Current through Register Vol. 56, No. 18, September 16, 2024
(a) Nonrenewals,
cancellations or revisions of ceded reinsurance agreements are not required to
be reported, as otherwise required pursuant to
11:1-39.3, if the nonrenewals,
cancellations or revisions are not material.
1. For purposes of this subchapter, a
material nonrenewal, cancellation or revision is one that affects:
i. As respects property and casualty
business, including accident and health business written by a property and
casualty insurer:
(1) More than 50 percent of
the insurer's total ceded written premiums; or
(2) More than 50 percent of the insurer's
total ceded indemnity and loss adjustment reserves;
ii. As respects life, annuity and accident
and health business, more than 50 percent of the total reserve credit taken for
business ceded, on an annualized basis, as indicated in the insurer's most
recent annual statement; and
iii.
As respects both property and casualty, and life, annuity, and accident and
health business, either of the following events:
(1) An authorized reinsurer representing more
than 10 percent of a total cession is replaced by one or more unauthorized
reinsurers; or
(2) Previously
established collateral requirements have been reduced or waived as respects one
or more unauthorized reinsurers representing collectively more than 10 percent
of a total cession.
(b) No filing pursuant to (a) above shall be
required if:
1. As respects property and
casualty business, including accident and health business written by a property
and casualty insurer, the insurer's total ceded written premium represents, on
an annualized basis, less than 10 percent of its total written premium for
direct and assumed business; or
2.
As respects life, annuity, and accident and health business, the total reserve
credit taken for business ceded represents, on an annualized basis, less than
10 percent of the statutory reserve requirement prior to any cession.
(c) The following shall be
disclosed and provided in any report of a material nonrenewal, cancellation or
revision of ceded reinsurance agreements required to be filed pursuant to this
subchapter:
1. The effective date of the
nonrenewal, cancellation or revision;
2. A description of the transaction with an
identification of the initiator thereof;
3. The purpose of, or reason for, the
transactions;
4. If applicable, the
identity of the replacement reinsurers; and
5. A copy of the revised provisions of the
reinsurance agreement.
(d) Insurers shall report all material
nonrenewals, cancellations or revisions of ceded reinsurance agreements on a
non-consolidated basis unless the insurer is part of a consolidated group of
insurers which utilizes a pooling arrangement or 100 percent reinsurance
agreement that affects the solvency and integrity of the insurer's reserves and
the insurer ceded substantially all of its direct and assumed business to the
pool. An insurer is deemed to have ceded substantially all of its direct and
assumed business to a pool if the insurer has less than $ 1,000,000 total
direct plus assumed written premiums during a calendar year that are not
subject to a pooling arrangement and the net income of the business not subject
to the pooling arrangement represents less than five percent of the insurer's
capital and surplus.
