Connecticut Administrative Code
Title 38a - Insurance Department
138 - Insurance Holding Company Act
Section 38a-138-13 - Transactions subject to prior notice - notice filing
Universal Citation: CT Reg of State Agencies 38a-138-13
Current through March 14, 2024
(a) An insurer required to give notice of a proposed transaction pursuant to section 38a-136 of the Connecticut General Statutes shall furnish the required information on Form D (Appendix D of sections 38a-138-1 to 38a-138-16, inclusive, of the Regulations of Connecticut State Agencies).
(b) Agreements for cost sharing services and management services shall at a minimum and as applicable:
(1) Identify the person providing the service and
the nature of such services;
(2) Set
forth the methods to allocate costs;
(3)
Require timely settlement, not less frequently than on a quarterly basis, and
compliance with the requirements in the NAIC Accounting Practices and Procedures
Manual;
(4) Prohibit advancement of
funds by the insurer to the affiliate except to pay for services defined in the
agreement;
(5) State that the insurer
will maintain oversight for functions provided to the insurer by the affiliate and
that the insurer will monitor services annually for quality assurance;
(6) Define books and records of the insurer to
include all books and records developed or maintained under or related to the
agreement that are otherwise the property of the insurer, in whatever form
maintained, including, but not limited to, claims and claim files, policyholder
lists, application files, litigation files, premium records, rate books,
underwriting manuals, personnel records, financial records, or similar records
within the possession, custody, or control of the affiliate;
(7) Specify that all books and records of the
insurer are and remain the property of the insurer and:
(A) Are subject to control of the
insurer;
(B) Are identifiable;
(C) Are segregated from all other persons' books
and records or are readily capable of segregation at no additional cost to the
insurer;
(8) State that all
funds and invested assets of the insurer are the exclusive property of the insurer,
held for the benefit of the insurer and are subject to the control of the
insurer;
(9) Include standards for
termination of the agreement with and without cause;
(10) Include provisions for indemnification of the
insurer in the event of gross negligence or willful misconduct on the part of the
affiliate providing the services and for any actions by the affiliate that violate
provisions of the agreement required in subdivision (11) to (15), inclusive, of this
subsection ;
(11) Specify that, if the
insurer is placed in receivership or seized by the Commissioner under Chapter 704c
of the Connecticut General Statutes:
(A) All of the
rights of the insurer under the agreement extend to the receiver or Commissioner;
(B) All books and records of the
insurer shall be identifiable and segregated from all other persons' books and
records or readily capable of segregation at no additional cost to the receiver or
the Commissioner;
(C) A complete set of
books and records shall be made immediately available to the receiver or
Commissioner, be made available in a usable form and be turned over to the receiver
or Commissioner immediately upon the receiver's or Commissioner's request, and the
cost to transfer data to the receiver or Commissioner shall be fair and reasonable;
and
(D) The affiliate shall make
available all employees essential to the operations of the insurer and the services
associated therewith for the immediate continued performance of the essential
services ordered or directed by the receiver or Commissioner;
(12) Specify that the affiliate has no automatic
right to terminate the agreement if the insurer is placed in supervision, seizure,
conservatorship, or receivership pursuant to Chapter 704c of the Connecticut General
Statutes;
(13) Specify that the
affiliate shall continue to maintain any systems, programs or other infrastructure
notwithstanding supervision , seizure , conservatorship, or receivership by the
Commissioner under Chapter 704c of the Connecticut General Statutes, and will make
them available to the receiver or Commissioner as ordered or directed by the
receiver or Commissioner , for as long as the affiliate continues to receive timely
payment for post-receivership services rendered and unless released by the receiver,
Commissioner or supervising court;
(14)
Specify that the affiliate shall provide the essential services for a minimum period
of time as specified in the agreement after termination of the agreement, if the
insurer is placed into supervision, seizure, conservatorship, or receivership
pursuant to Chapter 704c of the Connecticut General Statutes, as ordered or directed
by the receiver or Commissioner. Performance of the essential services will continue
to be provided without regard to pre-receivership unpaid fees, so long as the
affiliate continues to receive timely payment for post-receivership services
rendered, and unless released by the receiver, Commissioner, or supervising court;
and
(15) Specify that, in furtherance of
the cooperation between the receiver and the affected guaranty association or
associations and subject to the receiver's authority over the insurer, if the
insurer is placed into supervision, seizure, conservatorship or receivership
pursuant to pursuant to Chapter 704c of the Connecticut General Statutes, and
portions of the insurer's policies or contracts are eligible for coverage by one or
more guaranty associations, the affiliate's commitments under subdivision (11) to
(15), inclusive, of this subsection shall extend to such guaranty
association(s).
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