FOREIGN INSURANCE COMPANIES AND THEIR AGENTS
Licenses for Companies
No insurance company not organized under the laws of this state shall do insurance business within the state unless it has obtained a license from the insurance commissioner authorizing it to do so.
Source. GL 174:22. 1889, 86:1. PS 169:1. PL 275:1. RL 325:1.
405:2 Stock Company.
No such stock insurance company shall be licensed to do business in the state unless it shall possess a paid-up capital of $800,000, invested in securities readily convertible into cash, 1/2 at least of which are not loans secured by real estate; nor unless it shall possess, in addition to such capital, assets equal in amount to all its outstanding liabilities, estimating 50 percent of premiums received on unexpired fire risks running one year or less from date of policy, and a pro rata amount of all premiums received on unexpired risks running more than one year from date of policy, and on marine risks 50 percent of the amount of premiums written on policies upon yearly risks, and upon risks covering more than one passage not terminated, and the full amount of premiums written on policies of all other marine risks not terminated as a liability.
Source. 1870, 1:1. 1875, 38:1. 1876, 11:1. GL 174:1. PS 169:2. 1907, 10:1; 37:1. 1921, 128:1. PL 275:2. RL 325:2. 1947, 182:5. RSA 405:2. 1969, 283:5, eff. June 25, 1969.
405:3 Life Insurance Company.
If it is a life insurance company the premium reserve on life risks, based on the actuaries' table of mortality, with interest at 4 percent, shall be treated as a liability.
Source. 1870, 1:1. 1875, 38:1. 1876, 11:1. GL 174:1. PS 169:2. PL 275:3. RL 325:3.
405:4 Mutual Insurance Company.
No such mutual insurance company shall be licensed to do business in the state unless it shall possess $800,000 of surplus to policyholders invested as provided in RSA 405:2, nor unless its assets equal its outstanding liabilities, including reinsurance, to be estimated as in the case of joint stock insurance companies, and including also the amount of its guaranteed capital.
Source. 1870, 1:1. 1875, 38:1. 1876, 11:1. GL 174:1. PS 169:3. PL 275:4. RL 325:4. RSA 405:4. 1969, 283:6, eff. June 25, 1969.
405:5 Repealed by 1969, 283:7, eff. June 25, 1969.
405:6 Non-assessable Policies.
Any mutual fire or casualty insurance company now or hereafter admitted to transact business in this state may issue non-assessable policies in compliance with the requirements of RSA 402:2, except that the deposit required by said section may be made in the home state of such admitted company in cash or securities legal for investments by such companies in such home state. Any deposit required for the purposes specified in this section shall be inclusive of any deposit required by any other state, provided that such deposit is for the benefit of all policyholders in the United States.
Source. 1941, 122:2. RL 325:6.
405:7 Net Assets.
The term net assets, as used herein, shall be taken to mean the funds of an insurance company available for the payment of its obligations in this state, including, in the case of a mutual company, its deposit notes or other contingent funds, its subscription fund and premium notes absolutely due, and also including uncollected and deferred premiums not more than 3 months due, on policies actually in force, after deducting from such funds all unpaid losses and claims, and claims for losses, and all other debts and liabilities inclusive of policy liability and exclusive of capital.
Source. 1919, 23:1. PL 275:6. RL 325:7.
405:8 Mill Mutuals.
Mutual fire or mutual employer's liability insurance companies incorporated under the laws of other states, which insure only factories or mills or property connected with such factories or mills, may be admitted to this state upon complying with the conditions set forth herein, and shall comply with all the requirements hereof, except that, in lieu of all other taxation upon premiums in this state, such companies shall annually pay a tax at the rate of 2 percent on gross premiums in force on risks in this state after deducting the unabsorbed portion of such premium computed at the rate of return actually made on annual policies expiring during the year by said insurance companies.
Source. 1913, 90:1. PL 275:7. RL 325:8.
Such companies shall, on or before March 1, make a return, under oath, to the commissioner, showing the gross premiums in force on risks in this state on December 31 previous and the unabsorbed portion of such premiums computed at the rate of return actually made on annual policies expiring during the year by said companies.
Source. 1913, 90:1. PL 275:8. 1929, 13:1. RL 325:9.
405:10 Service of Process Through Insurance Commissioner.
No such joint stock or mutual insurance company, nor its agents, shall do business in this state until it has filed with the commissioner a written stipulation, agreeing that legal process affecting the company, served on the commissioner for the time being, shall have the same effect as if served personally on the company within the state. Service of such process shall be made by leaving a copy of the process in the hands of the commissioner or in his office and paying to the commissioner a fee as prescribed by RSA 400-A:29.
Source. 1870, 1:1. 1875, 38:1. 1876, 11:1. GL 174:1. PS 169:4. PL 275:9. 1933, 32:1. RL 325:10. RSA 405:10. 1971, 244:2, eff. Aug. 17, 1971.
405:11 Preliminary Statements.
Before a license is granted to a company it shall file with the commissioner a certified copy of its charter and by-laws and a full statement, under oath, of its president and secretary, showing the financial standing and condition of the company, in accordance with blanks furnished by the commissioner, except in cases where the company has already filed such papers, and shall otherwise comply with all laws relating to such companies.
Source. GL 174:2. 1889, 86:1. PS 169:5. PL 275:10. RL 325:11.
I. No foreign insurer which is directly or indirectly owned or controlled in whole or in substantial part by any government or governmental agency shall be authorized to transact insurance in this state. Membership in a mutual insurer or subscribership in a reciprocal insurer or ownership of stock in an insurer by the alien property custodian or similar official of the United States or ownership of stock or other security which does not have voting rights with respect to the management of the insurer or supervision of an insurer by public authority shall not be deemed to be an ownership or control of the insurer for the purposes of this section.
II. The commissioner shall not grant or continue authority to transact insurance in this state as to any insurer or proposed insurer that management of which is found by the commissioner after investigation or upon reliable information to be incompetent or dishonest or untrustworthy or of unfavorable business repute or so lacking in insurance company managerial experience in operations of the kind proposed in this state as to make such operation, currently or prospectively, hazardous to or contrary to the best interests of, the insurance-buying or investing public of this state, or which the commissioner has good reason to believe is affiliated directly or indirectly through ownership, control, reinsurance transactions, or other business relations with any person or persons of unfavorable business repute or whose business operations are or have been marked, to the injury of insurers, stockholders, policyholders, creditors, or the public, by illegality, or by manipulation of assets or of accounts or of reinsurance or by bad faith.
