CHAPTER 18. DISCLOSURE OF MATERIAL TRANSACTIONS
IC 27-2-18
Chapter 18. Disclosure of Material Transactions
IC 27-2-18-1
"Asset acquisition" defined
Sec. 1. (a) As used in this chapter, "asset acquisition" includesevery purchase, lease, exchange, merger, consolidation, succession,or other acquisition.
(b) The term does not include the construction on or developmentof real property by or for the reporting insurer or the acquisition ofmaterials for construction or development.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-2
"Asset disposition" defined
Sec. 2. As used in this chapter, "asset disposition" includes everysale, lease, exchange, merger, consolidation, mortgage,hypothecation, assignment (whether for the benefit of creditors orotherwise), abandonment, destruction, or other disposition.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-3
"Domicile" defined
Sec. 3. As used in this chapter, "domicile" means the following:
(1) For a corporation, the state in which the purchasing groupis incorporated.
(2) For an unincorporated entity, the state of its principal placeof business.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-4
"Material acquisition" defined
Sec. 4. As used in this chapter, "material acquisition" means anasset acquisition or a series of related asset acquisitions during anythirty (30) day period that:
(1) is nonrecurring;
(2) is not in the normal course of business; and
(3) involves more than five percent (5%) of the reportinginsurer's total admitted assets as reported in the insurer's mostrecent statutory statement filed with the department.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-5
"Material disposition" defined
Sec. 5. As used in this chapter, "material disposition" means anasset disposition or a series of related asset dispositions during anythirty (30) day period that:
(1) is nonrecurring;
(2) is not in the normal course of business; and
(3) involves more than five percent (5%) of the reporting
insurer's total admitted assets as reported in the insurer's mostrecent statutory statement filed with the department.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-6
"Material nonrenewal, cancellation, or revision of a cededreinsurance agreement" defined; reportable material revisions
Sec. 6. (a) As used in this chapter, "material nonrenewal,cancellation, or revision of a ceded reinsurance agreement" has thefollowing meanings:
(1) When used in connection with property and casualtybusiness, including accident and sickness insurance businesswritten by a property and casualty insurer, the term means anonrenewal, cancellation, or revision that affects:
(A) more than fifty percent (50%) of the insurer's total cededwritten premium; or
(B) more than fifty percent (50%) of the insurer's total cededindemnity and loss adjustment reserves.
(2) When used in connection with life insurance or accident andsickness insurance business, the term means a nonrenewal,cancellation, or revision that affects more than fifty percent(50%) of the total reserve credit taken for business ceded on anannualized basis, as indicated in the insurer's most recent annualstatement.
(b) The following events constitute a material revision of a cededreinsurance agreement for property and casualty insurance, lifeinsurance, or accident and sickness insurance business meeting therequirements of subsection (a) and must be reported:
(1) An authorized reinsurer representing more than ten percent(10%) of a total cession is replaced by one (1) or moreunauthorized reinsurers.
(2) Previously established collateral requirements have beenreduced or waived as respects one (1) or more unauthorizedreinsurers representing collectively more than ten percent (10%)of a total cession.
(c) A nonrenewal, cancellation, or revision of a ceded reinsuranceagreement is not material and a filing is not required undersubsection (a) or (b) for the following:
(1) In connection with property and casualty business, includingaccident and sickness insurance business written by a propertyand casualty insurer, the insurer's total ceded written premiumrepresents, on an annualized basis, less than ten percent (10%)of the insurer's total written premiums for direct and assumedbusiness.
(2) In connection with life insurance or accident and sicknessinsurance business, the total reserve credit taken for businessceded represents, on an annualized basis, less than ten percent(10%) of the statutory reserve requirement before any cession.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-7
Reports
Sec. 7. (a) Except as provided in subsection (b), an insurerdomiciled in Indiana shall file a report with the commissionerdisclosing:
(1) a material acquisition;
(2) a material disposition; and
(3) a material nonrenewal, cancellation, or revision of a cededreinsurance agreement.
