North Carolina General Statutes 58-10-65. Nonrenewals, cancellations, or revisions of ceded reinsurance agreements
(a) Insurers do not have to report nonrenewals, cancellations, or revisions of ceded reinsurance agreements under N.C. Gen. Stat. § 58-10-55 if they are not material. For the purposes of this Part, a nonrenewal, cancellation, or revision of a ceded reinsurance agreement is considered material and must be reported if:
(1) It is for property and casualty business, including accident and health business written by a property and casualty insurer and affects:
a. More than fifty percent (50%) of the insurer’s total ceded written premium; or
b. More than fifty percent (50%) of the insurer’s total ceded indemnity and loss adjustment reserves.
Terms Used In North Carolina General Statutes 58-10-65
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- following: when used by way of reference to any section of a statute, shall be construed to mean the section next preceding or next following that in which such reference is made; unless when some other section is expressly designated in such reference. See North Carolina General Statutes 12-3
- property: shall include all property, both real and personal. See North Carolina General Statutes 12-3
(2) It is for life, annuity, and accident and health business and affects more than fifty percent (50%) of the total reserve credit taken for business ceded, on an annualized basis, as indicated in the insurer’s most recent annual statement.
(3) It is for either property and casualty, or life, annuity, and accident and health business, and:
a. An authorized reinsurer representing more than ten percent (10%) of a total cession is replaced by one or more unauthorized reinsurers; or
b. Previously established collateral requirements have been reduced or waived with respect to one or more unauthorized reinsurer’s representing collectively more than ten percent (10%) of a total cession.
(b) No filing is required if:
(1) For 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 ten percent (10%) of its total written premium for direct and assumed business.
(2) For life, annuity, and accident and health business, the total reserve credit taken for business ceded represents, on an annualized basis, less than ten percent (10%) of the statutory reserve requirement before any cession.
(c) The following information shall be disclosed in any report under this section:
(1) Effective date of the nonrenewal, cancellation, or revision.
(2) Description of the transaction, with an identification of the initiator of the transaction.
(3) Purpose of, or reason for, the transaction.
(4) If applicable, identity of the replacement reinsurers.
(d) Every insurer shall report all material nonrenewals, cancellations, or revisions of ceded reinsurance agreements on a nonconsolidated basis unless the insurer is part of a consolidated group of insurers that uses a pooling arrangement or one hundred percent (100%) reinsurance agreement that affects the solvency and integrity of the insurer’s reserves and the insurer ceded substantially all of its direct and assumed business to the pool. An insurer cedes substantially all of its direct and assumed business to a pool if the insurer has less than one million dollars ($1,000,000) total direct plus assumed written premiums during a calendar year that are not subject to the pooling arrangement and the net income of the business not subject to the pooling arrangement represents less than five percent (5%) of the insurer’s capital and surplus. (1995, c. 318, s. 1.)