N.Y. Insurance Law § 1312: Trusteed surplus of alien insurers; impairment

§ 1312. Trusteed surplus of alien insurers; impairment. (a) (1) In

addition to other requirements of this chapter every authorized alien

insurer shall, not later than the first day of March in each year, file

with the superintendent a statement (herein called a "trusteed surplus

statement"), on a form prescribed by him, showing at last year-end:

(A) all its general state deposits, meaning assets within the United

States deposited with officers of any state in trust for the security of

all its policyholders, or policyholders and creditors, within the United

States;

(B) all its special state deposits, meaning assets within the United

States deposited with officers of any state in trust for the security of

its policyholders, or policyholders and creditors, in a particular

state;

(C) all its trusteed assets, meaning assets within the United States

held by a trustee or trustees for the security of all its policyholders,

or policyholders and creditors, within the United States;

(D) if a life insurance company, the amount of its policy loans to

policyholders within the United States, not exceeding the amount of the

legal reserve required on each such policy;

(E) all its reserves and other liabilities arising out of policies or

obligations issued, assumed or incurred in the United States; and

(F) such further information as may be necessary to apply the

provisions of this section.

(2) In determining the net amount of the insurer's liabilities in the

United States, a deduction may be made: (i) for reinsurance on losses

with authorized insurers, less unpaid reinsurance premiums, with a

schedule showing by companies the amount deducted, and (ii) for unearned

premiums on agents' balances or uncollected premiums not more than

ninety days past due. Any liability on an asset not considered in such

statement may be applied against such asset.

(3) No credit shall be allowed in such statement for any special state

deposit held for the exclusive benefit of policyholders, or

policyholders and creditors, of any particular state except as an offset

against the liabilities of such alien insurer in such state.

(4) The accrued interest at date of statement on assets deposited with

states and trustees shall be allowed in such statement, where such

interest is collected by the states or trustees.

(b) (1) Such trusteed surplus statement shall be signed and verified

by the United States manager, attorney-in-fact, or a duly empowered

assistant United States manager, of the alien insurer. The items of

securities and other property held under trust deeds shall be certified

to by the United States trustee or trustees. The superintendent may at

any time require a further statement of the same kind and of such date

as he may determine.

(2) Every report on examination of the United States branch of an

alien insurer shall include a trusteed surplus statement as of the date

of examination in addition to the general statement of the financial

condition of such United States branch.

(c) (1) The aggregate value of the insurer's general state deposits

and trusteed assets less the aggregate net amount of all of its

liabilities and reserves in the United States as determined in

accordance with this section shall be known as its "trusteed surplus" in

the United States. Whenever it appears to the superintendent from any

such statement or any report that an alien insurer's trusteed surplus is

reduced below the greater of the minimum capital required of, or the

minimum surplus to policyholders required to be maintained by, a

domestic insurer licensed to transact the same kinds of insurance, he

shall determine the amount of such impairment and order the insurer,

through its United States manager or attorney, to eliminate such

impairment within such period as he designates, not more than ninety

days from service of the order. He may also by order revoke or suspend

such insurer's license or prohibit it from issuing new policies in the

United States while such impairment exists.

(2) If at the expiration of such designated period such insurer has

not satisfied the superintendent that such impairment has been

eliminated, the superintendent may proceed against such insurer pursuant

to the provisions of article seventy-four of this chapter as an insurer

whose condition is such that its further transaction of business in the

United States will be hazardous to its policyholders, its creditors or

the public in the United States.