Source. 2008, 18:13, eff. July 11, 2008.
I. If the foregoing provisions are complied with and the commissioner is satisfied that the company (a) has the requisite capital and assets; (b) is a safe, reliable company, entitled to confidence; and (c) is consistent with the NAIC's Uniform Certificate of Authority Application process and standards, the commissioner shall grant a license to it to do insurance business by authorized agents within the state, subject to the laws of the state, until June 14 thereafter. Annually thereafter, on June 14, such license may be renewed so long as the company shall comply with the requirements of the law, NAIC guidelines, and the commissioner shall regard it as safe, reliable and entitled to confidence, and so long as the company continues to conduct a meaningful insurance business, as determined by the commissioner, within New Hampshire.
II. Every insurance company shall conduct its business in the legal name of the insurer as it appears on the insurer's application filed with the NAIC for a company code number. If an insurer is part of a group of affiliated insurers, the group name may appear in addition to the name of the individual insuring company, but the group name shall not be used in lieu of the legal name of the individual company.
(a) All insurance policies and contracts, and any endorsements or amendments separately issued and intended to be attached to such policies or contracts, shall identify the legal name, as set forth in paragraph II, of the insurer that is directly assuming the obligations under the policy or contract. Inclusion of the legal name of the insurer in a policy jacket, declaration, or other similar cover page issued with the policy, contract, or endorsement shall be deemed to be in compliance with this requirement.
(b) Identification of the insuring company on any advertisement or promotional materials shall be governed by the laws or rules related to the advertisements, misrepresentations in sale of insurance, and misrepresentation in insurance transactions.
Source. GL 174:2. 1889, 86:1. PS 169:6. PL 275:11. RL 325:12. RSA 405:12. 1973, 74:3. 1977, 232:5. 1983, 371:3. 2009, 215:2, eff. Jan. 1, 2010. 2021, 207:2, Pt. VI, Sec. 2, eff. Oct. 9, 2021.
405:13 Revocation or Restriction of License.
Such license may be revoked or restricted at any time by the commissioner for the causes and in the manner prescribed by law.
Source. GL 174:2. 1889, 86:1. PS 169:6. PL 275:12. RL 325:13. RSA 405:13. 1975, 229:2, eff. Aug. 2, 1975.
405:14 Notice of Revocation.
If, in the opinion of the commissioner, the affairs of a foreign company so licensed are in an unsound or failing condition he shall revoke its license and all licenses that have been granted to its agents, by giving written notice of the revocation to the company and publishing a like notice in the newspaper published in Concord having the largest circulation in the state, and in the like newspaper published in Manchester.
Source. 1870, 1:5. GL 171:6. PS 169:6. PL 275:13. RL 325:14.
405:14-a New License Required for Changed Conditions.
The commissioner shall require a company licensed under this chapter to apply for a license in accordance with this chapter, if after notifying the company and after holding a hearing if requested, the commissioner finds that the company has undergone a substantial change in finances or managerial control since its last application for a license. The current license shall expire upon approval of the new application of the company or 30 days after the decision of the commissioner that a substantial change has occurred, whichever is sooner.
Source. 1975, 313:2, eff. Aug. 6, 1975.
Licenses for Agents of Foreign Companies
405:15 Definition; Agent.
An insurance producer license to act as an agent shall be issued to any eligible person or business entity pursuant to the provisions of RSA 402-J.
Source. 1915, 32:1. 1919, 18:1. PL 275:17. RL 325:18. 2000, 315:10, eff. Jan. 1, 2001.
405:16 Repealed by 2000, 315:26, XII, eff. Jan. 1, 2001.
405:17 Repealed by 2000, 315:26, XIII, eff. Jan. 1, 2001.
405:17-a Repealed by 2000, 315:26, XIV, eff. Jan. 1, 2001.
405:17-b Insuring Through Producers.
I. Foreign insurance or surety companies, although authorized to transact business within this state, shall only make, write, place, or cause to be made, written, or placed, policies or contracts of insurance or suretyship which are to be effective within this state through producers who are licensed and properly appointed to transact business in this state pursuant to RSA 402-J.
II. Foreign insurance or surety companies shall maintain books, records, and documents sufficient to demonstrate compliance with the provisions of paragraph I as provided in RSA 400-B.
Source. 1985, 179:4. 2000, 315:11. 2001, 95:4. 2009, 178:4, eff. Sept. 11, 2009.
405:17-c Insurance Referrals.
Notwithstanding other provisions of this title, a person who has not complied with all applicable state insurance licensing and appointment laws and regulations may refer a party to a person who has complied with all applicable state insurance licensing and appointment laws and regulations, if the person making such referral is compensated for such referral in an amount that does not exceed a nominal amount and such amount is not based on or related to the party's purchase of insurance.
Source. 2000, 313:2, eff. Aug. 20, 2000.
405:18 Repealed by 1981, 4:1, eff. March 6, 1981.
405:19 Repealed by 1981, 4:2, eff. March 6, 1981.
Section 405:20, 405:21
405:20, 405:21 Repealed by 1967, 237:3, eff. Aug. 22, 1967.
405:22 Repealed by 1981, 4:3, eff. March 6, 1981.
405:23 Repealed by 1981, 4:4, eff. March 6, 1981.
Licenses for Agents of Unlicensed Companies
405:24 Applicability; Issue.
I. Foreign unlicensed companies that satisfy the provisions of RSA 405:26 and are approved by the commissioner as unadmitted surplus lines companies are not subject to any statutory or regulatory provision unless the statute or regulation specifically references unadmitted surplus lines companies; provided however, unadmitted surplus lines companies shall be subject to RSA 417:1 through RSA 417:22.
II. (a) Surplus lines insurance may be placed by a surplus lines licensee if the insurer is authorized to write the type of insurance in its domiciliary jurisdiction, and either meets the criteria established through a multi-state agreement pursuant to RSA 405-B:3 or meets one of the following criteria:
(b) The insurer has capital and surplus or its equivalent under the laws of its domiciliary jurisdiction which equals the greater of:
(1) The minimum capital and surplus requirements under RSA 401:4 or RSA 402:13;
(2) Fifteen million dollars; or
(3) The insurer is a nonadmitted insurer domiciled outside the United States that is listed on the Quarterly Listing of Alien Insurers maintained by the International Insurers Department of the National Association of Insurance Commissioners.
