Affiliate: means a person who controls, is controlled by, or is under common control with, another person. See Utah Code 31A-1-301
Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
authorized insurer: means an insurer:
(i)
holding a valid certificate of authority to do an insurance business in this state; and
(ii)
transacting business as authorized by a valid certificate. See Utah Code 31A-1-301
board of directors: means the group of persons with responsibility over, or management of, a corporation, however designated. See Utah Code 31A-1-301
Controlling person: means a person that directly or indirectly has the power to direct or cause to be directed, the management, control, or activities of a reinsurance intermediary. See Utah Code 31A-1-301
Enterprise risk: means an activity, circumstance, event, or series of events involving one or more affiliates of an insurer that, if not remedied promptly, is likely to have a material adverse effect upon the financial condition or liquidity of the insurer or its insurance holding company system as a whole, including anything that would cause:
(a)
the insurer's risk-based capital to fall into an action or control level as set forth in Sections 31A-17-601 through 31A-17-613; or
Group-wide supervisor: means the commissioner or other regulatory official designated as the group-wide supervisor for an internationally active insurance group under Section 31A-16-108. See Utah Code 31A-1-301
Insurance: includes :
(i)
a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
(ii)
a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
(iii)
a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
Insurance holding company system: means a group of two or more affiliated persons, at least one of whom is an insurer. See Utah Code 31A-1-301
Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
Member: means a person having membership rights in an insurance corporation. See Utah Code 31A-1-301
Month: means a calendar month, unless otherwise expressed. See Utah Code 68-3-12.5
NAIC: means the National Association of Insurance Commissioners. See Utah Code 31A-1-301
NAIC liquidity stress test framework: means a NAIC publication that includes:
(a)
a history of the NAIC's development of regulatory liquidity stress testing;
(b)
the scope criteria applicable for a specific data year; and
(c)
the liquidity stress test instructions and reporting templates for a specific data year, as adopted by the NAIC and as amended by the NAIC in accordance with NAIC procedures. See Utah Code 31A-1-301
Oversight: Committee review of the activities of a Federal agency or program.
Person: includes :
(a)
an individual;
(b)
a partnership;
(c)
a corporation;
(d)
an incorporated or unincorporated association;
(e)
a joint stock company;
(f)
a trust;
(g)
a limited liability company;
(h)
a reciprocal;
(i)
a syndicate; or
(j)
another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301
Scope criteria: means the designated exposure bases and minimum magnitudes for a specified data year that are used to establish a preliminary list of insurers considered scoped into the NAIC liquidity stress test framework for that data year. See Utah Code 31A-1-301
State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
Statute: A law passed by a legislature.
United States: includes each state, district, and territory of the United States of America. See Utah Code 68-3-12.5
(a)
An insurer that is authorized to do business in this state and that is a member of an insurance holding company system shall register with the commissioner, except a foreign insurer subject to registration requirements and standards adopted by statute or regulation in the jurisdiction of its domicile, if the requirements and standards are substantially similar to those contained in this section, Subsections 31A-16-106(1)(a) and (2) and either Subsection 31A-16-106(1)(b) or a statutory provision similar to the following: “Each registered insurer shall keep current the information required to be disclosed in its registration statement by reporting all material changes or additions within 15 days after the end of the month in which it learns of each change or addition.”
(b)
An insurer that is subject to registration under this section shall register within 15 days after it becomes subject to registration, and annually thereafter by June 30 of each year for the previous calendar year, unless the commissioner for good cause extends the time for registration and then at the end of the extended time period. The commissioner may require any insurer authorized to do business in the state, which is a member of a holding company system, and which is not subject to registration under this section, to furnish a copy of the registration statement, the summary specified in Subsection (3), or any other information filed by the insurer with the insurance regulatory authority of domiciliary jurisdiction.
