CHAPTER 1.1. REINSURANCE
IC 27-6-1.1
Chapter 1.1. Reinsurance
IC 27-6-1.1-1
Definitions
Sec. 1. As used in this chapter:
"Accepting insurer" means the insurer that is a party to areinsurance transaction and that reinsures insurance, annuity, andendowment risks or liabilities of another insurer.
"Assumption reinsurance" means a transaction in which one (1)insurer assumes all or a portion of the insurance, annuity, andendowment risks or liabilities of another insurer and therebybecomes directly and primarily liable to the insured, beneficiary, orpolicyholder under the policies and contracts subject to thereinsurance transaction.
"Ceding insurer" means the insurer that is a party to a reinsurancetransaction and whose insurance, annuity, and endowment risks orliabilities are reinsured.
"Indemnity reinsurance" means a transaction in which one (1)insurer agrees to indemnify another insurer for all or a portion of theinsurance, annuity, and endowment risks or liabilities of the cedinginsurer.
As added by P.L.260-1983, SEC.1.
IC 27-6-1.1-2
Indemnity reinsurance; ceding agreements
Sec. 2. (a) A domestic insurer may cede indemnity reinsurance toany insurer authorized to do business in this state, in any other stateof the United States, or in the District of Columbia, or to any alieninsurer.
(b) A domestic ceding insurer must file with the commissioner forapproval any proposed agreement that would cede indemnityreinsurance of previously retained insurance if the reserves and otherliabilities with respect to previously retained insurance that aretransferred by the insurer under the proposed agreement and underall other agreements that cede previously retained insurance exceedtwenty-five percent (25%) of the total reserves and other liabilitiesof the domestic ceding insurer. As used in this subsection,"previously retained insurance" means insurance issued before thedate of reinsurance and not previously reinsured.
(c) Any agreement that is filed as provided in subsection (b) shallbe deemed approved unless the commissioner notifies the insurerwithin thirty (30) days after submission of an intent to hold a hearingin accordance with section 4 of this chapter.
(d) A transaction of indemnity reinsurance does not create anylegal right or relation between the insured, beneficiary, orpolicyholder and the accepting insurer.
As added by P.L.260-1983, SEC.1.
IC 27-6-1.1-3Repealed
(Repealed by P.L.116-1994, SEC.78.)
IC 27-6-1.1-4
Termination of indemnity reinsurance transaction
Sec. 4. The commissioner may require the termination of anyindemnity reinsurance transaction, whether or not the applicableagreement was required to be filed for approval, if after a hearingunder IC 4-21.5-3, the commissioner finds that the transactioncreates an unsafe condition for the policyholders of a domesticinsurer.
As added by P.L.260-1983, SEC.1. Amended by P.L.7-1987,SEC.152.
IC 27-6-1.1-5
Assumption reinsurance agreement; approval; exemptions; noticeto policyholders
Sec. 5. (a) A domestic insurer must file any proposed agreementof assumption reinsurance with the commissioner for thecommissioner's approval. The agreement must be executed by eachinsurer in a manner consistent with its articles and bylaws and theapplicable law.
(b) The requirement for filing and approval provided in subsection(a) is not applicable to an agreement if:
(1) the ceding insurer is not a domestic insurer; and
(2) the reserves and liabilities assumed under the agreement arenot greater than twenty percent (20%) of the correspondingoutstanding reserves and liabilities of the domestic acceptinginsurer without regard to the agreement.
(c) The commissioner shall approve a reinsurance agreementwithin sixty (60) days after it is filed as provided in subsection (a) ifthe commissioner determines that:
(1) the agreement was legally executed by both insurers;
(2) in case one (1) of the parties to the agreement is a foreign oralien insurer, the agreement received the sanction and approvalof the law of the foreign or alien jurisdiction, if necessary; and
(3) the agreement deals equitably and fairly with the contractand property rights of insurance, annuity, and endowmentpolicy or contract holders of both insurers.
(d) The commissioner's approval of any agreement of reinsurancethat is required to be filed as provided in subsection (a) shall be acondition precedent to the validity of the agreement. On thecommissioner's approval, the agreement shall become effective as ofthe date of the agreement or as of such other date as may bespecifically provided in the agreement.
(e) Within the period of forty-five (45) days following thecommissioner's approval of an agreement of assumption reinsurance,or within the period of forty-five (45) days following the effectivedate of an agreement of assumption reinsurance for which theapproval of the commissioner is not required, the accepting insurer
shall mail a written notification to each reinsured insurance, annuity,and endowment policy or contract holder. The notification must:
(1) specify each policy or contract subject to reinsurance andthe effective date of the reinsurance transaction;
(2) offer to provide a copy of the agreement of assumption ofreinsurance upon the written request of the policy or contractholder;
(3) state that the accepting insurer assumes all of the rights andobligations of the ceding insurer with respect to the policies andcontracts that are subject to the agreement of assumptionreinsurance; and
(4) state that the rights and benefits of the policy or contractholder under the policy or contract that is subject toreinsurance, including the right to surrender the policy orcontract subject to the terms of the policy or contract, are notaffected by the reinsurance.
(f) This section does not apply to an assumption reinsuranceagreement to which a domestic ceding insurer is a party if the insureris the subject of a proceeding under IC 27-9-3.
As added by P.L.260-1983, SEC.1. Amended by P.L.256-1985,SEC.1; P.L.248-1989, SEC.1.
IC 27-6-1.1-6
Application of chapter
Sec. 6. This chapter does not apply to any of the parties to acontract of merger or consolidation under IC 27-5.1-2-21.
As added by P.L.260-1983, SEC.1. Amended by P.L.129-2003,SEC.9.