III. The commissioner, pursuant to RSA 402-J, may issue a producer license to a resident of the state permitting the producer named therein to procure insurance policies and contracts of insurance or suretyship to be effective in this state in foreign insurance companies not authorized to transact business in this state, but which are duly authorized to do business in some state having an insurance commissioner, or in a domestic insurer authorized to do business in accordance with paragraph IV. Such insurance or suretyship placed with an unadmitted surplus lines company shall be for such amount as the producer cannot place with an admitted company, and shall not be placed until the producer has first satisfied the insurance commissioner that the producer cannot procure such an insurance in an admitted company. For purposes of this paragraph, an insurer authorized to do business in accordance with paragraph IV shall not be deemed to be authorized or admitted. Before delivering to the insured a policy or binder of insurance written under the provisions of this section, every producer shall have stamped in a form approved by the commissioner on the face of the binder or policy the following: "The company issuing this policy is an eligible surplus lines insurer in the state of New Hampshire and the rates charged and policy forms used have not been approved by the commissioner of insurance. If the company issuing this policy becomes insolvent, the New Hampshire insurance guaranty fund shall not be liable for any claims made against the policy."
IV. A domestic insurer possessing policyholder surplus of at least $15,000,000 may, pursuant to a resolution by its board of directors, and with the approval of the commissioner, be designated as a domestic surplus lines insurer. The authority of a domestic surplus lines insurer in this state shall be limited to providing insurance covering risks procured from a surplus lines producer in accordance with this section. A domestic surplus lines insurer is not subject to the provisions of Title XXXVII, except that it shall be subject to any statute or regulation which specifically references unadmitted surplus lines companies and to the provisions of RSA 400-A:37, RSA 400-A:39, RSA 404-F, and RSA 417:1 through 417:31.
Source. 1911, 168:1. PL 275:20. RL 325:25. 1947, 173:1. RSA 405:24. 1959, 206:1. 1969, 366:6. 1983, 473:12. 1986, 59:1. 2000, 315:12. 2001, 95:5. 2008, 255:2. 2011, 191:6, eff. Aug. 13, 2011.
In this subdivision:
I. "Admitted insurer" means an insurer licensed to do an insurance business in this state.
II. "Alien insurer" means an insurance company formed according to the laws of a foreign country.
III. "Capital," as used in the financial requirements of RSA 405:24, means funds paid in for stock or other evidence of ownership.
IV. "Eligible surplus lines insurer" means an unadmitted insurer with which a surplus lines licensee may place surplus lines insurance pursuant to RSA 405:24.
V. "Foreign insurer" means an insurance company selling policies in a state other than the state in which they are incorporated or domiciled.
VI. "Insurer" means any person, corporation, association, partnership, and reciprocal exchange, interinsurer, Lloyds insurer, insurance exchange syndicate, and any other legal entity engaged in the of business of insurance.
VII. "Nonadmitted" or "unadmitted" means an insurer not licensed to do business in this state.
VIII. "Person" means any natural person or other entity, including, but not limited to, individuals, partnerships, associations, trusts, or corporations.
IX. "Policy" or "contract" means any contract of insurance, including but not limited to indemnity, fidelity, or suretyship.
X. "Surplus," as used in the financial requirements of RSA 405:24, means funds over and above liabilities and capital of the company for the protection of policyholders.
XI. "Surplus lines insurance" means property and casualty insurance in this state on properties, risks or exposures, located or performed in this state, permitted to be placed through a surplus lines licensee with an unadmitted insurer eligible to accept such insurance, pursuant to RSA 405:24.
XII. "Surplus lines licensee" means an individual, firm, or corporation licensed under RSA 405:24 to place insurance on properties, risks, or exposures located or to be performed in this state with unadmitted insurers eligible to accept such insurance.
XIII. "Type of insurance" means coverage afforded under the particular policy that is being placed.
Source. 2019, 14:1, eff. July 9, 2019.
405:25 Monthly Statements.
Every such licensee shall, on or before the tenth day of each month, execute and file with the commissioner, a statement under oath covering all insurance policies and contracts of insurance or suretyship procured by him under his said license during the calendar month next preceding, giving the name of the company issuing each of said policies, the name and residence of the insured and the amount, term and premium of each policy and contract and the kind of property or risk insured thereby, and that he was unable to procure in companies admitted to do business in the state the amount of insurance necessary to protect said property or risk.
Source. 1911, 168:2. PL 275:21. RL 325:26. 1947, 173:2, eff. June 4, 1947.
405:26 Companies Excluded.
Such licensee shall not offer any portion of such insurance to any company which has not been approved by the insurance commissioner and does not possess and maintain a surplus to policyholders of at least $500,000 or to any company which has within the preceding 24 months been in an impaired condition.
Source. 1911, 168:2. PL 275:22. RL 325:27. RSA 405:26. 1969, 283:8, eff. June 25, 1969.
405:27 Unlicensed Persons.
No person, unless he shall be so licensed, shall act or aid in any manner in placing policies and contracts of insurance or suretyship to be effective in this state, or other than his own, in any company which is not duly authorized to transact business in this state. No foreign insurance company or other insurer shall issue any policy for which the requirements of this subdivision are not met.
Source. 1911, 168:2. PL 275:23. RL 325:28. 1947, 173:3. RSA 405:27. 1983, 473:13, eff. Sept. 3, 1983.
405:28 Accounts; Reports.
Each person so licensed shall keep a separate account of the business done under the license, a certified copy of which account he shall forthwith file with the commissioner, showing the exact amount of such insurance placed for any person, firm or corporation, the gross premium charged thereon, the companies in which the same is placed, the date of the policies and the term thereof; and he shall also file a report in the same detail of all such policies cancelled and the gross return premium thereon.
Source. 1911, 168:3. PL 275:24. RL 325:29.
405:29 Annual Statement; Tax.
I. Each licensed producer shall file with the commissioner, not later than January 31st of each year, a sworn statement of the gross premiums charged for insurance procured or placed and the gross return premiums on such insurance cancelled under such license during the year ending on December 31 next preceding, and at the time of filing such statement shall pay to the state treasurer a sum equal to 3 percent of such gross premiums less such return premiums reported.