(2)
An insurer subject to registration shall file the registration statement with the commissioner on a form and in a format prescribed by the NAIC, which shall contain the following current information:
(a)
the capital structure, general financial condition, and ownership and management of the insurer and any person controlling the insurer;
(b)
the identity and relationship of every member of the insurance holding company system;
(c)
any of the following agreements in force, and transactions currently outstanding or which have occurred during the last calendar year between the insurer and its affiliates:
(i)
loans, other investments, or purchases, sales or exchanges of securities of the affiliates by the insurer or of securities of the insurer by its affiliates;
(ii)
purchases, sales, or exchanges of assets;
(iii)
transactions not in the ordinary course of business;
(iv)
guarantees or undertakings for the benefit of an affiliate which result in an actual contingent exposure of the insurer’s assets to liability, other than insurance contracts entered into in the ordinary course of the insurer’s business;
(v)
all management agreements, service contracts, and all cost-sharing arrangements;
(vi)
reinsurance agreements;
(vii)
dividends and other distributions to shareholders; and
(viii)
consolidated tax allocation agreements;
(d)
any pledge of the insurer’s stock, including stock of any subsidiary or controlling affiliate, for a loan made to any member of the insurance holding company system;
(e)
if requested by the commissioner, financial statements of or within an insurance holding company system, including all affiliates:
(i)
which may include annual audited financial statements filed with the United States Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended; and
(ii)
which request is satisfied by providing the commissioner with the most recently filed parent corporation financial statements that have been filed with the United States Securities and Exchange Commission;
(f)
any other matters concerning transactions between registered insurers and any affiliates as may be included in any subsequent registration forms adopted or approved by the commissioner;
(g)
statements that the insurer’s board of directors oversees corporate governance and internal controls and that the insurer’s officers or senior management have approved, implemented, and continue to maintain and monitor corporate governance and internal control procedures; and
All registration statements shall contain a summary outlining all items in the current registration statement representing changes from the prior registration statement.
(4)
(a)
No information need be disclosed on the registration statement filed pursuant to Subsection (2) if the information is not material for the purposes of this section.
(b)
Unless the commissioner by rule or order provides otherwise, sales, purchases, exchanges, loans or extensions of credit, investments, or guarantees involving one-half of 1%, or less, of an insurer’s admitted assets as of the next preceding December 31 may not be considered material for purposes of Subsection (2).
(5)
Subject to Section 31A-16-106, each registered insurer shall report to the commissioner a dividend or other distribution to shareholders within 15 business days following the declaration of the dividend or distribution.
(6)
Any person within an insurance holding company system subject to registration shall provide complete and accurate information to an insurer if the information is reasonably necessary to enable the insurer to comply with the provisions of this chapter.
(7)
The commissioner shall terminate the registration of any insurer which demonstrates that it no longer is a member of an insurance holding company system.
(8)
The commissioner may require or allow two or more affiliated insurers subject to registration under this section to file a consolidated registration statement.
(9)
The commissioner may allow an insurer which is authorized to do business in this state, and which is part of an insurance holding company system, to register on behalf of any affiliated insurer which is required to register under Subsection (1) and to file all information and material required to be filed under this section.
(10)
This section does not apply to any insurer, information, or transaction if, and to the extent that, the commissioner by rule or order exempts the insurer from this section.
(11)
Any person may file with the commissioner a disclaimer of affiliation with any authorized insurer, or a disclaimer of affiliation may be filed by any insurer or any member of an insurance holding company system. The disclaimer shall fully disclose all material relationships and bases for affiliation between the person and the insurer as well as the basis for disclaiming the affiliation. A disclaimer of affiliation is considered to have been granted unless the commissioner, within 30 days following receipt of a complete disclaimer, notifies the filing party the disclaimer is disallowed. If disallowed, the disclaiming party may request an administrative hearing, which shall be granted. The disclaiming party shall be relieved of its duty to register under this section if approval of the disclaimer is granted by the commissioner, or if the disclaimer is considered to have been approved.
(12)
The ultimate controlling person of an insurer subject to registration shall also file an annual enterprise risk report. The annual enterprise risk report shall, to the best of the ultimate controlling person’s knowledge and belief, identify the material risks within the insurance holding company that could pose enterprise risk to the insurer. The annual enterprise risk report shall be filed with the lead state commissioner of the insurance holding company system as determined by the procedures within the Financial Analysis Handbook adopted by the NAIC.
(13)
(a)
The ultimate controlling person of an insurer subject to registration shall concurrently file with the registration an annual group capital calculation report as directed by the lead state commissioner.
(b)
The annual group capital calculation report described in Subsection (13)(a) shall be filed with the lead state commissioner of the insurance holding company system as determined by the commissioner in accordance with the procedures within the Financial Analysis Handbook adopted by the NAIC.
