individuals who are or who have been selected to become directors or executive officers of the person or who perform or will perform functions appropriate to such positions. The list must include the information required by division (a) for each individual listed;
(2) The source, nature and amount of the consideration used or to be used in effecting the merger or other acquisition of control, a description of any transaction through which funds were or are to be obtained for any such purpose, including any pledge of the insurer's stock or the stock of any of its subsidiaries or controlling affiliates, and the identity of persons furnishing consideration. If a source of consideration is a loan made in the lender's ordinary course of business, the identity of the lender is confidential if the person filing the application so requests;
(3) Fully audited financial information as to the earnings and financial condition of each acquiring person for the preceding 5 fiscal years, or for a lesser period if the acquiring person and any predecessors have been in existence for less than 5 years, and similar unaudited information as of a date not earlier than 90 days before the filing of the application;
(4) Any plans or proposals that each acquiring person may have to liquidate the insurer, to sell its assets or merge or consolidate it with any person or to make any other material change in its business or corporate structure or management;
(5) The number of shares of any security referred to in paragraph A that each acquiring person proposes to acquire, the terms of the offer, request, invitation, agreement or acquisition referred to in paragraph A and a statement as to the method by which the fairness of the proposal was arrived at;
(6) The amount of each class of any security referred to in paragraph A that is beneficially owned or concerning which there is a right to acquire beneficial ownership by each acquiring person;
(7) A full description of any contracts, arrangements or understandings with respect to any security referred to in paragraph A in which any acquiring person is involved, including but not limited to transfer of any of the securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or guarantees of profits, division of losses or profits or the giving or withholding of proxies. The description must identify the persons with whom the contracts, arrangements or understandings have been entered into;
(8) A description of the purchase by any acquiring person of any security referred to in paragraph A during the 12 calendar months preceding the filing of the application, including the dates of purchase, names of the purchasers and consideration paid or agreed to be paid;
(9) A description of any recommendations to purchase any security referred to in paragraph A made during the 12 calendar months preceding the filing of the application by any acquiring person or by anyone based upon interviews with or at the suggestion of the acquiring person;
(10) Copies of all tender offers for, requests or invitations for tenders of, exchange offers for and agreements to acquire or exchange any securities referred to in paragraph A and copies of any additional related soliciting material that has been distributed;
(11) The terms of any agreement, contract or understanding made or proposed to be made with any broker-dealer as to solicitation of securities referred to in paragraph A for tender and the amount of any fees, commissions or other compensation to be paid to broker-dealers with regard to the solicitation of securities referred to in paragraph A;
(12) An agreement by the person required to file the application to provide the annual enterprise risk report required by subsection 8, paragraph B-1 for as long as control by the person exists;
(13) An acknowledgement by the person required to file the application that the person and all subsidiaries within its control in the insurance holding company system will provide information to the superintendent upon request as necessary to evaluate enterprise risk to the insurer;
(14) A statement as to whether or not the proposed transaction will result in an increase in market share in this State in any line of insurance as specified in the annual statement required to be filed under section 423 for one or more insurers with combined market share greater than 5% and, if so, such further information on the competitive impact of the proposed transaction as the superintendent requires by rule or order; and
(15) Such additional information as the superintendent may prescribe by rule or order.
(1) The interests of the State in regulating the transaction are minimal relative to the interests of other jurisdictions or are minimal relative to the impact of the transaction as a whole;
(2) The person proposes a divestiture of control under paragraph B and the superintendent determines that the prior approval process is not necessary in the circumstances of the transaction;
(3) A party proposing to acquire presumed control submits a disclaimer fully disclosing all material relationships and bases for affiliation with the insurer and demonstrating to the satisfaction of the superintendent that the person will not be acquiring actual control. As a condition of granting an exemption under this subparagraph, the superintendent may require the person to agree to reasonable restrictions on the exercise of rights or powers that might otherwise tend to result in control;
(4) The superintendent elects to participate in a consolidated approval proceeding conducted under the laws of one or more other states pursuant to subsection 7-A, paragraph E; and
(5) The transaction involves the control of a person that is not primarily engaged in the business of insurance, directly or through its affiliates, and there will be no material impact on the management or operations of a domestic insurer.
A person requesting an exemption under this paragraph must agree to provide additional information if needed by the superintendent and to postpone the effective date of the transaction if ordered by the superintendent while the request for exemption is pending.
Sec. A-12. 24-A MRSA §222, sub-§5, as amended by PL 1989, c. 385, §6, is further amended to read:
Sec. A-13. 24-A MRSA §222, sub-§6, as amended by PL 2007, c. 466, Pt. D, §1, is further amended to read:
Sec. A-14. 24-A MRSA §222, sub-§7, as amended by PL 2007, c. 466, Pt. D, §2, is further amended to read:
(1) After the change of control, the domestic insurer could not satisfy the requirements for the issuance of a certificate of authority according to requirements in force at the time of the issuance , or last renewal or continuation of its certificate of authority to do the insurance business which that it intends to transact in this State;
(2) The effect of the purchases, exchanges, merger of a controlling person of the insurer , or other acquisitions changes of control may be substantially to lessen competition in insurance in this State or tend to create a monopoly therein; in this State or would violate the laws of this State or of the United States relating to monopolies or restraints of trade;
(3) The financial condition of an acquiring person is such as would jeopardize the financial stability of the insurer or prejudice the interest of its policyholders;
(4) The plans or proposals which that the acquiring or divesting person has to liquidate the insurer, to sell its assets or to merge it with any person, or to make any other major change in its business or corporate structure or management, are unfair or prejudicial to policyholders;
(5) The competence, experience and integrity of those persons who would control the operation of the insurer indicate that it would not be in the interest of policyholders or the public to permit them to do so;
(6) Any merger of a domestic insurer does not comply with section 3474; or
(7) The acquisition change of control would tend to affect adversely the contractual obligations of the domestic insurer or its ability and tendency to render service in the future to its policyholders and the public.
