Code of Maine Rules
02 - DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION
031 - BUREAU OF INSURANCE
Chapter 760 - LIFE AND HEALTH REINSURANCE AGREEMENTS
Section 031-760-2 - Preamble

Universal Citation: 02 ME Code Rules ยง 031-760-2

Current through 2024-38, September 18, 2024

A. The State of Maine Bureau of Insurance recognizes that licensed insurers routinely enter into reinsurance agreements that yield legitimate relief to the ceding insurer from strain to surplus.

It is, however, improper for a licensed ceding insurer to enter into a reinsurance agreement for the principal purpose of obtaining significant surplus aid without transferring all of the significant risks inherent in the business being reinsured, as the expected potential liability of the ceding insurer under such agreement remains essentially unchanged by the reinsurance agreement, notwithstanding certain risk elements contained in the agreement, such as catastrophic mortality or extraordinary survival. If the terms of a reinsurance agreement give rise to any of the conditions enumerated in Section 4(A), the existence of such condition may constitute a violation or noncompliance with one or more of the following:

(1) 24-A M.R.S.A. §424(2);

(2) 24-A M.R.S.A. §731-B;

(3) 24-A M.R.S.A. §417(2)(a);

(4) 24-A M.R.S.A. §4356.

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