(c)
Subject to Subsections (13)(d) and (e), the following insurance holding company systems are exempt from filing the annual group capital calculation report described in Subsection (13)(a):
(i)
an insurance holding company system that:
(A)
has only one insurer within the insurance holding company’s structure;
(B)
writes business and is licensed only in the insurance holding company system’s domestic state; and
(C)
assumes no business from any other insurer;
(ii)
an insurance holding company system that is required to perform a group capital calculation specified by the United States Federal Reserve Board unless:
(A)
the lead state commissioner requests the calculation from the Federal Reserve Board under the terms of information sharing agreements in effect; and
(B)
the Federal Reserve Board cannot share the calculation with the lead state commissioner;
(iii)
an insurance holding company system whose non-United States group-wide supervisor is located within a reciprocal jurisdiction as described in Subsection 31A-17-404(8) that recognizes the United States’ state regulatory approach to group supervision and group capital; and
(iv)
an insurance holding company system:
(A)
that provides information to the lead state that meets the requirements for accreditation under the NAIC financial standards and accreditation program, either directly or indirectly through the group-wide supervisor, who has determined the information is satisfactory to allow the lead state to comply with the NAIC group supervision approach, as detailed in the NAIC Financial Analysis Handbook; and
(B)
whose non-United States group-wide supervisor that is not located in a reciprocal jurisdiction recognizes and accepts, as specified by the lead state commissioner in regulation, the group capital calculation as the world-wide group capital assessment for United States insurance groups that operate in that jurisdiction.
(d)
If, after consultation with other supervisors or officials, the lead state commissioner determines appropriate for prudential oversight and solvency monitoring purposes or for ensuring the competitiveness of the insurance marketplace, the lead state commissioner shall require the group capital calculation for United States operations of any non-United States based insurance holding company system.
(e)
The lead state commissioner may:
(i)
exempt the ultimate controlling person from filing the annual group capital calculation; or
(ii)
accept a limited group capital filing or report in accordance with criteria as specified by the lead state commissioner in regulation.
(f)
If the lead state commissioner determines that an insurance holding company system no longer meets one or more of the requirements for an exemption from filing the group capital calculation under this section, the insurance holding company system shall file the group capital calculation at the next annual filing date unless the lead state commissioner gives an extension based on reasonable grounds.
(14)
(a)
The ultimate controlling person of every insurer subject to registration and also scoped into the NAIC liquidity stress test framework shall file the results of a specific year’s liquidity stress test.
(b)
The filing described in Subsection (14)(a) shall be made to the lead state insurance commissioner of the insurance holding company system as determined by the procedures within the Financial Analysis Handbook adopted by the NAIC.
(c)
Any change to the NAIC liquidity stress test framework or to the data year for which the scope criteria are to be measured shall be effective on January 1 of the year following the calendar year in which the change is adopted.
(d)
Insurers meeting at least one threshold of the NAIC liquidity stress test framework’s scope criteria are scoped into the NAIC liquidity stress test framework for the specified data year unless the lead state insurance commissioner, in consultation with the NAIC Financial Stability Task Force or the NAIC Financial Stability Task Force’s successor, determines the insurer should not be scoped into the NAIC liquidity stress test framework for that data year.
(e)
Insurers that do not meet at least one threshold of the NAIC liquidity stress test framework’s scope criteria are scoped out of the NAIC liquidity stress test framework for the specified data year, unless the lead state insurance commissioner, in consultation with the NAIC Financial Stability Task Force or the NAIC Financial Stability Task Force’s successor, determines the insurer should be scoped into the NAIC liquidity stress test framework for that data year.
(f)
To avoid having insurers scoped in and out of the NAIC liquidity stress test framework on a frequent basis, the lead state insurance commissioner, in consultation with the Financial Stability Task Force or the NAIC Financial Stability Task Force’s successor, shall assess this concern as part of the lead state insurance commissioner’s determination of whether an insurer is scoped into the NAIC liquidity stress test framework for a specified data year.
(g)
The performance of, and filing of the results from, a specific year’s liquidity stress test shall comply with:
(i)
the NAIC liquidity stress test framework instructions and reporting templates for that year; and
(ii)
lead state insurance commissioner determinations made in conjunction with the NAIC Financial Stability Task Force or the NAIC Financial Stability Task Force’s successor, provided within the NAIC liquidity stress test framework.
(15)
The failure to file a registration statement or any summary of the registration statement or enterprise risk filing required by this section within the time specified for the filing is a violation of this section.
