Current through all regulations passed and filed through September 16, 2024
(A)
Purpose
The purpose of this rule is to
establish the information required by the superintendent in setting an
acceptable total capital and surplus requirement for insurers that cede risks
and obligations to a special purpose financial captive insurance company
pursuant to division (E)(6) of section
3964.03 of the Revised Code and
for special purpose financial captive insurance companies pursuant to division
(G)(2) of section 3964.07 of the Revised
Code.
(B)
Authority
This rule is promulgated pursuant to
the authority vested in the superintendent under sections
3901.041 and
3964.21 of the Revised
Code.
(C)
Definitions
(1)
"Insurer" means a domestic legal reserve life
insurance company organized pursuant to Chapter 3907. of the Revised
Code.
(2)
"Qualified Actuary" means an individual who is both of
the following:
(a)
A member of the American academy of actuaries;
and
(b)
Qualified to provide such certifications as described
in the United States qualifications standards promulgated by the American
academy of actuaries pursuant to the code of professional conduct adopted by
the American academy of actuaries, the society of actuaries, the American
society of pension professionals and actuaries, the casualty actuarial society
and the conference of consulting actuaries.
(3)
"Special Purpose
Financial Captive Insurance Company" means a captive insurance company
organized pursuant to sections
3964.19 to
3964.194 of the Revised
Code.
(D)
Methodology
(1)
In determining
the capital and surplus requirement for an insurer that will cede risks and
obligations to a special purpose financial captive insurance company, and the
capital and surplus of a special purpose financial captive insurance company,
the superintendent is by statute required to employ a methodology that:
(a)
Is consistent
with current risk-based capital principles; and
(b)
Takes into
account all material risks and obligations, as well as the assets of the
insurer or special purpose financial captive insurance company, as
appropriate.
(2)
Pursuant to division (E)(6) of section
3964.03 of the Revised Code an
insurer that cedes risks and obligations to a special purpose financial captive
insurance company shall provide the superintendent a proposed capital and
surplus requirement that is supported by:
(a)
An actuarial
report prepared by a qualified actuary. The qualified actuary shall perform a
risk evaluation for purposes of enterprise risk management and provide the
superintendent an actuarial report documenting that evaluation. The risk
evaluation shall conform to all applicable actuarial standards of practice
including those specifically addressing risk evaluation and risk treatment in
enterprise risk management; and
(b)
Any other
information the superintendent deems necessary.
(3)
Pursuant to
division (G) of section
3964.07 of the Revised Code an
applicant for authority to be licensed as a special purpose financial captive
insurance company shall provide the superintendent a proposed capital and
surplus requirement that is supported by:
(a)
An actuarial
report prepared by a qualified actuary. The qualified actuary shall perform a
risk evaluation for purposes of enterprise risk management of the risks and
obligations specific to the special purpose financial captive insurance company
and provide the superintendent an actuarial report documenting that evaluation.
The risk evaluation shall conform to all applicable actuarial standards of
practice including those specifically addressing risk evaluation and risk
treatment in enterprise risk management; and
(b)
Any other
information the superintendent deems necessary.
(E)
Severability
If any paragraph, term or provision of
this rule is adjudged invalid for any reason, the judgment shall not affect,
impair or invalidate any other paragraph, term or provision of this rule, but
the remaining paragraphs, terms and provisions shall be and continue in full
force and effect.
Effective: 6/11/2015
Five Year
Review (FYR) Dates: 08/31/2019
Promulgated Under: 119.03
Statutory Authority: 3901.041,
3964.21
Rule Amplifies: 3964.03,
3964.07
