Approval Procedures, Credit for Reinsurance from Certified Reinsurers, Credit for Reinsurance from Reinsurers Domiciled in Reciprocal Jurisdictions, Term and Universal Life Insurance Reserve Financing
DEPARTMENT OF FINANCIAL SERVICES
RULE NOS.:RULE TITLES:
69O-144.002:Approval Procedures
69O-144.007:Credit for Reinsurance from Certified Reinsurers
69O-144.011:Credit for Reinsurance from Reinsurers Domiciled in Reciprocal Jurisdictions
69O-144.012:Term and Universal Life Insurance Reserve Financing
NOTICE OF CHANGE
Notice is hereby given that the following changes have been made to the proposed rule in accordance with subparagraph 120.54(3)(d)1., F.S., published in Vol. 48 No. 76, April 19, 2022 issue of the Florida Administrative Register.
69O-144.002 Reinsurance Application Procedures.
(1) Filing requirements and costs.
(a) though (b) No change.
(c) Failure to pay the assessed costs under paragraph (1)(b) (b) may be grounds for revocation of the insurer’s application or accreditation, pursuant to section 624.610, F.S.
(2)(a) An assuming insurer seeking accredited reinsurer status in this state, pursuant to section 624.610(3), F.S. and rule 69O-144.005, F.A.C., shall file an application in compliance with the directions in Form OIR-C1-923, “Application for Accredited Reinsurer Status,” effective 5/22 9/21, which is hereby incorporated by reference and available at www.flrules.org/XXXXX. The forms incorporated by reference in this paragraph may be obtained from https://www.floir.com/iportal. The insurer shall further submit, or otherwise comply with, the following:
1. through 8. No change.
(b) An assuming insurer seeking to maintain its accredited reinsurer status in this state, pursuant to rule 69O-144.005(2)(c), F.A.C., shall submit the following:
1. through 3. No change.
(3)(a) An assuming insurer seeking trusteed reinsurer status in this state, pursuant to section 624.610(3)(c), F.S. and rule 69O-144.006(1)(a)1., F.A.C., shall file an application in compliance with the directions in Form OIR-C1-1466, “Application for Trusteed Reinsurer Status,” effective 5/22 9/21, which is hereby incorporated by reference and available at www.flrules.org/XXXXX. The insurer shall further submit, or otherwise comply with, the following:
1. through 3. No change.
4. Form OIR-C1-1423, incorporated by reference in subsection (2) (1);
5. No change.
6. Form OIR-C1-1524, incorporated by reference in subsection (2) (1); and
7. Form OIR-C1-2221, incorporated by reference in subsection (2). (1); and,
8. Any other information required by section 624.610(3), F.S., or rule 69O-144.006(1), F.A.C.
(b) No change.
(4)(a) An assuming insurer seeking certified reinsurer status in this state, pursuant to section 624.610(3), F.S. and rule 69O-144.007(8)(a), F.A.C., shall file an application in compliance with the directions in Form OIR-C1-996, “Application for Certified Reinsurer Status,” effective 5/22 9/21, which is hereby incorporated by reference and available at www.flrules.org/XXXXX. The insurer shall further submit, or otherwise comply with, the following:
1. through 8. No change.
9. Form OIR-C1-1524, incorporated by reference in subsection (2) (1); and
10. Form OIR-C1-2221, incorporated by reference in subsection (2). (1) ; and,
11. Any other information that the Office reasonably requires to evaluate the application, including any information required by rule 69O-144.007(8)(a), F.A.C.
(b) An assuming insurer seeking to maintain its certified reinsurer status in this state, pursuant to section 624.610(3), F.S., and rule 69O-144.007(8)(h), F.A.C., shall annually submit the following, no later than
July 1:
1. Form OIR-C1-2117, “NAIC Form CR-F” (for property/casualty), or Form OIR-C1-2118, “NAIC Form CR-S” (for life and health), both of which are incorporated in paragraph (4)(a) (3)(a) of this rule;
2. through 9. No change.
(c) No change.
(5)(a) An assuming insurer seeking reciprocal jurisdiction reinsurer status in this state, pursuant to section 624.610(4), F.S., and rule 69O-144.011(3)(e), F.A.C., shall, on behalf of itself and any legal predecessors, file an application in compliance with the directions in Form OIR-C1-518, “Application for Reciprocal Jurisdiction Reinsurer Status,” effective 5/22 9/21, which is hereby incorporated by reference and available at www.flrules.org/XXXXX. The insurer shall further submit, or otherwise comply with, the following:
1. through 6. No change.