II. Any producer failing to file the report or failing to remit the proper tax within the time period for filing shall pay a penalty contingent upon the number of days that have passed since the due date. For late payments received 1-30 days after the due date, the penalty fee shall be 3 percent of the amount of tax due. For late payments received 31-60 days after the due date, the penalty fee shall be 6 percent of the amount of tax due. For late payments received more than 60 days after the due date, the penalty fee shall be 12 percent of the amount of tax due.
III. Each producer filing under this section shall be subject to the provisions of RSA 400-A:32-a.
Source. 1911, 168:4. PL 275:25. RL 325:30. 2008, 154:2. 2010, 13:4, eff. July 1, 2010. 2019, 179:3, eff. Jan. 1, 2020.
405:29-a Annual Statement; Tax; Insurance Transactions on Multi-State Risks.
For each licensed producer of unlicensed surplus lines companies reporting multi-state transactions, the provisions of RSA 405-B shall apply.
Source. 2011, 191:1, eff. Aug. 13, 2011.
The commissioner shall have authority at all times to investigate any alleged violations of this subdivision, and should he find any to exist he shall report the same to the attorney-general, who shall take proceedings to collect all fees and taxes which may be due from said licensee.
Source. 1911, 168:5. PL 275:26. RL 325:31.
Any person who violates or fails to comply with any of the provisions of this subdivision shall be subject to a fine not more than $2,500 or have any license suspended or revoked or shall both be fined and have any license suspended or revoked.
Source. 1911, 168:5. PL 275:27. RL 325:32. RSA 405:31. 1973, 530:55. 1983, 473:14, eff. Sept. 3, 1983.
405:32 Repealed by 2000, 315:26, XV, eff. Jan. 1, 2001.
405:33 Repealed by 2000, 315:26, XVI, eff. Jan. 1, 2001.
405:34 Brokers; Producer License.
An insurance producer license to act as a broker shall be issued to any eligible person or business entity pursuant to the provisions of RSA 402-J.
Source. 1915, 63:4. 1917, 23:1. PL 275:29. RL 325:35. 2000, 315:13, eff. Jan. 1, 2001.
405:35 Repealed by 2000, 315:26, XVII, eff. Jan. 1, 2001.
405:36 Repealed by 2000, 315:26, XVIII, eff. Jan. 1, 2001.
405:37 Repealed by 2000, 315:26, XIX, eff. Jan. 1, 2001.
405:37-a Repealed by 2000, 315:26, XX, eff. Jan. 1, 2001.
405:38 Repealed by 1963, 310:2, eff. Sept. 1, 1963.
405:39 Repealed by 2000, 315:26, XXI, eff. Jan. 1, 2001.
405:40 Repealed by 2000, 315:26, XXII, eff. Jan. 1, 2001.
405:41 Repealed by 2000, 315:26, XXIII, eff. Jan. 1, 2001.
405:42 Repealed by 2000, 315:26, XXIV, eff. Jan. 1, 2001.
405:43 Effect of Broker's Knowledge.
Companies issuing policies through their agents on applications from brokers shall be charged with the broker's knowledge of facts to the same extent as if he were their agent.
Source. 1915, 63:3. PL 275:38. RL 325:43.
405:44 Repealed by 2000, 315:26, XXV, eff. Jan. 1, 2001.
405:44-a Consultants; Producer; License Required.
I. No person, corporation, partnership or association shall engage in any of the following acts without holding a valid producer license pursuant to RSA 402-J and complying with the provisions of RSA 405:44-a through RSA 405:44-g:
(a) Place on any advertisements, cards, signs, circulars or letterheads, or elsewhere, or in any other way or manner by which public announcements are made, use the title "insurance consultant," "insurance adviser," "insurance specialist," "insurance counselor," "insurance analyst," "policyholders' advisor," "policyholders' counselor," or any other similar title, or any title, word or combination of words indicating that the person, corporation, partnership or association gives, or is engaged in the business of giving, advice, counsel, recommendation or information to holders of policies of insurance or annuity or pure endowment contracts; or
(b) For a fee received or to be received, offer to examine, or examine or aid in examining, any policy of insurance for any annuity or pure endowment contract for the purpose of giving, or give or offer to give, any advice, counsel, recommendation or information in respect to the terms, conditions, benefits, coverage or premium of any such policy or contract, or in respect to the expediency or advisability of altering, changing, exchanging, converting, replacing, surrendering, continuing, renewing or rejecting any such policy or contract, or of accepting or procuring any such policy or contract from any company.
II. The term "fee" as used in this section means compensation paid by a person served by any person required to be licensed under RSA 402-J. Fee shall not be construed to mean the commission paid to a licensed insurance producer by an insurer.
Source. 1986, 58:1. 2000, 315:14. 2001, 95:3. 2008, 212:2, eff. June 16, 2008.
405:44-b Consultants; Application for License; Standards; Fee; Revocation; Suspension; Hearing.
I. The commissioner may, upon receipt of a fee pursuant to RSA 400-A:29, issue to any person who has attained the age of 18 or to any corporation, partnership or association a producer's license to act as an insurance consultant. The applicant for the license shall apply for such license pursuant to the provisions of RSA 402-J.
II, III. [Repealed.]
IV. The commissioner may at any time, for cause shown and after a hearing, due notice of which has been given, revoke the license or suspend it for a period not exceeding the unexpired term of the license. The commissioner may, for cause shown and after a hearing, due notice of which has been given, revoke the license while so suspended, and shall notify the licensee in writing of such revocation or suspension, and shall publish a notice of such revocation or suspension in such manner as he may deem necessary for the protection of the public.
V. The commissioner may at any time require such information as he deems necessary as to the business methods, policies and transactions of a licensee under this section. Any person, corporation, partnership or association who fails or refuses to furnish the commissioner, in such form as he may require, any such information within 10 days after receiving a written request therefor shall be subject to suspension or revocation of his license or an administrative fine of not more than $2,500, or both a fine and suspension or revocation.
Source. 1986, 58:1. 2000, 315:15, 26, XXVI. 2008, 18:15, eff. July 11, 2008.
Any person, corporation, partnership or association aggrieved by the action of the commissioner in revoking, suspending or refusing to grant or reissue a license may file an appeal in accordance with the provisions of RSA 541.
Source. 1986, 58:1, eff. July 1, 1986.
405:44-d Unenforceable Contracts or Agreements.
Any contract or agreement with an insurance consultant shall not be enforceable by him unless it is in writing and executed, in duplicate, by the person to be charged or by his legal representative, or unless one of such duplicates is delivered to, or retained by, such person when it is signed by him, or unless it plainly specifies the amount of the fee paid or payable by such person and the services to be rendered by such insurance consultant, or unless it is in a form currently approved by the commissioner.
