N.Y. Insurance Law § 6111: Assets, liabilities and surplus

§ 6111. Assets, liabilities and surplus. (a) All of the assets of any

reciprocal insurer including subscribers' operating reserves shall be

liable primarily for payment of all liabilities incurred under its

policies or other contracts.

(b) No part of the surplus funds of such reciprocal insurer shall be

subject to the claims of general creditors of any of the individual

subscribers of such insurer until all policies under which any such

subscriber is obligated have been terminated and in no event beyond the

amount of such subscriber's operating reserve.

(c) The contingent liability of subscribers for additional premiums or

assessments shall not be included as an asset in the financial statement

of a reciprocal insurer.

(d) Subscribers' operating reserves for which notice of withdrawal has

been given shall be reported as liabilities until paid.

(e) In any statement or report of the financial condition of a

reciprocal insurer filed in this state, the surplus to policyholders,

after providing for the unearned premium reserves, loss reserves and

other liabilities, as required by this chapter, shall be reported as

follows:

(1) special contingent surplus;

(2) subscribers' operating reserves, if required;

(3) all other surplus, if any.

(f) Unless the reciprocal is subject to the provisions of article

fifteen of this chapter or substantially similar legislation in its

state of domicile, all material transactions between or among the

reciprocal, its subscribers, the attorney-in-fact and any affiliate of

the attorney-in-fact shall not be entered into, unless they have been

filed with the superintendent at least thirty days prior thereto and the

superintendent has not disapproved them; provided, however, that any

such transaction involving five percent or more of the reciprocal's

admitted assets shall be subject to prior approval of the superintendent

and all transactions shall meet the following standards:

(1) The terms shall be fair and equitable;

(2) Charges or fees for services performed shall be reasonable; and

(3) Expenses incurred and payments received shall be allocated to the

reciprocal on an equitable basis in conformity with statutory insurance

accounting practices consistently applied.