[§431:4F-105]  Requirements for trust
agreement.  (a)  The terms of the trust agreement required by section
431:4F-103 shall be set forth in a deed of trust.  The deed of trust and all
subsequent amendments shall be authenticated in a form and manner as the
commissioner may prescribe and shall not be effective unless approved by the
commissioner upon a finding that:



(1)  A deed of trust or its amendments are sufficient
in form and in conformity with law;



(2)  The trustee or trustees are eligible as such; and



(3)  The deed of trust is adequate to protect the
interests of the beneficiaries of the trust.



(b)  If at any time after reasonable notice and
hearing, the commissioner finds that the requisites for the approval no longer
exist, the commissioner may withdraw approval.



(c)  The commissioner may approve modifications
of, or variations in any deed of trust, which in the commissioner's judgment
are not prejudicial to the interests of the people of this State or
policyholders and creditors in the United States, of the United States branch.



(d)  The deed of trust shall contain provisions
that:



(1)  Vest legal title to trusteed assets in the
trustee or trustees, and their lawfully appointed successors;



(2)  Require that all assets deposited in the trust
shall be continuously kept within Hawaii;



(3)  Provide for substitution of a new trustee or
trustees in case of a vacancy by death, resignation, or otherwise, subject to
the approval of the commissioner;



(4)  Require that the trustee or trustees shall
continuously maintain a record at all times sufficient to identify the assets
of such fund;



(5)  Require that the trusteed assets shall consist of
cash or investments, or both, as permitted by article 6 for investment of the
funds of domestic insurers and accrued interest thereon if collectable by the
trustee;



(6)  Require that the trust shall be for the exclusive
benefit, security, and protection of the policyholders, or policyholders and
creditors in the United States, of the United States branch;



(7)  Require that the trust shall be maintained as
long as there is any outstanding liability of the alien insurer arising out of
its insurance transactions in the United States; and



(8)  Provide, in substance, that no withdrawals of
assets, other than income as specified in subsection (e) shall be made or
permitted by the trustee or trustees without the approval of the commissioner
except to:



(A)  Make deposits required by law in any state
for the security or benefit of all policyholders, or policyholders and
creditors in the United States, of the United States branch;



(B)  Substitute other assets permitted by law
and at least equal in value and quality to those withdrawn, upon the specific
written direction of the United States branch manager when duly empowered and acting
pursuant to either general or specific written authority previously given or
delegated by the board of directors; or



(C)  Transfer such assets to an official
liquidator or rehabilitator pursuant to an order of a court of competent
jurisdiction.



(e)  The deed of trust may provide that income,
earnings, dividends, or interest accumulations of the assets of the fund may be
paid over to the United States branch manager of the United States branch upon
request; provided that the total trusteed assets shall not be less than the
amount required to be maintained pursuant to section 431:4F-104.



(f)  Upon withdrawal of trusteed assets
deposited in another state in which the insurer is authorized to do business,
it shall be sufficient if the deed of trust requires similar written approval
of the insurance supervising official of that state in lieu of approval of the
commissioner; provided that the total trusteed assets shall not be less than
the amount required to be maintained pursuant to section 431:4F-104.  In all
such cases, the United States branch shall notify the commissioner in writing
of the nature and extent of the withdrawal.



(g)  The commissioner may:



(1)  Make examinations of the trusteed assets of any
authorized United States branch at the insurer's expense; and



(2)  Require the trustee or trustees to file a
statement, in such form as the commissioner may prescribe, certifying the
assets of the trust fund and the amounts thereof.



(h)  Refusal or neglect of any trustee to
comply with this section shall be grounds for the revocation of the insurer's
license or the liquidation of its United States branch. [L 2004, c 120, pt of
§2]