KRS 304.3-625: Exemption from requirements of KRS 304.3 -600 to 304.3 -635 and

304.99-055 -- Conditions.

(1) 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 unaffiliate d 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 w ith the Federal Crop Insurance

Corporation or the Federal Flood Program.

(2) 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 Summar y Report for any combination of insurers, provided any

combination of reports includes every insurer within the insurance group.

(3) If an insurer does not qualify for exemption pursuant to subsection (1)(a) of this

section, but the insurance group of whic h 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.

(4) 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 consider ing whether to grant the insurer's request for

a waiver.

(5) 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 base d 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 ma intain 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 determin ed by the

commissioner.

(6) 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.