2014 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) The commissioner may require that an insurer maintain a risk
(6)
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 304.3-635 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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