Source. 1986, 58:1, eff. July 1, 1986.
405:44-e Required Acknowledgments.
An insurance consultant who furnishes any advice or counsel as such consultant, makes any recommendation or gives any information except under the terms of a previously executed written contract conforming to RSA 405:44-d and in full force and effect shall, in every case, give to the recipient a statement in writing, signed by him, in a form currently approved by the commissioner, specifying the advice, counsel, recommendation or information given, and a receipt, in a form currently approved by the commissioner, for the fee paid to him or a statement, in a form currently approved by the commissioner, of the fee to be received by him. Any person, corporation, partnership or association who violates any provision of this section shall be subject to suspension or revocation of his or its license or an administrative fine of not more than $2,500, or both a fine and suspension or revocation.
Source. 1986, 58:1, eff. July 1, 1986.
405:44-f Disclosure Statement.
I. In addition to those records and reports which the commissioner may require pursuant to title XXXVII, any person, corporation, partnership or association subject to the provisions of this subdivision shall provide to current and prospective clients a written disclosure statement containing information relative to his or its background and business practices. The written disclosure statement shall include information concerning all of the following:
(a) The types of clients serviced by the insurance consultant.
(b) The nature and cost of services provided.
(c) The methods of analysis, sources of information and investment strategies utilized.
(d) The educational background of the insurance consultant and his employees or associates and the business standards to which he adheres.
(e) Any other business activities or professions in which the insurance consultant is engaged.
(f) Any ownership interest the insurance consultant may have in entities offering products which may be recommended by the insurance consultant.
(g) Whether there are any sales fees and commissions which the insurance consultant may receive for recommending particular insurance products to clients.
(h) Any other information relative to the insurance consultant's background and business practices which the commissioner deems appropriate.
II. The written disclosure statement shall be delivered to clients or prospective clients not less than 48 hours prior to the establishment of a written contract, or at the time the parties enter into the contract, if the client is afforded the right to terminate the contract, without penalty, within 5 business days after entering into it.
Source. 1986, 58:1, eff. July 1, 1986.
405:44-g Penalty for Acting Without a License.
Any person, corporation, partnership, or association who acts as an insurance consultant without such license or during a suspension of his or its license shall be subject to an administrative fine not to exceed $2,500 for each such act.
Source. 1986, 58:1, eff. July 1, 1986.
The purpose of this subdivision is to protect the interest of insureds, claimants, ceding insurers, assuming insurers, and the public generally. The general court hereby declares its intent is to ensure adequate regulation of insurers and reinsurers and adequate protection for those to whom they owe obligations. In furtherance of that state interest, the general court hereby provides a mandate that upon the insolvency of a non-U.S. insurer or reinsurer that provides security to fund its United States obligations in accordance with this subdivision, the assets representing the security shall be maintained in the United States and claims shall be filed with and valued by the state insurance commissioner with regulatory oversight, and the assets shall be distributed, in accordance with the insurance laws of the state in which the trust is domiciled that are applicable to the liquidation of domestic United States insurance companies. The general court declares that the matters contained in this subdivision are fundamental to the business of insurance in accordance with 15 U.S.C. sections 1011-1012.
Source. 2004, 186:1. 2013, 235:1, eff. Sept. 13, 2013.
In this subdivision:
I. "NAIC" means the National Association of Insurance Commissioners.
II. A "qualified U.S. financial institution" means an institution that:
(a) Is organized or, in the case of a U.S. office of a foreign banking organization, licensed, under the laws of the United States or any state thereof;
(b) Is regulated, supervised, and examined by U.S. federal or state authorities having regulatory authority over banks and trust companies; and
(c) Has been determined by either the commissioner or the Securities Valuation Office of the National Association of Insurance Commissioners to meet such standards of financial condition and standing as are considered necessary and appropriate to regulate the quality of financial institutions whose letters of credit will be acceptable to the commissioner.
III. A "qualified U.S. financial institution" means, for purposes of those provisions of this subdivision specifying those institutions that are eligible to act as a fiduciary of a trust, an institution that:
(a) Is organized, or, in the case of a U.S. branch or agency office of a foreign banking organization, licensed, under the laws of the United States or any state thereof and has been granted authority to operate with fiduciary powers; and
(b) Is regulated, supervised, and examined by federal or state authorities having regulatory authority over banks and trust companies.
Source. 2004, 186:1. 2013, 235:2, eff. Sept. 13, 2013.
405:47 Credit Allowed a Domestic Ceding Insurer.
Credit for reinsurance shall be allowed a domestic ceding insurer as either an asset or a reduction from liability on account of reinsurance ceded only when the reinsurer meets the requirements of paragraphs I, II, III, IV, or V; provided that the commissioner may adopt by rule, pursuant to RSA 541-A, specific additional requirements relating to or setting forth the valuation of assets or reserve credits, the amount and forms of security supporting reinsurance arrangements described in RSA 405:51, and the circumstances pursuant to which credit shall be reduced or eliminated. Credit shall be allowed under paragraphs I, II, or III only as respects cessions of those kinds or classes of business which the assuming insurer is licensed or otherwise permitted to write or assume in its state of domicile or, in the case of a U.S. branch of an alien assuming insurer, in the state through which it is entered and licensed to transact insurance or reinsurance. Credit shall be allowed under paragraphs III or IV only if the applicable requirements of paragraph VI have been satisfied.
I. Credit shall be allowed when the reinsurance is ceded to an assuming insurer that is licensed to transact insurance or reinsurance in this state.
II. Credit shall be allowed when the reinsurance is ceded to an assuming insurer that is accredited by the commissioner as a reinsurer in this state. To be eligible for accreditation a reinsurer shall:
(a) File with the commissioner evidence of its submission to this state's jurisdiction.
(b) Submit to this state's authority to examine its books and records.
(c) Be licensed to transact insurance or reinsurance in at least one state, or, in the case of a U.S. branch of an alien assuming insurer, is entered through and licensed to transact insurance or reinsurance in at least one state.
(d) File annually with the commissioner a copy of its annual statement filed with the insurance department of its state of domicile and a copy of its most recent audited financial statement.