(1) Failure to file the statement application required under subsection 4-A 4-C constitutes a violation of this chapter section.
(2) Effectuation of or any attempt to effectuate an acquisition of , control of , divestiture of control of or merger with a domestic insurer within earlier than 30 days of after the filing of the statement application required by subsection 4-A, prior to 4-C, before the superintendent's decision if a hearing is held or after disapproval of such acquisition of control or merger by the superintendent of the acquisition, divestiture or merger, constitutes a violation of this chapter section.
Sec. A-15. 24-A MRSA §222, sub-§§7-A and 7-B are enacted to read:
(1) A person who would have the right to participate in a proceeding on any of the consolidated applications held under subsection 7 or substantially similar laws of other states has the right to participate in the proceeding.
(2) The chief insurance regulator of a participating state has the right to participate in making the decision or in designating a decision-making panel.
(3) The proceeding is public, except that deliberations of a decision-making panel are not public proceedings and communications in the course of those deliberations among panel members and their advisers, other than the decision itself, are not public records.
(4) The proceeding may be held in any state with a significant connection to the subject transactions or in a nearby location in an adjacent state. Sessions may be held in different states. Provision must be made for parties, witnesses, insurance regulators and members of the public to attend and participate in the proceeding by telecommunication.
(5) The superintendent, decision-making panel or presiding officer may vary the applicable procedural requirements under this Title and Title 5 to the extent the superintendent, panel or presiding officer determines to be reasonably necessary for the fair and effective administration of a consolidated multistate proceeding.
(6) The decision is subject to judicial review in the same manner as a final agency action of the superintendent.
(1) Initiating the establishment of a supervisory college or participating in a supervisory college initiated by one or more other regulators;
(2) Entering into agreements providing the basis for cooperation between the superintendent and the other participating regulators and for the activities of the supervisory college, including but not limited to agreements for sharing confidential information under section 216, subsection 5;
(3) Obtaining and providing assistance in examinations conducted under subsection 1-A or under the examination authority of other participating jurisdictions;
(4) Clarifying the membership and participation of other regulators in the supervisory college;
(5) Clarifying the functions of the supervisory college and the role of other regulators, including the designation of the superintendent or another member of the supervisory college as a group-wide supervisor;
(6) Coordinating the ongoing activities of the supervisory college, including planning meetings, supervisory activities and processes for information sharing; and
(7) Establishing a crisis management plan.
Sec. A-16. 24-A MRSA §222, sub-§8, ¶A, as amended by PL 1999, c. 113, §11, is further amended to read:
Sec. A-17. 24-A MRSA §222, sub-§8, ¶B, as amended by PL 2001, c. 72, §5, is further amended to read:
(1) The capital structure, general financial condition, ownership and management of the insurer and of any person controlling the insurer;
(1-A) The identity and relationship of every member of the insurance holding company system;
(2) The following transactions currently outstanding between the insurer and its affiliates:
(a) Loans and other investments, and purchases, sales or exchanges of securities of the affiliate by the insurer or of the insurer by its affiliates;
(b) Purchases, sales or exchanges of assets;
(c) Transactions not in the ordinary course of business;
(d) Guarantees or undertakings for the benefit of an affiliate that result in an actual contingent exposure of the insurer's assets to liability, other than insurance contracts entered into in the ordinary course of the insurer's business;
(e) All management and service contracts and all cost-sharing arrangements , other than cost allocation arrangements based upon generally accepted accounting principles;
(f) Reinsurance agreements; and
(g) Dividends and other distributions to shareholders; and
(h) Consolidated tax allocation agreements;
(2-A) Any pledge of the insurer's stock, including stock of any subsidiary or controlling affiliate, for a loan made to any member of the insurance holding company system;
(2-B) If requested by the superintendent, financial statements of or within the insurance holding company system, including all affiliates. The required financial statements may include but are not limited to annual audited financial statements filed with the United States Securities and Exchange Commission pursuant to the Exchange Act. An insurer required to file financial statements pursuant to this subparagraph may satisfy the request by providing the superintendent with the most recently filed parent corporation financial statements that have been filed with the United States Securities and Exchange Commission;
(3) Other matters concerning transactions between the insurer and any affiliate as may be required by the superintendent; and
(4) Any other information required by the superintendent by rule;
Sec. A-18. 24-A MRSA §222, sub-§8, ¶¶B-1 to B-3 are enacted to read:
(1) This paragraph does not apply if:
(a) The insurer is an agency, authority or instrumentality of the United States, its possessions and territories, the Commonwealth of Puerto Rico, the District of Columbia or a state or political subdivision of a state;
(b) The insurer and its insurance holding company system did not meet either of the minimum premium criteria of this paragraph in the financial statements immediately preceding their most recent financial statements and the superintendent has not required compliance with this paragraph under subparagraph (2); or
(c) The superintendent has granted a waiver from the requirements of this paragraph based upon unique circumstances. In deciding whether to grant a waiver, the superintendent may consider the type and volume of business written by the insurer, the ownership and organizational structure of the insurer and its insurance holding company system and any other factor the superintendent considers relevant to the insurer or the insurer's insurance holding company system. If the insurer's insurance holding company system includes insurers domiciled in more than one state, the superintendent shall coordinate with the lead regulator and with other domiciliary regulators in considering whether to grant the insurer's request for a waiver.