7. Form OIR-C1-1524, incorporated by reference in subsection (2) (1);
8. Form OIR-C1-2221, incorporated by reference in subsection (2) (1); and,
9. Any other information required or requested by the Office, pursuant to section 624.610(4), F.S., or rule 69O-144.011(3), F.A.C., provided that such requirements are not in conflict with an applicable covered agreement.
(b) An assuming insurer seeking to maintain its reciprocal jurisdiction reinsurer status in this state, pursuant to section 624.610(4), F.S., and rule 69O-144.011(3)(g), F.A.C., shall annually submit the following, no later than each July 1:
1. through 5. No change.
6. Any other information required or requested by the Office, pursuant to section 624.610(4), F.S., or rule 69O-144.011(3)(g), F.A.C., provided that such requirements are not in conflict with an applicable covered agreement.
(c) No change.
(d) This subsection does not limit the authority of the Office to request additional information pertaining to the reinsurance agreement, or any subsequent reinsurance agreement entered into by the assuming insurer and Florida ceding insurers, under section 624.610(4)(e), F.S., provided that such requirements are not in conflict with an applicable covered agreement.
(6) An assuming insurer meeting any other eligibility criteria under the rules of this chapter or under section 624.610, F.S., shall make the necessary and applicable filings with the Office.
Rulemaking Authority 624.308, 624.610(15) FS. Law Implemented 624.307(1), (2), (3), (5), 624.316, 624.317, 624.318, 624.321, 624.324, 624.34, 624.401, 624.404, 624.407, 624.413, 624.424, 624.501(20), 624.5091, 624.610, 628.051, 628.061, 628.801, 629.081 FS. History–New 1-30-91, Formerly 4-108.002, Amended 5-12-94, 10-13-02, Formerly 4-144-002, Amended 9-14-06, __________.
69O-144.007 Credit for Reinsurance from Certified Reinsurers.
(1) through (4) No change.
(5) Nothing in this rule shall be construed to deny the ceding insurer the ability to take credit for reinsurance for the remainder of its liabilities with a certified reinsurer so long as those amounts are secured with acceptable collateral pursuant to section 624.610(5), F.S., and subsection subsections 69O-144.005(5) and (6), F.A.C.
(6) through (7)
(8) Status as certified reinsurer:
(a) through (d) No change.
(e) Each certified reinsurer shall be rated on a legal entity basis, with due consideration being given to the group rating where appropriate, except that an association including incorporated and individual unincorporated underwriters that has been approved to do business as a single certified reinsurer may be evaluated on the basis of its group rating. Factors that may be considered as part of the evaluation process include, but are not limited to, the following:
1. through 7. No change.
(f) through (g) No change.
(h) An assuming insurer seeking to maintain its certified reinsurer status in this state shall annually file the following information required by rule 69O-144.002(4)(b), F.A.C. If an NAIC accredited jurisdiction has determined that a certified reinsurer has met the conditions in that jurisdiction to become a certified reinsurer, the Office may accept documentation filed with that NAIC accredited jurisdiction or with the NAIC to satisfy the certified reinsurer’s status in this state.
(i) through (k) No change.
(9) through (16) No change.
Rulemaking Authority 624.308, 624.610(4), (15) (14) FS. Law Implemented 624.307(1), 624.424, 624.610 FS. History–New 10-29-08, Amended 7-28-15, 7-30-17, __________.
69O-144.011 Credit for Reinsurance from Reinsurers Domiciled in Reciprocal Jurisdictions.
(1) through (2) No change.
(3) Credit shall be allowed when the reinsurance is ceded from an insurer domiciled in this state to an assuming insurer meeting each of the conditions set forth below.
(a) through (c) No change.
1. through 6. No change.
(e) through (f) No change.
(g) To maintain its reciprocal jurisdiction reinsurer status in this state, the assuming insurer or its legal successor must annually provide the information required by rule 69O-144.002(5)(b), F.A.C. If an NAIC accredited jurisdiction has determined that a reciprocal jurisdiction certified reinsurer has met the conditions in that jurisdiction to become a reciprocal jurisdiction certified reinsurer, the Office may accept documentation filed with that NAIC accredited jurisdiction or with the NAIC to satisfy the certified reinsurer’s status in this state.
