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2011 Florida Statutes

F.S. 624.448
624.448 Assets of insurers; reporting requirements.
(1) As used in this section, the term:
(a) “Material acquisition of assets” or “material disposition of assets” means one or more transactions occurring during any 30-day period which are nonrecurring and not in the ordinary course of business and involve more than 5 percent of the reporting insurer’s total admitted assets as reported in its most recent statutory statement filed with the insurance department of the insurer’s state of domicile.
(b) “Material nonrenewal, cancellation, or revision of a ceded reinsurance agreement” is one that affects:
1. With respect to property and casualty business, including accident and health business written by a property and casualty insurer:
a. More than 50 percent of the insurer’s total ceded written premium; or
b. More than 50 percent of the insurer’s total ceded indemnity and loss adjustment reserves.
2. With respect to life, annuity, and accident and health business, more than 50 percent of the total reserve credit taken for business ceded, on an annualized basis, as indicated in the insurer’s most recent annual statement.
3. With respect to property and casualty business or life, annuity, and accident and health business, a material revision includes:
a. The replacement of an authorized reinsurer representing more than 10 percent of a total cession by one or more unauthorized reinsurers; or
b. The reduction or waiver, with respect to one or more unauthorized insurers, of previously established collateral requirements representing more than 10 percent of a total cession.
(2) Each domestic insurer shall file a report with the office disclosing a material acquisition of assets, a material disposition of assets, or a material nonrenewal, cancellation, or revision of a ceded reinsurance agreement, unless the material acquisition or disposition of assets or the material nonrenewal, cancellation, or revision of a ceded reinsurance agreement has been submitted to the office for review, approval, or informational purposes under another section of the Florida Insurance Code or a rule adopted thereunder. A copy of the report and each exhibit or other attachment must be filed by the insurer with the National Association of Insurance Commissioners. The report required in this section is due within 15 days after the end of the calendar month in which the transaction occurs.
(3) An immaterial acquisition or disposition of assets need not be reported under this section.
(4)(a) Acquisitions of assets which are subject to this section include each purchase, lease, exchange, merger, consolidation, succession, or other acquisition of assets. Asset acquisitions for the construction or development of real property by or for the reporting insurer and the acquisition of construction materials for this purpose are not subject to this section.
(b) Dispositions of assets which are subject to this section include each sale, lease, exchange, merger, consolidation, mortgage, hypothecation, assignment for the benefit of a creditor or otherwise, abandonment, destruction, or other disposition of assets.
(5)(a) The following information must be disclosed in any report of a material acquisition or disposition of assets:
1. The date of the transaction;
2. The manner of acquisition or disposition;
3. The description of the assets involved;
4. The nature and amount of the consideration given or received;
5. The purpose of, or reason for, the transaction;
6. The manner by which the amount of consideration was determined;
7. The gain or loss recognized or realized as a result of the transaction; and
8. The name of the person from whom the assets were acquired or to whom they were disposed.
(b) Insurers must report material acquisitions or dispositions on a nonconsolidated basis unless the insurer is part of a consolidated group of insurers which uses a pooling arrangement or a 100-percent reinsurance agreement that affects the solvency and integrity of the insurer’s reserves and the insurer has ceded substantially all of its direct and assumed business to the pool. An insurer is deemed to have ceded substantially all of its direct and assumed business to a pool if the insurer has less than $1 million in total direct and assumed written premiums during a calendar year which are not subject to a pooling arrangement and if the net income of the business which is not subject to the pooling arrangement represents less than 5 percent of the insurer’s capital and surplus.
(6) The nonrenewal, cancellation, or revision of a ceded reinsurance agreement need not be reported if the renewal or the revision is not material or if:
(a) With respect to property and casualty business, including accident and health business written by a property and casualty insurer, the insurer’s total ceded written premium represents, on an annualized basis, less than 10 percent of its total written premium for direct and assumed business; or
(b) With respect to life, annuity, and accident and health business, the total reserve credit taken for business ceded represents, on an annualized basis, less than 10 percent of the statutory reserve requirement before the cession.
(7)(a) The following information must be disclosed in any report of a material nonrenewal, cancellation, or revision of a ceded reinsurance agreement:
1. The effective date of the nonrenewal, cancellation, or revision;
2. The description of the transaction and the identification of the initiator of the transaction;
3. The purpose of, or reason for, the transaction; and
4. If applicable, the identity of each replacement reinsurer.
(b) Insurers shall report the material nonrenewal, cancellation, or revision of a ceded reinsurance agreement on a nonconsolidated basis unless the insurer is part of a consolidated group of insurers which uses a pooling arrangement or a 100-percent reinsurance agreement that affects the solvency and integrity of the insurer’s reserves and the insurer has ceded substantially all of its direct and assumed business to the pool. An insurer is deemed to have ceded substantially all of its direct and assumed business to a pool if the insurer has less than $1 million in total direct and assumed written premiums during a calendar year which are not subject to a pooling arrangement and if the net income of the business not subject to the pooling arrangement represents less than 5 percent of the insurer’s capital and surplus.
History.s. 4, ch. 97-292; s. 822, ch. 2003-261.
Note.Former s. 624.4435.