(2) The superintendent may require an insurer that does not meet either of the minimum premium criteria of this paragraph to comply with the requirements of this paragraph if:
(a) The superintendent determines that the insurer should be subject to this paragraph due to unique circumstances, including, but not limited to, the type and volume of business written by the insurer, the ownership and organizational structure of the insurer and its insurance holding company system, federal agency requests and international supervisor requests;
(b) The insurer is subject to a corrective order or required to adopt a risk-based capital plan under sections 6453 to 6456;
(c) The superintendent has determined in accordance with rules adopted by the superintendent that the insurer is in hazardous financial condition; or
(d) The superintendent has determined that the insurer otherwise exhibits qualities of a troubled insurer.
(3) If an insurer's insurance holding company system has annual premium of $1,000,000,000 or more, the assessment and reporting required by this paragraph must be conducted for each insurer within the insurance holding company system, either on a systemwide basis or separately for insurers or combinations of insurers within the insurance holding company system.
(4) An insurer subject to this paragraph shall maintain a risk management framework to assist the insurer with identifying, assessing, monitoring, managing and reporting on its material and relevant risks. An insurer may satisfy this requirement by participating in an applicable risk management framework maintained by the insurance holding company system of which the insurer is a member.
(5) An insurer subject to this paragraph shall prepare and submit regular ORSA summary reports that satisfy the requirements of this subparagraph and shall provide additional information to the superintendent upon request.
(a) Beginning no later than 2015, the ORSA summary report must be prepared at least annually, on a timetable consistent with the insurer's internal strategic planning processes, and submitted to the lead regulator of the insurer's insurance holding company system, as determined by the procedures within a financial analysis handbook adopted by the National Association of Insurance Commissioners. If the superintendent is not the lead regulator, the insurer shall submit the insurer's or insurance holding company system's most recent ORSA summary report to the superintendent on request.
(b) The ORSA summary report must be prepared consistent with the ORSA guidance manual. Documentation and supporting information must be maintained and made available upon examination by or upon request of the superintendent.
(c) The insurer's or insurance holding company system's chief risk officer, or other executive having responsibility for the oversight of the insurer's enterprise risk management process, shall sign the ORSA summary report attesting to the best of the signer's belief and knowledge that the insurer applies the enterprise risk management process described in the ORSA summary report and that a copy of the report has been provided to the insurer's board of directors or the appropriate committee of the board.
(d) An insurer may comply with this paragraph by providing the most recent ORSA summary report and a report or reports that are substantially similar to the ORSA summary report that are provided by the insurer or another member of its insurance holding company system to the insurance commissioner of another state or to an insurance supervisor or regulator of a foreign jurisdiction if that report provides information that is comparable to the information described in the ORSA guidance manual. Any report in a language other than English must be accompanied by an English translation.
(6) The superintendent's review of the ORSA summary report, and any additional requests for information, must be consistent with accepted regulatory procedures for the analysis and examination of multistate or global insurers and insurance groups.
Sec. A-19. 24-A MRSA §222, sub-§8, ¶C, as enacted by PL 1975, c. 356, §1, is amended to read:
Sec. A-20. 24-A MRSA §222, sub-§8, ¶I, as enacted by PL 1975, c. 356, §1, is amended to read:
(1) An approved disclaimer relieves the disclaiming person of the duty to register under this section.
(2) A disclaimer is deemed approved unless the superintendent, within 30 days after receipt of a complete disclaimer, including any additional information required by the superintendent, either disallows the disclaimer or notifies the disclaiming person that a hearing will be held on the disclaimer.
(3) The superintendent may condition the approval of a disclaimer on terms and conditions reasonably designed to ensure that the disclaiming person will not exercise actual control or acquire the right to actual control over the insurer without triggering the prior approval process under subsections 4-C and 7.
(4) If the superintendent takes action on a disclaimer without hearing, including the imposition of conditions not agreed to by the disclaiming person, an aggrieved person has the right to a hearing.
(5) The superintendent may rescind the approval of a disclaimer, after notice and opportunity for hearing, on the basis of new information or changed circumstances demonstrating the existence of control over the insurer.
Sec. A-21. 24-A MRSA §222, sub-§9, as amended by PL 1991, c. 828, §5, is further amended to read:
(1) Sales, purchases, exchanges, loans or extensions of credit, guarantees or investments that are equal to or exceed:
(a) With respect to nonlife insurers, the lesser of 3% of the insurer's admitted assets as of December 31st of the preceeding preceding year or and 25% of surplus to policyholders;
(b) With respect to life insurers, 3% of the insurer's admitted assets as of December 31st of the preceding year; or
(c) With respect to nonprofit hospital and medical service organizations and their 100% controlled affiliates that operate as monoline health insurers or health maintenance organizations, the lesser of 5% of the entity's admitted assets as of December 31st of the preceding year or and 25% of surplus to policyholders;
(2) Loans or extensions of credit to any person who is not an affiliate, if the insurer makes the loan or extension of credit with the agreement or understanding that the proceeds in whole or in substantial part , are to be used to make loans or extensions of credit to, purchase assets of or make investments in any affiliate of the insurer if the loan, extension of credit, purchase or investment is equal to or exceeds:
(a) With respect to nonlife insurers, the lesser of 3% of the insurer's admitted assets as of December 31st of the preceding year or and 25% of surplus to policyholders;
(b) With respect to life insurers, 3% of the insurer's admitted assets as of December 31st of the preceding year; or
(c) With respect to nonprofit hospital and medical service organizations and their 100% controlled affiliates that operate as monoline health insurers or health maintenance organizations, the lesser of 5% of the entity's admitted assets as of December 31st of the preceding year or and 25% of surplus to policyholders;
(3) Reinsurance All reinsurance pooling agreements or modifications to the , and all reinsurance agreements in which the reinsurance premium or a change in the insurer's liabilities , or the projected reinsurance premium or a projected change in the insurer's liabilities in any of the next 3 years, equals or exceeds 5% of the insurer's surplus to policyholders, as of December 31st of the preceding year, including those agreements that may require as consideration the transfer of assets from an insurer to a nonaffiliate if an agreement or understanding exists between the insurer and nonaffiliate that any portion of the assets will be transferred to one or more affiliates of the insurer;
(4) Management All management agreements, cost-sharing arrangements and , tax allocation agreements, service contracts that: and guaranties, with the exception of guaranties that are quantifiable in amount and do not exceed, in the aggregate, the lesser of 0.5% of admitted assets and 10% of surplus as regards policyholders as of December 31st of the preceding year;
(a) Delegate authority to effectuate reinsurance;
(b) Provide for delegated corporate governance;
(c) Provide for servicing of claims liabilities; or
(d) In any other way contribute an element of expense that is material when related to operations of the insurer;
(5) Any transactions that are part of a plan or series of like transactions with persons within the holding company system if the purpose of those separate transactions is to avoid the statutory threshold amount and thus avoid the review that would occur otherwise. If the superintendent determines that those separate transactions were entered into over any 12-month period for such a purpose, the superintendent may exercise authority under this subsection; and
(6) Any other material transactions specified by rule that the superintendent has determined may adversely affect the interests of the insurer's policyholders.