(e) Demonstrate to the satisfaction of the commissioner that it has adequate financial capacity to meet its reinsurance obligations and is otherwise qualified to assume reinsurance from domestic insurers. An assuming insurer is deemed to meet the requirements as of the time of its application if it maintains a surplus as regards policyholders in an amount not less than $20,000,000 and its accreditation has not been denied by the commissioner within 90 days after submission of its application.
III. (a) Credit shall be allowed when the reinsurance is ceded to an assuming insurer that is domiciled in, or, in the case of a U.S. branch of an alien assuming insurer, is entered through, a state that employs standards regarding credit for reinsurance substantially similar to those applicable under this subdivision and the assuming insurer or U.S. branch of an alien assuming insurer:
(1) Maintains a surplus as regards policyholders in an amount not less than $20,000,000; and
(2) Submits to the authority of this state to examine its books and records.
(b) Subparagraph (a)(1) does not apply to reinsurance ceded and assumed pursuant to pooling arrangements among insurers in the same holding company system.
IV. (a) Credit shall be allowed when the reinsurance is ceded to an assuming insurer that maintains a trust fund in a qualified United States financial institution, as defined in RSA 405:46 for the payment of the valid claims of its United States ceding insurers, their assigns and successors in interest. To enable the commissioner to determine the sufficiency of the trust fund, the assuming insurer shall report annually to the commissioner information substantially the same as that required to be reported on the NAIC Annual Statement form by licensed insurers. The assuming insurer shall submit to examination of its books and records by the commissioner and bear the expense of examination.
(b)(1) Credit for reinsurance shall not be granted under this section unless the form of the trust and any amendments to the trust have been approved by:
(A) The commissioner of the state where the trust is domiciled; or
(B) The commissioner of another state who, pursuant to the terms of the trust instrument, has accepted principal regulatory oversight of the trust.
(2) The form of the trust and any trust amendments also shall be filed with the commissioner of every state in which the ceding insurer beneficiaries of the trust are domiciled. The trust instrument shall provide that contested claims shall be valid and enforceable upon the final order of any court of competent jurisdiction of the United States. The trust shall vest legal title to its assets in its trustees for the benefit of the assuming insurer's U.S. ceding insurers, their assigns and successors in interest. The trust and the assuming insurer shall be subject to examination as determined by the commissioner.
(3) The trust shall remain in effect for as long as the assuming insurer has outstanding obligations due under the reinsurance agreements subject to the trust. No later than February 28 of each year, the trustee of the trust shall report to the commissioner in writing the balance of the trust and listing the trust's investments at the preceding year end and shall certify the date of termination of the trust, if so planned, or certify that the trust will not expire prior to the following December 31.
(c) The following requirements apply to the following categories of assuming insurers:
(1) The trust fund for a single assuming insurer shall consist of funds in trust in an amount not less than the assuming insurer's liabilities attributable to reinsurance ceded by U.S. ceding insurers, and, in addition, the assuming insurer shall maintain a trusteed surplus of not less than $20,000,000, except as provided in subparagraph (2).
(2) At any time after the assuming insurer has permanently discontinued underwriting new business secured by the trust for at least 3 full years, the commissioner with principal regulatory oversight of the trust may authorize a reduction in the required trusteed surplus, but only after a finding, based on an assessment of the risk, that the new required surplus level is adequate for the protection of U.S. ceding insurers, policyholders and claimants in light of reasonably foreseeable adverse loss development. The risk assessment may involve an actuarial review, including an independent analysis of reserves and cash flows, and shall consider all material risk factors, including when applicable the lines of business involved, the stability of the incurred loss estimates and the effect of the surplus requirements on the assuming insurer's liquidity or solvency. The minimum required trusteed surplus shall not be reduced to an amount less than 30 percent of the assuming insurer's liabilities attributable to reinsurance ceded by U.S. ceding insurers covered by the trust.
(3) In the case of a group including incorporated and individual unincorporated underwriters:
(A) For reinsurance ceded under reinsurance agreements with an inception, amendment, or renewal date on or after August 1, 1995, the trust shall consist of a trusteed account in an amount not less than the respective underwriters' several liabilities attributable to business ceded by U.S. domiciled ceding insurers to any underwriter of the group;
(B) For reinsurance ceded under reinsurance agreements with an inception date on or before July 31, 1995, and not amended or renewed after that date, notwithstanding the other provisions of this chapter, the trust shall consist of a trusteed account in an amount not less than the respective underwriters' several insurance and reinsurance liabilities attributable to business written in the United States; and
(C) In addition to these trusts, the group shall maintain in trust a trusteed surplus of which $100,000,000 shall be held jointly for the benefit of the U.S. domiciled ceding insurers of any member of the group for all years of account; and
(4) The incorporated members of the group shall not be engaged in any business other than underwriting as a member of the group and shall be subject to the same level of regulation and solvency control by the group's domiciliary regulator as are the unincorporated members.
(5) Within 90 days after its financial statements are due to be filed with the group's domiciliary regulator, the group shall provide to the commissioner an annual certification by the group's domiciliary regulator of the solvency of each underwriter member; or if a certification is unavailable, financial statements, prepared by independent public accountants, of each underwriter member of the group.
(d) In the case of a group of incorporated underwriters under common administration, the group shall:
(1) Have continuously transacted an insurance business outside the United States for at least 3 years immediately prior to making application for accreditation;
(2) Maintain aggregate policyholders' surplus of at least $10,000,000,000;
(3) Maintain a trust fund in an amount not less than the group's several liabilities attributable to business ceded by U.S. domiciled ceding insurers to any member of the group pursuant to reinsurance contracts issued in the name of the group;
(4) In addition, maintain a joint trusteed surplus of which $100,000,000 shall be held jointly for the benefit of U.S. domiciled ceding insurers of any member of the group as additional security for these liabilities; and
(5) Within 90 days after its financial statements are due to be filed with the group's domiciliary regulator, make available to the commissioner an annual certification of each underwriter member's solvency by the member's domiciliary regulator and financial statements of each underwriter member of the group prepared by its independent public accountant.
IV-a. Credit shall be allowed when the reinsurance is ceded to an assuming insurer that has been certified by the commissioner as a reinsurer in this state and secures its obligations in accordance with the requirements of this paragraph.