(b) A report of a transaction described in subsection (a) does nothave to be filed with the commissioner under this section if thetransaction was previously submitted to the commissioner for review,approval, or information purposes under other provisions of IC 27,rules adopted by the department, or other requirements.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-8
Time of filing
Sec. 8. The report required in section 7 of this chapter must befiled not later than fifteen (15) days after the end of the calendarmonth in which the transaction that requires the filing occurred.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-9
Filing copies
Sec. 9. One (1) complete copy of the report, including anyexhibits or other attachments filed with the report, shall be filed withthe:
(1) department; and
(2) National Association of Insurance Commissioners.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-10
Reports as confidential information; exceptions
Sec. 10. (a) Except as provided in subsections (b) and (c), anyreport obtained by or disclosed to the commissioner under thischapter:
(1) shall be confidential information; and
(2) shall not, without the prior written consent of the insurer towhich it pertains, be:
(A) subject to subpoena; or
(B) made public by the commissioner, the NationalAssociation of Insurance Commissioners, or any otherperson.
(b) A report obtained under this chapter may be made available toother departments of insurance in other states subject toIC 27-1-3-10.5.
(c) The commissioner may, after giving notice and an opportunityto be heard to the insurer that would be affected by the release ofinformation under this chapter: (1) determine that the interests of policyholders, shareholders,or the public will be served by the publication of information inthe report under section 7 of this chapter; and
(2) publish all or any part of the information in such manner asthe commissioner considers appropriate.
(d) The commissioner may not:
(1) disclose; or
(2) subject to subpoena;
financial information regarding material transactions disclosed by aninsurer under this chapter.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-11
Contents of reports of material acquisitions and dispositions
Sec. 11. The following information must be disclosed in anyreport of a material asset acquisition or asset disposition:
(1) The date of the transaction.
(2) The manner of the asset acquisition or asset disposition.
(3) A description of the assets involved.
(4) The nature and amount of the consideration given orreceived in connection with the asset acquisition or the assetdisposition.
(5) The purpose of or reason for the transaction.
(6) The manner by which the amount of consideration wasdetermined.
(7) The gain or loss recognized or realized as a result of thetransaction.
(8) The name of each person from whom the assets wereacquired or to whom the assets were disposed.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-12
Reports of material acquisitions and dispositions onnonconsolidated basis; exceptions
Sec. 12. (a) Insurers must report material acquisitions anddispositions on a nonconsolidated basis unless the insurer is part ofa consolidated group of insurers that uses a pooling arrangement orone hundred percent (100%) reinsurance agreement that affects thesolvency and integrity of the insurer's reserves and the insurer cededsubstantially all of its direct and assumed business to the pool.
(b) An insurer is considered to have ceded substantially all of itsdirect and assumed business to a pool under subsection (a) if theinsurer has less than one million dollars ($1,000,000) total direct plusassumed written premiums during a calendar year that are not subjectto a pooling arrangement and the net income of the business notsubject to the pooling arrangement represents less than five percent(5%) of the insurer's capital and surplus.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-13 Contents of reports of material nonrenewals, cancellations, orrevisions
Sec. 13. The following information must be disclosed on anonconsolidated basis in any report of a material nonrenewal,cancellation, or revision of a ceded reinsurance agreement:
(1) The effective date of the nonrenewal, cancellation, orrevision.
(2) The description of the transaction with an identification ofthe initiator of the transaction.
(3) The purpose of or reason for the transaction.
(4) If applicable, the identity of the replacement reinsurers.
As added by P.L.251-1995, SEC.17.
IC 27-2-18-14
Reports of material nonrenewals, cancellations, or revisions onnonconsolidated basis; exceptions
Sec. 14. (a) An insurer must report all material nonrenewals,cancellations, or revisions of ceded reinsurance agreements on anonconsolidated basis unless:
(1) the insurer is part of a consolidated group of insurers thatuses a:
(A) pooling arrangement; or
(B) one hundred percent (100%) reinsurance agreement;
that affects the solvency and integrity of the insurer's reserves;and
(2) the insurer ceded substantially all of its direct and assumedbusiness to the pool.
(b) An insurer is considered to have ceded substantially all of itsdirect and assumed business to a pool under subsection (a) if theinsurer has less than one million dollars ($1,000,000) total direct plusassumed written premiums during a calendar year that are not subjectto a pooling arrangement and the net income of the business notsubject to the pooling arrangement represents less than five percent(5%) of the insurer's capital and surplus.
As added by P.L.251-1995, SEC.17.