A notice of amendment or modification of a transaction must include the reasons for the change and the financial impact on the domestic insurer. The insurer shall notify the superintendent within 30 days after terminating an agreement previously reported under this paragraph.
The superintendent shall disapprove any such a transaction that is subject to this paragraph if it the transaction violates the standards of this section or other applicable law or adversely affects the interests of policyholders. The superintendent's failure to make a determination on a proposed transaction within 30 days after it has been submitted for review has the effect of an approval, unless the superintendent has issued a notice of adjudicatory hearing on the proposal in accordance with section 230.
Any violation of this subsection, in addition to the penalties contained in subsection 14, renders the transactions voidable at the initiative of the superintendent or otherwise under applicable law. The superintendent's approval of a transaction in accordance with this section, whether actual or by acquiescence, may not override any applicable law and does not operate to authorize any transaction that would be contrary to law if it involved an insurer not a member of the same holding company system.
Sec. A-22. 24-A MRSA §222, sub-§10, as amended by PL 1993, c. 313, §10, is further amended to read:
Sec. A-23. 24-A MRSA §222, sub-§11-C, ¶B, as enacted by PL 2009, c. 511, Pt. A, §5, is amended to read:
Sec. A-24. 24-A MRSA §222, sub-§12, as amended by PL 1999, c. 113, §13, is repealed.
Sec. A-25. 24-A MRSA §222, sub-§13, as amended by PL 1989, c. 385, §9, is repealed.
Sec. A-26. 24-A MRSA §222, sub-§13-A is enacted to read:
(1) Information obtained by the superintendent pursuant to an examination or investigation pursuant to subsection 1-A to the same extent as the information would have been confidential if obtained in an examination or investigation conducted under section 220 or 221;
(2) A registration statement or report filed under subsection 8, including all supporting information;
(3) A report filed under subsection 9, including all supporting information;
(4) A notice of proposed divestiture filed under subsection 4-C, paragraph B, until the divestiture transaction has occurred;
(5) A disclosure of the beneficial owner of securities made by a broker-dealer pursuant to subsection 2, paragraph B, subparagraph (3);
(6) The identity of a lender that is to finance a proposed transaction if declared confidential under subsection 4-C, paragraph C, subparagraph (2);
(7) Information filed in support of any required attestation of risk management or internal controls under subsection 4-C, paragraph C, subparagraph (12) or (13);
(8) A competitive impact statement filed under subsection 4-C, paragraph C, subparagraph (14), including all supporting information;
(9) Information obtained under an information-sharing agreement entered into pursuant to this section to the extent that it is protected by the confidentiality provisions of the agreement;
(10) Information obtained pursuant to this section from a jurisdiction other than this State to the extent that it is confidential under the laws of the jurisdiction in which it is normally maintained, if the superintendent had no way to obtain the information without the confidentiality protection; and
(11) Information obtained under this section to the extent that it is confidential under other applicable law, including, but not limited to, section 216, section 225 and Title 1, section 402, subsection 3.
(1) The recipient of the information must agree in writing to maintain the same level of confidentiality as is available under Maine law. This requirement may be satisfied throught a multilateral confidentiality agreement to which both the superintendent and the recipient are parties.
(2) If the recipient of the information is in the United States, the recipient's state must have statutes or rules that expressly protect holding company information at a level at least equivalent to the protections provided by this subsection and section 216, subsection 5.
(3) ORSA-related information subject to subsection 8, paragraph B-3 may, with the written consent of the insurer, be shared with a 3rd-party consultant under an agreement containing the conditions specified in section 216, subsection 5, paragraph C. In addition, any agreement for sharing ORSA-related information with the National Association of Insurance Commissioners or a 3rd-party consultant must further provide that:
(a) The recipient of the information agrees in writing to maintain the confidentiality and privileged status of the ORSA-related information and has verified in writing the legal authority to maintain confidentiality;
(b) Any preauthorization granted under the agreement for further sharing of information provided by the superintendent must be limited to only the domiciliary regulators of other insurers in the same insurance holding company system; and
(c) The National Association of Insurance Commissioners or a 3rd-party consultant may not store ORSA-related information shared pursuant to this subparagraph in a permanent database after the underlying analysis is completed.
