2015 Kentucky Revised Statutes CHAPTER 304 - INSURANCE CODE Subtitle 3 - Authorization of Insurers and General Requirements 3.3-625 Exemption from requirements of KRS 304.3-600 to 304.3-635 and 304.99-055 -- Conditions.
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304.3-625
Exemption from requirements of KRS 304.3-600 to 304.3-635 and
304.99-055 -- Conditions.
(1)
(2)
(3)
(4)
(5)
An insurer shall be exempt from the requirements of KRS 304.3-600 to 304.3-635
and 304.99-055 if:
(a) The insurer has annual direct written and unaffiliated assumed premium in an
amount less than five hundred million dollars ($500,000,000), including
international direct and assumed premium, but excluding premiums reinsured
with the Federal Crop Insurance Corporation or the Federal Flood Program;
and
(b) The insurance group of which the insurer is a member has annual direct
written and unaffiliated assumed premium in an amount less than one billion
dollars ($1,000,000,000), including international direct and assumed
premium, but excluding premiums reinsured with the Federal Crop Insurance
Corporation or the Federal Flood Program.
If an insurer qualifies for exemption pursuant to subsection (1)(a) of this section,
but the insurance group of which the insurer is a member does not qualify for the
exemption pursuant to subsection (1)(b) of this section, the ORSA Summary Report
that may be required pursuant to KRS 304.3-620 shall include every insurer within
the insurance group. This requirement may be satisfied by the submission of more
than one (1) ORSA Summary Report for any combination of insurers, provided any
combination of reports includes every insurer within the insurance group.
If an insurer does not qualify for exemption pursuant to subsection (1)(a) of this
section, but the insurance group of which it is a member qualifies for exemption
pursuant to subsection (1)(b) of this section, the only ORSA Summary Report that
may be required pursuant to KRS 304.3-620 shall be the report applicable to the
insurer that does not qualify for the exemption.
An insurer that does not qualify for exemption pursuant to subsection (1) of this
section may apply to the commissioner for a waiver from the requirements of KRS
304.3-600 to 304.3-635 and 304.99-055, based upon unique circumstances. In
deciding whether to grant the insurer's request for waiver, the commissioner may
consider the type and volume of business written, ownership and organizational
structure of the insurer, and any other factor the commissioner considers relevant to
the insurer or insurance group of which the insurer is a member. If the insurer is part
of an insurance group, with insurers domiciled in more than one (1) state, the
commissioner shall coordinate with the lead state commissioner and with the other
domiciliary commissioners in considering whether to grant the insurer's request for
a waiver.
Notwithstanding the exemptions stated in this section:
(a) The commissioner may require that an insurer maintain a risk management
framework, conduct an ORSA, and file an ORSA Summary Report based on
unique circumstances, including but not limited to the type and volume of
business written, ownership and organizational structure, federal agency
requests, and international supervisor requests; and
(b)
(6)
The commissioner may require that an insurer maintain a risk management
framework, conduct an ORSA, and file an ORSA Summary Report if the
insurer:
1.
Has risk-based capital for a company action level event as set forth in
KRS 304.3-120, 304.3-190, and 304.38-070, and any applicable
administrative regulations;
2.
Meets one (1) or more of the standards of an insurer deemed to be in
hazardous financial condition as described in KRS 304.2-065 and any
applicable administrative regulations; or
3.
Otherwise exhibits qualities of a troubled insurer as determined by the
commissioner.
If an insurer that qualifies for an exemption pursuant to subsection (1) of this
section then subsequently does not qualify for that exemption due to changes in
premium as reflected in the insurer's most recent annual statement or in the most
recent annual statements of the insurers within the insurance group of which the
insurer is a member, the insurer shall have one (1) year, following the year the
threshold is exceeded, to comply with the requirements of KRS 304.3-600 to 304.3635 and 304.99-055.
Effective: January 1, 2015
History: Created 2014 Ky. Acts ch. 119, sec. 6, effective January 1, 2015.
Legislative Research Commission Note (1/1/2015). In 2014 Ky. Acts ch. 119, sec. 6
(this statute), the phrase "standards of an insurer deemed to be in hazardous financial
condition as defined in KRS 304.2-065 and any applicable administrative
regulations" was used in subsection (5)(b)2. Standards to be used by the
Commissioner of Insurance in determining whether an insurer is in hazardous
financial condition are contained in KRS 304.2-065 and 806 KAR 2:150, but are not
technically defined in either. In codification, the Reviser of Statutes has changed the
word "defined" to "described" for the sake of clarity and accuracy to avoid
confusion.
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