(a) To be eligible for certification, the assuming insurer shall meet the following requirements:
(1) Be domiciled and licensed to transact insurance or reinsurance in a qualified jurisdiction, as determined by the commissioner pursuant to subparagraph (c);
(2) Maintain minimum capital and surplus, or its equivalent, in an amount to be determined by the commissioner pursuant to rule;
(3) Maintain financial strength ratings from 2 or more rating agencies deemed acceptable to the commissioner pursuant to rule;
(4) Agree to submit to the jurisdiction of this state, appoint the commissioner as its agent for service of process in this state, and agree to provide security for 100 percent of the assuming insurer's liabilities attributable to reinsurance ceded by U.S. ceding insurers if it resists enforcement of a final U.S. judgment;
(5) Agree to meet applicable information filing requirements as determined by the commissioner, both with respect to an initial application for certification and on an ongoing basis; and
(6) Satisfy any other requirements for certification deemed relevant by the commissioner.
(b) An association including incorporated and individual unincorporated underwriters may be a certified reinsurer. To be eligible for certification, in addition to satisfying the requirements of subparagraph (a):
(1) The association shall satisfy its minimum capital and surplus requirements through the capital and surplus equivalents (net of liabilities) of the association and its members, which shall include a joint central fund that may be applied to any unsatisfied obligation of the association or any of its members, in an amount determined by the commissioner to provide adequate protection.
(2) The incorporated members of the association shall not be engaged in any business other than underwriting as a member of the association and shall be subject to the same level of regulation and solvency control by the association's domiciliary regulator as are the unincorporated members; and
(3) Within 90 days after its financial statements are due to be filed with the association's domiciliary regulator, the association shall provide to the commissioner an annual certification by the association's domiciliary regulator of the solvency of each underwriter member; or if a certification is unavailable, financial statements, prepared by independent public accountants, of each underwriter member of the association.
(c) The commissioner shall create and publish a list of qualified jurisdictions, under which an assuming insurer licensed and domiciled in such jurisdiction is eligible to be considered for certification by the commissioner as a certified reinsurer.
(1) To determine whether the domiciliary jurisdiction of a non-U.S. assuming insurer is eligible to be recognized as a qualified jurisdiction, the commissioner shall evaluate the appropriateness and effectiveness of the reinsurance supervisory system of the jurisdiction, both initially and on an ongoing basis, and consider the rights, benefits and the extent of reciprocal recognition afforded by the non-U.S. jurisdiction to reinsurers licensed and domiciled in the U.S. A qualified jurisdiction shall agree to share information and cooperate with the commissioner with respect to all certified reinsurance domiciled within that jurisdiction. A jurisdiction shall not be recognized as a qualified jurisdiction if the commissioner has determined that the jurisdiction does not adequately and promptly enforce final U.S. judgments and arbitration awards. Additional factors may be considered in the discretion of the commissioner.
(2) A list of qualified jurisdictions shall be published through the NAIC committee process. The commissioner shall consider this list in determining qualified jurisdictions. If the commissioner approves a jurisdiction as qualified that does not appear on the list of qualified jurisdictions, the commissioner shall provide thoroughly documented justification in accordance with criteria to be developed under regulation.
(3) U.S. jurisdictions that meet the requirement for accreditation under the NAIC financial standards and accreditation program shall be recognized as qualified jurisdictions.
(4) If a certified reinsurer's domiciliary jurisdiction ceases to be a qualified jurisdiction, the commissioner has the discretion to suspend the reinsurer's certification indefinitely, in lieu of revocation.
(d) The commissioner shall assign a rating to each certified reinsurer, giving due consideration to the financial strength ratings that have been assigned by rating agencies deemed acceptable to the commissioner pursuant to rule. The commissioner shall publish a list of all certified reinsurers and their ratings.
(e) A certified reinsurer shall secure obligations assumed from U.S. ceding insurers under this subparagraph at a level consistent with its rating, as specified in rules accepted by the commissioner.
(1) In order for a domestic ceding insurer to qualify for full financial statement credit for reinsurance ceded to a certified reinsurer, the certified reinsurer shall maintain security in a form acceptable to the commissioner and consistent with the provisions of RSA 405:50, or in a multi-beneficiary trust in accordance with RSA 405:47, IV, except as otherwise provided in this subparagraph.
(2) If a certified reinsurer maintains a trust to fully secure its obligations subject to RSA 405:47, IV, and chooses to secure its obligations incurred as a certified reinsurer in the form of a multi-beneficiary trust, the certified reinsurer shall maintain separate trust accounts for its obligations incurred under reinsurance agreements issued or renewed as a certified reinsurer with reduced security as permitted by this subparagraph or comparable laws of other U.S. jurisdictions and for its obligations subject to RSA 405:47, IV. It shall be a condition to the grant of certification under RSA 405:47, IV-a that the certified reinsurer shall have bound itself, by the language of the trust and agreement with the commissioner with principal regulatory oversight of each such trust account, to fund, upon termination of any such trust account, out of the remaining surplus of such trust any deficiency of any other such trust account.
(3) The minimum trusteed surplus requirements provided in RSA 405:47, IV are not applicable with respect to a multi-beneficiary trust maintained by a certified reinsurer for the purpose of securing obligations incurred under this paragraph, except that such trust shall maintain a minimum trusteed surplus of $10,000,000.
(4) With respect to obligations incurred by a certified reinsurer under this subparagraph, if the security is insufficient, the commissioner shall reduce the allowable credit by an amount proportionate to the deficiency, and has the discretion to impose further reductions in allowable credit upon finding that there is a material risk that the certified reinsurer's obligations will not be paid in full when due.
(5) For purposes of this subparagraph, a certified reinsurer whose certification has been terminated for any reason shall be treated as a certified reinsurer required to secure 100 percent of its obligations.
(A) In this subparagraph, "terminated" means revocation, suspension, voluntary surrender and inactive status.
(B) If the commissioner continues to assign a higher rating as permitted by other provisions of this section, this requirement does not apply to a certified reinsurer in inactive status or to a reinsurer whose certification has been suspended.
(f) If an applicant for certification has been certified as a reinsurer in an NAIC accredited jurisdiction, the commissioner has the discretion to defer to that jurisdiction's certification, and has the discretion to defer to the rating assigned by that jurisdiction, and such assuming insurer shall be considered to be a certified reinsurer in this state.
(g) A certified reinsurer that ceases to assume new business in this state may request to maintain its certification in inactive status in order to continue to qualify for a reduction in security for its in-force business. An inactive certified reinsurer shall continue to comply with all applicable requirements of this paragraph, and the commissioner shall assign a rating that takes into account, if relevant, the reasons why the reinsurer is not assuming new business.