Sec. A-27. 24-A MRSA §222, sub-§14, ¶A, as amended by PL 2007, c. 466, Pt. D, §3, is further amended to read:
Sec. A-28. 24-A MRSA §222, sub-§18, as amended by PL 1999, c. 113, §14, is further amended to read:
Sec. A-29. 24-A MRSA §222, sub-§19, as enacted by PL 1975, c. 356, §1, is amended to read:
Sec. A-30. 24-A MRSA §423-F is enacted to read:
§ 423-F. Own risk and solvency assessment
Sec. A-31. 24-A MRSA §1157, sub-§5, ¶D, as amended by PL 2001, c. 72, §15, is further amended to read:
Sec. A-32. 24-A MRSA §4356, sub-§§12 and 13, as enacted by PL 1969, c. 132, §1, are amended to read:
Sec. A-33. 24-A MRSA §4356, sub-§14 is enacted to read:
PART B
Sec. B-1. 24-A MRSA §601, sub-§26, as amended by PL 2003, c. 203, §1, is further amended to read:
Sec. B-2. 24-A MRSA §601, sub-§26-A is enacted to read:
Sec. B-3. 24-A MRSA §731-B, sub-§1, ¶B-1, as enacted by PL 2001, c. 47, §2, is amended to read:
(1) To apply for accreditation, a reinsurer shall file with the superintendent a written application on a form prescribed by the superintendent, accompanied by the fee prescribed in section 601, subsection 26 and an agreement to submit to the jurisdiction of the courts of this State and to the authority of the superintendent to examine the reinsurer's books and records.
(2) An accredited reinsurer must be licensed to transact insurance or reinsurance in at least one state, or in the case of a United States branch of an alien reinsurer, that reinsurer must be entered through and licensed to transact insurance or reinsurance in at least one state.
(3) An accredited reinsurer shall file with the superintendent, as part of its application and annually thereafter, a copy of its annual statement filed with the insurance department of its state of domicile or United States port of entry and a copy of its most recent audited financial statement.
(4) A reinsurer applying for accreditation that maintains a surplus as regards to policyholders in an amount not less than $20,000,000 is deemed to be accredited if the reinsurer's application is not denied by the superintendent within 90 days after submission of the application. The superintendent has the discretion to grant accreditation to an applicant with a surplus less than $20,000,000 subject to such terms and conditions as the superintendent determines to be necessary and appropriate for the protection of domestic ceding insurers and their policyholders.
The superintendent may deny, suspend, revoke or place restrictions upon a reinsurer's accreditation, after notice and opportunity for hearing, for failure to comply with the requirements of this paragraph or for any grounds that would warrant similar action against the certificate of authority of an authorized insurer.
Sec. B-4. 24-A MRSA §731-B, sub-§1, ¶B-2 is enacted to read:
(1) To be eligible for certification, the assuming insurer must meet the following requirements:
(a) The assuming insurer must be domiciled and licensed to transact insurance or reinsurance in a jurisdiction determined by the superintendent to be a qualified jurisdiction pursuant to subparagraph (3);
(b) The assuming insurer must maintain minimum capital and surplus, or its equivalent, in an amount to be determined by the superintendent pursuant to rules adopted under subsection 7;
(c) The assuming insurer must maintain financial strength ratings from 2 or more rating agencies determined by the superintendent to be acceptable pursuant to rules adopted under subsection 7;
(d) The assuming insurer must agree to submit to the jurisdiction of this State and to appoint an agent for service of process in the same manner as provided for authorized insurers under section 421 and agree to provide security for 100% of the assuming insurer's liabilities attributable to reinsurance ceded by United States ceding insurers if the assuming insurer resists enforcement of a final United States judgment;
(e) The assuming insurer must agree to meet applicable information filing requirements as determined by the superintendent, both with respect to an initial application for certification and on an ongoing basis;
(f) The assuming insurer must pay the application fee prescribed in section 601, subsection 26-A and, to the extent provided in rules adopted under subsection 7, must agree to pay reasonable costs of review; and
(g) The assuming insurer must satisfy any other requirements for certification established by the superintendent.
(2) An association including incorporated and individual unincorporated underwriters may be a certified reinsurer. In order to be eligible for certification, in addition to satisfying the requirements of subparagraph (1):
(a) The association may satisfy its minimum capital and surplus requirements through the capital and surplus equivalents, net of liabilities, of the association and its members, which must include a joint central fund that may be applied to any unsatisfied obligation of the association or any of its members, in an amount determined by the superintendent to provide adequate protection;
(b) The incorporated members of the association may not be engaged in any business other than underwriting as a member of the association and must be subject to the same level of regulation and solvency control by the association's domiciliary regulator as are the unincorporated members; and
(c) Within 90 days after its financial statements are due to be filed with the association's domiciliary regulator, the association shall provide to the superintendent an annual certification by the association's domiciliary regulator of the solvency of each underwriter member of the association or, if a certification is unavailable, financial statements, prepared by independent public accountants, of each underwriter member of the association.
(3) The superintendent shall create and publish a list of qualified jurisdictions that are eligible to serve as the domiciliary regulators of certified reinsurers.
(a) In order to determine whether the domiciliary jurisdiction of an alien assuming insurer is eligible to be recognized as a qualified jurisdiction, the superintendent shall evaluate the appropriateness and effectiveness of the reinsurance supervisory system of the jurisdiction, both initially and on an ongoing basis, and consider the rights, benefits and the extent of reciprocal recognition afforded by the jurisdiction to reinsurers licensed and domiciled in the United States. To be recognized as qualified, a jurisdiction must agree to share information and cooperate with the superintendent with respect to all certified reinsurers domiciled within that jurisdiction. A jurisdiction may not be recognized as a qualified jurisdiction if the superintendent has determined that the jurisdiction does not adequately and promptly enforce final United States judgments and arbitration awards. The superintendent may consider additional factors.
