Current through Register Vol. 49, No. 6, March 15, 2024
PURPOSE: The purpose of this rule is to prescribe
procedures to be followed in applications for a certificate of authority to
form and operate a Missouri domestic surplus lines insurer. This rule also
effectuates and aids in the interpretation of section
384.018,
RSMo.
(1) The procedures
outlined in this section are the procedures required for the successful
formation of a Missouri domestic surplus lines insurer authorized to write any
kind of insurance that a nonadmitted insurer not domiciled in Missouri is
eligible to write.
(A) The insurer must be
admitted and domiciled in Missouri. Any foreign insurance company or
incorporators wishing to become or form a Missouri domestic surplus lines
insurer must satisfy this requirement in one (1) of the two (2) following
manners:
1. Any foreign insurance company
wishing to become a Missouri domestic surplus lines insurer must first
redomesticate to Missouri pursuant to the procedures outlined in section
375.908,
RSMo, and
20 CSR
200-17.300; or
2. Any incorporators wishing to form a
Missouri domestic surplus lines insurer must first form a Missouri domestic
insurance company pursuant to the procedures outlined in sections
379.010-379.065, RSMo (insurance companies other than life), and
20
CSR 200-17.100.
(B) The insurer must furnish to the director
proof that the insurer possesses policyholder surplus of at least twenty
million dollars ($20,000,000).
(C)
The insurer must furnish to the director proof that the insurer is an approved
or eligible surplus lines insurer in at least one (1) jurisdiction other than
Missouri.
(D) The board of
directors of the insurer must pass a resolution seeking to be a domestic
surplus lines insurer in Missouri.
(E) The insurer must provide a copy of its
current articles of incorporation. The director may waive this requirement at
his/her discretion if such articles of incorporation are already on file with
the department and no amendments have been made.
(F) The insurer must provide a copy of its
current bylaws. The director may waive this requirement at his/her discretion
if such bylaws are already on file with the department and no amendments have
been made.
(G) The insurer must pay
any required filing fees pursuant to section
374.230,
RSMo.
(H) The insurer must submit
all biographical affidavits for all officers, directors, and other key
personnel of the company. The director may waive this requirement in whole or
part at his/her discretion if such biographical affidavits are already on file
with the department and no changes have been made to the officers, directors,
and other key personnel of the company.
(I) The insurer must submit any other
information requested by the director relevant to the issuance of a certificate
of authority as a domestic surplus lines insurer.
(J) The insurer must surrender to the
director its certificate of authority to transact admitted insurance business
in the state of Missouri.
(K) Upon
satisfaction that the requirements outlined in subsections (1)(A)-(J) of this
section have been met, the director will accept the surrender outlined in
subsection (1)(J) of this section and concurrently issue the company a
certificate of authority, which shall constitute written approval for the
company to be a domestic surplus lines insurer pursuant to section
384.018.1(4), RSMo.
(L) For
insurers that choose to satisfy the requirements of subdivision 1 or 2 of
subsection (1)(A) simultaneously with subsections (1)(B)-(I), subsection (1)(J)
will be deemed satisfied without the issuance and subsequent surrender of a
certificate of authority to transact admitted insurance business. Insurers
already in possession of a certificate of authority to transact admitted
insurance business must satisfy subsection (1)(J) as written.
(2) All financial and solvency
requirements imposed by Chapters 374, 375, 379, and 382, RSMo, upon domestic
admitted insurers shall apply to domestic surplus lines insurers unless
domestic surplus lines insurers are otherwise specifically exempted. These
financial and solvency requirements shall include, but not be limited to:
(A) Financial examination pursuant to
sections
374.202
to
374.207,
RSMo;
(B) The deposit requirement
in section
379.098,
RSMo. For the purposes of section
379.010,
RSMo, a domestic surplus lines insurer shall be considered to be making two (2)
or more classes of insurance. The deposit required in order to satisfy
subsection (1)(A) above, may continue to be held in satisfaction of this
requirement, provided the deposit is of the amount specified in section
379.010.2, RSMo, for a company making two (2) or more classes of
insurance;
(C) Requirements imposed
by Chapter 382, RSMo, which are all deemed to be financial and solvency
requirements for the purposes of section 384.018.6, RSMo; and
(D) All other financial and solvency
requirements imposed by Chapters 374, 375, 379, and 382, RSMo, upon domestic
admitted insurers.
(3)
All requirements imposed by Chapter 384, RSMo, upon nonadmitted insurers shall
apply to domestic surplus lines insurers unless domestic surplus lines insurers
are otherwise specifically exempted.
(4) A financial or solvency requirement
imposed by Chapter 384, RSMo, upon domestic surplus lines insurers shall
supersede a requirement imposed under section 384.018.6, RSMo and section (2)
of this rule only to the extent that Chapter 384, RSMo, addresses the same
financial or solvency requirement. This supersession shall be construed
narrowly. Any ambiguity as to the supersession of a requirement imposed under
section 384.018.6, RSMo and section (2) of this rule shall be interpreted in
support of the continued application of such requirement.
(5) For the purposes of section
374.230(3),
RSMo, the certificate of authority issued
pursuant to section 384.018.1(4), RSMo and subsection (1)(K) of this rule shall
be a certificate of authority for which annual renewal is required.
(6) By way of the certificate of authority
issued to a domestic surplus lines insurer pursuant to section 384.018.1(4),
RSMo and subsection (1)(K) of this rule, a Missouri domestic surplus lines
insurer shall be authorized to write that kind of insurance in Missouri as
required by section 384.021.1(1), RSMo.
(7) Credit shall be allowed pursuant to
section 375.246.1(1), RSMo for reinsurance ceded to a Missouri domestic surplus
lines insurer.