By: Creighton S.B. No. 1093
(Sheets)
A BILL TO BE ENTITLED
AN ACT
relating to credit to certain ceding insurers for reinsurance ceded
to certain assuming insurers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 492.104(b), Insurance Code, is amended
to read as follows:
(b) The funds held as security:
(1) must be held in the United States subject to
withdrawal solely by and under the exclusive control of the ceding
insurer or, in the case of a trust, held in a qualified United
States financial institution that has been granted the authority to
operate with fiduciary powers; and
(2) may be in the form of:
(A) cash;
(B) securities that[:
[(i) are readily marketable over a national
exchange;
[(ii) have a maturity date of not later than
one year;
[(iii)] are listed by the Securities
Valuation Office of the National Association of Insurance
Commissioners[;] and
[(iv)] qualify as admitted assets;
(C) subject to Section 492.105, a clean,
irrevocable, unconditional letter of credit, issued or confirmed by
a qualified United States financial institution that has been
determined by the commissioner or the Securities Valuation Office
of the National Association of Insurance Commissioners to meet the
standards of financial condition and standing that are considered
necessary and appropriate to regulate the quality of financial
institutions whose letters of credit will be acceptable to the
commissioner; or
(D) another form of security acceptable to the
commissioner.
SECTION 2. Section 493.104(b), Insurance Code, is amended
to read as follows:
(b) The funds held as security:
(1) must be held in the United States subject to
withdrawal solely by and under the exclusive control of the ceding
insurer or, in the case of a trust, held in a qualified United
States financial institution that has been granted the authority to
operate with fiduciary powers; and
(2) may be in the form of:
(A) cash;
(B) securities that[:
[(i) are readily marketable over a national
exchange;
[(ii) have a maturity date of not later than
one year;
[(iii)] are listed by the Securities
Valuation Office of the National Association of Insurance
Commissioners[;] and
[(iv)] qualify as admitted assets;
(C) subject to Section 493.105, a clean,
irrevocable, unconditional letter of credit, issued or confirmed by
a qualified United States financial institution that has been
determined by the commissioner or the Securities Valuation Office
of the National Association of Insurance Commissioners to meet the
standards of financial condition and standing that are considered
necessary and appropriate to regulate the quality of financial
institutions whose letters of credit will be acceptable to the
commissioner; or
(D) another form of security acceptable to the
commissioner.
SECTION 3. This Act applies to funds held as security on or
after the effective date of this Act.
SECTION 4. This Act takes effect September 1, 2015.