(b) If the National Association of Insurance Commissioners has published a list of recommended qualified jurisdictions, the superintendent shall consider that list in determining qualified jurisdictions. If the superintendent recognizes a jurisdiction as qualified that does not appear on the list published by the National Association of Insurance Commissioners, the superintendent shall make detailed findings of fact supporting the recognition in accordance with criteria to be developed in rules adopted under subsection 7.
(c) United States jurisdictions that are accredited by the National Association of Insurance Commissioners must be recognized as qualified jurisdictions.
(d) If a certified reinsurer's domiciliary jurisdiction ceases to be a qualified jurisdiction, the superintendent may suspend the reinsurer's certification indefinitely, in lieu of revocation.
(4) The superintendent shall assign a rating to each certified reinsurer, giving due consideration to the financial strength ratings that have been assigned by rating agencies determined to be acceptable pursuant to rules adopted under subsection 7. The superintendent shall publish a list of all certified reinsurers and their ratings.
(5) A certified reinsurer shall secure all obligations assumed from United States ceding insurers under this subsection, and under comparable laws of other states, at a level consistent with its rating and in a form acceptable to the superintendent, in compliance with rules adopted under subsection 7.
(a) If the security is insufficient, the superintendent shall reduce the allowable credit by an amount proportionate to the deficiency and may impose further reductions in allowable credit upon finding that there is a material risk that the certified reinsurer's obligations will not be paid in full when due.
(b) The reinsurer may secure its obligations as a certified reinsurer through a multibeneficiary trust that meets the requirements of paragraph C and subsection 2-A, with the following modifications.
(i) The maximum credit allowable may exceed the value of the qualifying security to the extent provided in this subparagraph.
(ii) The minimum trusteed surplus is $10,000,000, rather than the amount specified in paragraph C.
(iii) If the certified reinsurer also maintains a multibeneficiary trust for obligations required to be fully secured under paragraph C or comparable laws of other states, the certified reinsurer shall maintain separate trust accounts for its obligations incurred under reinsurance agreements issued or renewed as a certified reinsurer with reduced security and for its obligations that are required to be fully secured. The trust accounts may not be approved as qualifying security unless the reinsurer has bound itself, by the language of the trust and by agreement with the insurance regulator with principal oversight of each such trust account, to apply, upon termination of any such trust account, the remaining surplus of that trust to the extent necessary to fund any deficiency of any other such trust account.
(c) If a certified reinsurer does not secure its obligations through a qualifying multibeneficiary trust, it must secure its obligations to the ceding insurer consistent with the requirements of subsection 3, except that the maximum credit allowable may exceed the value of the qualifying security to the extent provided in this subparagraph.
(d) For purposes of this subparagraph, a certified reinsurer whose certification has been terminated for any reason must be treated as a certified reinsurer required to secure 100% of its obligations, unless the superintendent has continued to assign a higher rating, as permitted by other provisions of this section, to a certified reinsurer in inactive status or to a reinsurer whose certification has been suspended.
(6) If an applicant for certification has been certified as a reinsurer in a jurisdiction accredited by the National Association of Insurance Commissioners, the superintendent may defer to that jurisdiction's certification to grant certification in this State and may defer to the rating assigned by that jurisdiction.
(7) A certified reinsurer that ceases to assume new business in this State may request to maintain its certification in inactive status in order to continue to qualify for a reduction in security for its in-force business. An inactive certified reinsurer shall continue to comply with all applicable requirements of this subsection, and the superintendent shall assign a rating that takes into account, if relevant, the reasons why the reinsurer is not assuming new business.
Sec. B-5. 24-A MRSA §731-B, sub-§1, ¶C, as amended by PL 2001, c. 47, §3, is further amended to read:
(1) The assuming insurer shall report annually to the superintendent information substantially the same as that required to be reported on the National Association of Insurance Commissioners Annual Statement form by licensed insurers to enable the superintendent to determine the sufficiency of the trust fund.
(2) In the case of a single assuming insurer, the trust must consist of a trusteed account representing the assuming insurer's liabilities attributable to reinsurance ceded by United States ceding insurers and, in addition, unless the assuming insurer has permanently discontinued underwriting new business secured by the trust for at least 3 full years, must include a trusteed surplus of at least $20,000,000. The trust must provide that after the assuming insurer has permanently discontinued underwriting new business secured by the trust for at least 3 full years, the insurance regulator with principal oversight of the trust may authorize a reduction in the required trusteed surplus, but only after a finding, based on an assessment of the risk, that the new required surplus level is adequate for the protection of United States ceding insurers, policyholders and claimants in light of reasonably foreseeable adverse loss development. The risk assessment may involve an actuarial review, including an independent analysis of reserves and cash flows, and must consider all material risk factors, including when applicable the lines of business involved, the stability of the incurred loss estimates and the effect of the surplus requirements on the assuming insurer's liquidity or solvency. The minimum required trusteed surplus may not be reduced to an amount less than 30% of the assuming insurer's liabilities attributable to reinsurance ceded by United States ceding insurers covered by the trust.
(3-A) A group including incorporated and individual unincorporated underwriters may secure its obligations with funds held in trust in compliance with the following standards.
(a) For reinsurance ceded under reinsurance agreements with an inception, amendment or renewal date on or after August 1, 1995 January 1, 1993, the trust must consist of a trusteed account in an amount at least equal to the group's respective underwriters' several liabilities attributable to reinsurance ceded by United States domiciled ceding insurers to any member underwriter of the group.
(b) Notwithstanding the other provisions of this section, for reinsurance ceded under reinsurance agreements with an inception date on or before July 31, 1995 December 31, 1992 and not amended or renewed after that date, the trust must consist of a trusteed account in an amount not less than the group's respective underwriters' several insurance and reinsurance liabilities attributable to business written in the United States.