(h) through (i) No change.
(4) The Office shall publish and maintain a list of approved reciprocal jurisdictions on its website. The Office shall timely create and publish a list of Reciprocal Jurisdictions.
(a) A list of Reciprocal Jurisdictions is published through the NAIC Committee Process. The Office’s list shall include any Reciprocal Jurisdiction as defined under paragraphs (2)(a) and (2)(b) and shall consider any other Reciprocal Jurisdiction included on the NAIC list. The Office may approve a jurisdiction that does not appear on the NAIC list of Reciprocal Jurisdictions as provided by applicable law, regulation, or in accordance with criteria published through the NAIC Committee Process.
(b) The Office may remove a jurisdiction from the list of Reciprocal Jurisdictions upon a determination that the jurisdiction no longer meets one or more of the requirements of a Reciprocal Jurisdiction, as provided by applicable law, regulation, or in accordance with a process published through the NAIC Committee Process, except that the Office shall not remove from the list a Reciprocal Jurisdiction as defined under paragraphs (2)(a) and (2)(b). Upon removal of a Reciprocal Jurisdiction from this list credit for reinsurance ceded to an assuming insurer domiciled in that jurisdiction shall be allowed, if otherwise allowed pursuant to this rule and section 624.610(4), F.S.
(5) The Office shall publish and maintain a list of reciprocal jurisdiction reinsurers on its website. The Office shall timely create and publish a list of assuming insurers that have satisfied the conditions set forth in this section and to which cessions shall be granted credit in accordance with this section.
(a) If an NAIC accredited jurisdiction has determined that the conditions set forth in subsection (3) have been met, the Office has the discretion to defer to that jurisdiction’s determination, and add such assuming insurer to the list of assuming insurers to which cessions shall be granted credit in accordance with this subsection. The Office may accept financial documentation filed with another NAIC accredited jurisdiction or with the NAIC in satisfaction of the requirements of subsection (3).
(b) When requesting that the Office defer to another NAIC accredited jurisdiction’s determination, an assuming insurer must submit a properly executed Form OIR-C1-517, “Certificate of Reinsurer Domiciled in Reciprocal Jurisdiction,” incorporated by reference in paragraph (3)(d),and additional information as the Office may require. A state that has received such a request will notify other states through the NAIC Committee Process and provide relevant information with respect to the determination of eligibility.
(6) through (9) No change.
Rulemaking Authority 624.308(1); 624.610(15). Law Implemented 624.610(4), (15) FS. History-New _____.
69O-144.012 Term and Universal Life Insurance Reserve Financing.
(1) The purpose and intent of this rule is to implement the establish uniform, national standards governing reserve financing arrangements pertaining to life insurance policies containing guaranteed nonlevel gross premiums, guaranteed nonlevel benefits and universal life insurance policies with secondary guarantees; and to ensure that, with respect to each such financing arrangement, funds consisting of primary security and other security, as defined in subsection (3) of this rule, are held by or on behalf of ceding insurers in the forms and amounts required herein. In general, reinsurance ceded for reserve financing purposes has one or more of the following characteristics: some or all of the assets used to secure the reinsurance treaty or to capitalize the reinsurer:
(a) through (c) No change.
(2) No change.
(3) Definitions
(a) through (h) No change.
(i) “Valuation Manual” means the valuation manual adopted by the NAIC as defined in section 625.1212(2)(k) 625.1212(1)(k), F.S., with all amendments adopted by the NAIC that are effective for the financial statement date on which credit for reinsurance is claimed.
(j) “VM-20” means “Requirements for Principle-Based Reserves for Life Products,” including all relevant definitions, from the Valuation Manual defined in section 625.1212(2)(k), F.S., 625.1212(1k).
(4) This rule does not apply to the following situations:
(a) thorough (e) No change.
(f) If a person submits a petition under section 120.542, F.S., to the office, reinsurance Reinsurance not otherwise exempt under paragraphs (a) through (e) if the office, after consulting with the NAIC Financial Analysis Working Group (FAWG) or other group of regulators designated by the NAIC, as applicable, determines under all the facts and circumstances that all of the following apply:
1. through 3. No change.
(5) through (7) No change.
Rulemaking Authority 624.308(1), 624.610(15), 625.121(3), 625.1212(5), (8). Law Implemented 624.4085, 624.610, 625.012, 625.121, 625.1212, 625.151 FS. History-New _____.
