2009 Iowa Code
Title 13 - Commerce
Subtitle 1 - Insurance and Related Regulation
CHAPTER 521B - CREDIT FOR REINSURANCE
521B.3 - REDUCTION FROM LIABILITY FOR REINSURANCE CEDED BY A DOMESTIC INSURER TO AN ASSUMING INSURER.

        521B.3  REDUCTION FROM LIABILITY FOR REINSURANCE CEDED
      BY A DOMESTIC INSURER TO AN ASSUMING INSURER.
         A reduction from liability for the reinsurance ceded by a domestic
      insurer to an assuming insurer not meeting the requirements of
      section 521B.2 is allowed in an amount not exceeding the liabilities
      carried by the ceding insurer and the reduction shall be in the
      amount of funds held by or on behalf of the ceding insurer, including
      funds held in trust for the ceding insurer, under a reinsurance
      contract with the assuming insurer as security for the payment of
      obligations under the reinsurance contract, if such security is 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, as defined
      in section 521B.4, subsection 2.  This security may be held in the
      form of any of the following:
         1.  Cash.
         2.  Securities listed by the securities valuation office of the
      national association of insurance commissioners and qualifying as
      admitted assets.
         3.  Clean, irrevocable, unconditional letters of credit, issued or
      confirmed by a qualified United States financial institution, as
      defined in section 521B.4, subsection 2, no later than December 31 of
      the year for which filing is being made, and in the possession of the
      ceding insurer on or before the filing date of its annual statement.

         Letters of credit meeting applicable standards of issuer
      acceptability as of the dates of their issuance or confirmation
      shall, notwithstanding the subsequent failure of the issuing or
      confirming institution or subsequent failure to meet applicable
      standards of issuer acceptability, continue to be acceptable as
      security until their expiration, extension, renewal, modification, or
      amendment, whichever first occurs.
         4.  Any other form of security acceptable to the commissioner.  

         91 Acts, ch 26, §16