(c) In addition, the group shall maintain a trusteed surplus of at least $100,000,000 held jointly for the benefit of the United States domiciled ceding insurers of any member of the group for all years of account.
An incorporated member of the group may not be engaged in any business other than underwriting as a member of the group and is subject to the same level of solvency regulation and control by the group's domiciliary regulator as are the unincorporated members. Within 90 days after its financial statements are due to be filed with the group's domiciliary regulator, the group shall provide to the superintendent an annual certification by the group's domiciliary regulator of the solvency of each underwriter member of the group or, if a certification is unavailable, financial statements prepared by independent public accountants.
(4-A) The superintendent in rules adopted pursuant to subsection 7 may establish alternative criteria for approval of a reinsurance trust if the superintendent determines that the criteria provide adequate protection to policyholders of United States ceding insurers and are in substantial conformance with standards approved by the National Association of Insurance Commissioners.
(5) The trust must be established in a form approved by the superintendent and consistent with any rules adopted by the superintendent pursuant to this section. The form of the trust and any amendments to the trust must also have been approved by the insurance regulatory official of the state where the trust is domiciled or of another state that, pursuant to the terms of the trust instrument, has accepted principal regulatory oversight of the trust. The trust instrument must provide that contested claims are valid and enforceable upon the final order of any court of competent jurisdiction in the United States. The trust must vest legal title to its assets in the trustees of the trust for the benefit of the assuming insurer's United States ceding insurers, their assigns and successors in interest. The trust and the assuming insurer are subject to examination, as determined by the superintendent, at the assuming insurer's expense. The trust must remain in effect for as long as the assuming insurer has outstanding obligations due under the reinsurance agreements subject to the trust.
(6) The trustees of the trust shall report to the superintendent in writing by February 28th of each year, setting forth the balance of the trust and listing the trust's investments at the end of the preceding year and certifying the date of termination of the trust, if so planned, or certifying that the trust does not expire before December 31st of the current year.
(7) The corpus of the trust is to be valued as any other admitted asset or assets;
Sec. B-6. 24-A MRSA §731-B, sub-§1, ¶D, as amended by PL 2001, c. 47, §4, is further amended to read:
Sec. B-7. 24-A MRSA §731-B, sub-§1-A is enacted to read:
(1) The reinsurer waives its right to a hearing;
(2) The superintendent's order is based on regulatory action by the reinsurer's domiciliary jurisdiction or the voluntary surrender or termination of the reinsurer's eligibility to transact insurance or reinsurance business in its domiciliary jurisdiction or in the primary certifying state of the reinsurer under subsection 1, paragraph B-2, subparagraph (6); or
(3) The superintendent finds that an emergency requires immediate action and a court of competent jurisdiction has not stayed the superintendent's action.
Sec. B-8. 24-A MRSA §731-B, sub-§3, ¶B, as enacted by PL 1989, c. 846, Pt. E, §2 and affected by §4, is amended to read:
Sec. B-9. 24-A MRSA §731-D, as enacted by PL 1989, c. 846, Pt. E, §2 and affected by §4, is amended to read:
§ 731-D. Notification of reinsurance changes
Upon request of the The superintendent , an may by rule or order require an insurer shall to promptly inform the superintendent in writing of the cancellation or any other material change of any of the insurer's reinsurance treaties or arrangements. Rules adopted pursuant to this section are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A.
Sec. B-10. 24-A MRSA §731-E is enacted to read:
§ 731-E. Reinsurance concentration risk
PART C
Sec. C-1. 24-A MRSA §951, as amended by PL 1983, c. 346, §1, is repealed and the following enacted in its place:
§ 951. Short title
This subchapter may be known and cited as "the Standard Valuation Law."
Sec. C-2. 24-A MRSA §951-A is enacted to read:
§ 951-A. Definitions
As used in this subchapter, unless the context otherwise indicates, the following terms have the following meanings.
Sec. C-3. 24-A MRSA §952, sub-§1, as amended by PL 1973, c. 585, §12, is further amended to read:
Sec. C-4. 24-A MRSA §952, sub-§3 is enacted to read:
Sec. C-5. 24-A MRSA §952-A, as amended by PL 2011, c. 320, Pt. A, §6, is further amended to read:
§ 952-A. Actuarial opinion of reserves
The superintendent may provide by rule for a transition period for establishing any higher reserves that the qualified actuary may consider necessary in the opinion required by this subsection.
Sec. C-6. 24-A MRSA §952-B is enacted to read:
§ 952-B. Applicability of reserving methodologies
Sections 953 to 958-A do not apply to a policy or contract that is issued on or after the operative date of the valuation manual and is subject to section 959, unless those sections are made applicable by reference in whole or part in the valuation manual.
