Risk Retention Group (E) Task Force
December 2, 2003
The Risk Retention Group (E) Task Force met on Sunday, December 2, 2007. During this meeting, the Task Force:
The Task Force held one conference call since its Fall National Meeting. As part of this call, the proposed draft reinsurance guidelines that were initially released for comment by the Task Force until Aug. 22, 2007, and then subsequently re-released for comment until Oct. 15, 2007, were further discussed and revised. The draft guidelines indicate that credit for reinsurance may be permitted in situations not meeting the criteria included in the Credit for Reinsurance models without posting collateral if: (1) the reinsurer maintains an A- or higher A.M. Best rating, maintains a minimum policyholder surplus in an amount acceptable to the Commissioner based upon a review of the most recent audited financial statements and is licensed and domiciled in a jurisdiction acceptable to the Commissioner; or (2) if the reinsurer satisfies various requirements, including filing audited financial statements, maintaining a premiums written to surplus ratio of not more than 3 to 1 and submitting to the examination authority of the Commissioner.
The guidelines also indicate that, upon application, the Commissioner may waive some of the reinsurance requirements in circumstances where the risk retention group (RRG) licensed as a captive insurer or reinsurer can demonstrate to the satisfaction of the Commissioner that: (1) the reinsurer is sufficiently capitalized based upon a review of the most recent audited financial statements; (2) the reinsurer is licensed and domiciled in a jurisdiction satisfactory to the Commissioner; and (3) the proposed reinsurance agreement adequately protects the RRG licensed as a captive insurer and its policyholders.
During the meeting, the Task force discussed various editorial and technical changes and agreed to review the guidelines further during a future conference call.
Action Items: