New York Codes, Rules and Regulations
Title 11 - INSURANCE
Chapter IV - Financial Condition Of Insurer and Reports to Superintendent
Subchapter A - Rules of General Application
Part 77
Section 77.2 - Exchange traded fund RBC charge

Universal Citation: 77.2 NY Comp Codes Rules and Regs ยง 77.2

Current through Register Vol. 46, No. 39, September 25, 2024

(a) Until January 1, 2027, the shares of an exchange traded fund shall be treated as bonds for the purpose of a domestic insurer's RBC report if the exchange traded fund meets the following criteria:

(1) the portfolio of the exchange traded fund consists of investments in fixed income securities, cash, and cash equivalents;

(2) the exchange traded fund tracks a bond index (i.e., is not actively managed) and makes publicly available no less frequently than monthly a detailed list of its holdings;

(3) the exchange traded fund has a minimum of US $ 1 billion in assets under management;

(4) the exchange traded fund allows in-kind redemptions;

(5) the exchange traded fund is registered pursuant to the Investment Company Act of 1940, 15 U.S.C. §§ 80a-1- 80a-64;

(6) the exchange traded fund is rated by a nationally recognized statistical rating organization.

(b) A domestic insurer shall apply the applicable RBC charge as set forth in the RBC instructions to any shares of an exchange traded fund that meets the criteria set forth in subdivision (a) of this section.

(c) Nothing in this section shall affect the classification of shares of exchange traded funds as equity for legal purposes, including for the purposes of Insurance Law article 14.

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