Sec. C-7. 24-A MRSA §955, sub-§2, as enacted by PL 1993, c. 634, Pt. B, §2, is amended to read:
Sec. C-8. 24-A MRSA §956, sub-§2, as enacted by PL 1993, c. 634, Pt. B, §3, is amended to read:
Sec. C-9. 24-A MRSA §§959 to 962 are enacted to read:
§ 959. Reserves subject to valuation manual
(1) The commissioners reserve valuation method for life insurance contracts, other than annuity contracts;
(2) The commissioners annuity reserve valuation method for annuity contracts; and
(3) Minimum reserves for all other policies or contracts;
(1) Requirements for the format of reports to the superintendent under section 960, subsection 3, paragraph C, which must include information necessary to determine whether the valuation is appropriate and in compliance with this subchapter;
(2) Assumptions to be prescribed for risks over which the insurer does not have significant control or influence; and
(3) Procedures for corporate governance and oversight of the actuarial function and a process for appropriate waiver or modification of such procedures;
(1) Is consistent with the minimum standard of valuation for policies and contracts issued before the operative date of the valuation manual; or
(2) Develops reserves that quantify the benefits and guarantees, and the funding, associated with the policies and contracts and their risks at a level of conservatism that reflects conditions that include unfavorable events that have a reasonable probability of occurring;
§ 960. Requirements for principle-based reserves
(1) The assumption is prescribed in the valuation manual; or
(2) For assumptions that are not prescribed in the valuation manual, the assumptions are:
(a) Established using the insurer's available experience, to the extent that it is relevant and statistically credible; or
(b) To the extent that insurer-specific data is not available, relevant or statistically credible, established using other relevant, statistically credible experience; and
§ 961. Experience reporting
For all policies and contracts in force on or after the operative date of the valuation manual, an insurer shall submit mortality, morbidity, policyholder behavior and expense experience data, as applicable, and other data as prescribed in the valuation manual.
§ 962. Confidentiality
(1) The information may be subject to subpoena for the purpose of defending an action seeking damages from the appointed actuary submitting the actuarial memorandum or principle-based valuation report;
(2) The information may be released with the written consent of the insurer; and
(3) If any portion of an actuarial memorandum or principle-based valuation report is cited by the insurer in its marketing or is publicly volunteered by the insurer before a governmental agency other than a state insurance agency or is released by the insurer to the news media, all portions of the memorandum or report become public records.
Sec. C-10. 24-A MRSA §992, sub-§1, as enacted by PL 2007, c. 281, §2 and affected by §3, is repealed and the following enacted in its place:
Sec. C-11. 24-A MRSA §2532-A, sub-§8, ¶¶F and G, as enacted by PL 1983, c. 346, §13, are amended to read:
Sec. C-12. 24-A MRSA §2532-A, sub-§8, ¶H is enacted to read:
Sec. C-13. 24-A MRSA §2532-A, sub-§9, as enacted by PL 1983, c. 346, §13, is amended to read:
PART D
Sec. D-1. 24-A MRSA §6451, sub-§6, as amended by PL 1997, c. 81, §3, is repealed and the following enacted in its place:
Sec. D-2. 24-A MRSA §6453, sub-§1, ¶A, as amended by PL 2009, c. 511, Pt. E, §2, is further amended to read:
(1) The insurer's total adjusted capital is greater than or equal to its regulatory action level risk-based capital but less than its company action level risk-based capital; or
(2) The insurer has total adjusted capital that is greater than or equal to its company action level risk-based capital but has a negative trend, if its total adjusted capital is less than the product of its authorized control level risk-based capital and : 3.0.
(a) If the insurer is a life or health insurer, 2.5; or
(b) If the insurer is a health organization as described in section 6451-A, subsection 2, 3.0;
PART E
Sec. E-1. 24-A MRSA §421, sub-§7, as enacted by PL 1999, c. 113, §18, is amended to read:
Sec. E-2. 24-A MRSA §4435, sub-§6, as amended by PL 1989, c. 67, §2, is further amended to read:
Sec. E-3. 24-A MRSA §6095, sub-§1, ¶C, as amended by PL 1997, c. 592, §73, is further amended to read:
Sec. E-4. 24-A MRSA §6098, sub-§2, as amended by PL 1997, c. 592, §74, is further amended to read:
(1) Was domiciled before April 2, 1986; and
(2) Is domiciled on and after October 27, 1986;
(1) Before October 27, 1986, purchased insurance from an insurance carrier licensed in any state; and
(2) Since October 27, 1986, purchased its insurance from an insurance carrier licensed in any state;
Sec. E-5. 24-A MRSA §6718, as amended by PL 2011, c. 90, Pt. I, §7, is repealed and the following enacted in its place:
§ 6718. Rules
SUMMARY
This bill amends several provisions of the Maine Insurance Code to incorporate recent amendments to model laws adopted by the National Association of Insurance Commissioners, or NAIC, and to make related technical changes. These amendments maintain the State's compliance with uniform financial solvency standards and with the NAIC's accreditation requirements for state insurance regulators.
Part A amends the insurance holding company laws to conform them to the current version of the relevant NAIC Model Act. It reorganizes provisions governing examinations, confidentiality and proposed change-of-control transactions, incorporating additional disclosure requirements and specific provisions on divestitures of controlling interests. It establishes new reporting requirements, including an enterprise risk report requirement and an own risk and solvency assessment requirement, and amends the review process with respect to disclaimers of affiliation and makes the process applicable to proposed acquisitions of presumptive control. It allows the Superintendent of Insurance to participate in consolidated approval proceedings for multistate transactions and in supervisory colleges, which are temporary or permanent forums for communication and cooperation among the regulators supervising an international insurance holding company system.
Part B amends the reinsurance laws to conform them to the current version of the NAIC's Credit for Reinsurance Model Act. It makes financially strong reinsurers domiciled in qualifying jurisdictions outside the United States eligible to apply for approval as certified reinsurers, with lower collateral requirements commensurate with their financial strength and domiciliary oversight.
Part C amends Maine's Standard Valuation Law to conform it to the current version of the relevant NAIC Model Act, incorporating the new principle-based reserving requirements that will become effective when adopted by a supermajority of states.
Part D amends the risk-based capital laws to strengthen the NAIC trend test and to make it applicable to companies transacting all types of insurance.
Part E gives the superintendent rule-making authority to establish financial standards and corporate governance standards for captive insurance companies that are risk retention groups, to maintain compliance with NAIC accreditation requirements. It also makes various technical corrections to the laws governing risk retention groups for internal consistency and consistency with federal law.