IV-b. (a) Credit shall be allowed when the reinsurance is ceded to an assuming insurer meeting each of the conditions set forth in this paragraph.
(1) The assuming insurer must have its head office or be domiciled in, as applicable, and be licensed in a reciprocal jurisdiction. A "reciprocal jurisdiction" is a jurisdiction that meets one of the following:
(A) A non-U.S. jurisdiction that is subject to an in-force covered agreement with the United States, each within its legal authority, or, in the case of a covered agreement between the United States and European Union, is a member state of the European Union. For purposes of this subparagraph, a "covered agreement" is an agreement entered into pursuant to Dodd-Frank Wall Street Reform and Consumer Protection Act, 31 U.S.C. sections 313 and 314, that is currently in effect or in a period of provisional application and addresses the elimination, under specified conditions, of collateral requirements as a condition for entering into any reinsurance agreement with a ceding insurer domiciled in this state or for allowing the ceding insurer to recognize credit for reinsurance;
(B) A U.S. jurisdiction that meets the requirements for accreditation under the NAIC financial standards and accreditation program; or
(C) A qualified jurisdiction, as determined by the commissioner pursuant to RSA 405:47, IV-a(c), which is not otherwise described in subparagraph (A) or (B) and which meets certain additional requirements, consistent with the terms and conditions of in-force covered agreements, as specified by the commissioner in rules.
(2) The assuming insurer must have and maintain, on an ongoing basis, minimum capital and surplus, or its equivalent, calculated according to the methodology of its domiciliary jurisdiction, in an amount to be set forth in rules. If the assuming insurer is an association, including incorporated and individual unincorporated underwriters, it must have and maintain, on an ongoing basis, minimum capital and surplus equivalents (net of liabilities), calculated according to the methodology applicable in its domiciliary jurisdiction, and a central fund containing a balance in amounts to be set forth in rules.
(3) The assuming insurer must have and maintain, on an ongoing basis, a minimum solvency or capital ratio, as applicable, which will be set forth in rules. If the assuming insurer is an association, including incorporated and individual unincorporated underwriters, it must have and maintain, on an ongoing basis, a minimum solvency or capital ratio in the reciprocal jurisdiction where the assuming insurer has its head office or is domiciled, as applicable, and is also licensed.
(4) The assuming insurer must agree and provide adequate assurance to the commissioner, in a form specified by the commissioner pursuant to rules, as follows:
(A) The assuming insurer must provide prompt written notice and explanation to the commissioner if it falls below the minimum requirements set forth in subparagraphs (a)(2) or (3), or if any regulatory action is taken against it for serious noncompliance with applicable law;
(B) The assuming insurer must consent in writing to the jurisdiction of the courts of this state and to the appointment of the commissioner as agent for service of process. The commissioner may require that consent for service of process be provided to the commissioner and included in each reinsurance agreement. Nothing in this provision shall limit, or in any way alter, the capacity of parties to a reinsurance agreement to agree to alternative dispute resolution mechanisms, except to the extent such agreements are unenforceable under applicable insolvency or delinquency laws;
(C) The assuming insurer must consent in writing to pay all final judgments, wherever enforcement is sought, obtained by a ceding insurer or its legal successor, that have been declared enforceable in the jurisdiction where the judgment was obtained;
(D) Each reinsurance agreement must include a provision requiring the assuming insurer to provide security in an amount equal to 100 percent of the assuming insurer's liabilities attributable to reinsurance ceded pursuant to that agreement if the assuming insurer resists enforcement of a final judgment that is enforceable under the law of the jurisdiction in which it was obtained or a properly enforceable arbitration award, whether obtained by the ceding insurer or by its legal successor on behalf of its resolution estate; and
(E) The assuming insurer must confirm that it is not presently participating in any solvent scheme of arrangement which involves this state's ceding insurers, and agree to notify the ceding insurer and the commissioner and to provide security in an amount equal to 100 percent of the assuming insurer's liabilities to the ceding insurer, should the assuming insurer enter into such a solvent scheme of arrangement. Such security shall be in a form consistent with the provisions of paragraph IV-a and RSA 405:50 and as specified by the commissioner in rules.
(5) The assuming insurer or its legal successor must provide, if requested by the commissioner, on behalf of itself and any legal predecessors, certain documentation to the commissioner, as specified by the commissioner in rules.
(6) The assuming insurer must maintain a practice of prompt payment of claims under reinsurance agreements, pursuant to criteria set forth in rules.
(7) The assuming insurer's supervisory authority must confirm to the commissioner on an annual basis, as of the preceding December 31 or at the annual date otherwise statutorily reported to the reciprocal jurisdiction, that the assuming insurer complies with the requirements set forth in subparagraphs (a)(2) and (3).
(8) Nothing in this paragraph precludes an assuming insurer from providing the commissioner with information on a voluntary basis.
(b) The commissioner shall timely create and publish a list of reciprocal jurisdictions.
(1) A list of reciprocal jurisdictions is published through the NAIC committee process. The commissioner's list shall include any reciprocal jurisdiction as defined under subparagraphs (a)(1)(A) and (B), and shall consider any other reciprocal jurisdiction included on the NAIC list. The commissioner may approve a jurisdiction that does not appear on the NAIC list of reciprocal jurisdictions in accordance with criteria to be developed under rules adopted by the commissioner.
(2) The commissioner may remove a jurisdiction from the list of reciprocal jurisdictions upon a determination that the jurisdiction no longer meets the requirements of a reciprocal jurisdiction, in accordance with a process set forth in rules adopted by the commissioner, except that the commissioner shall not remove from the list a reciprocal jurisdiction as defined under subparagraph (a)(1)(A) and (B). Upon removal of a reciprocal jurisdiction from this list credit for reinsurance ceded to an assuming insurer which has its home office or is domiciled in that jurisdiction shall be allowed, if otherwise allowed pursuant to RSA 405:47.
(c) The commissioner shall timely create and publish a list of assuming insurers that have satisfied the conditions set forth in this paragraph and to which cessions shall be granted credit in accordance with this subparagraph. The commissioner may add an assuming insurer to such list if an NAIC accredited jurisdiction has added such assuming insurer to a list of such assuming insurers or if, upon initial eligibility, the assuming insurer submits the information to the commissioner as required under subparagraph (a)(4) and complies with any additional requirements that the commissioner may impose by rules, except to the extent that they conflict with an applicable covered agreement.
(d) If the commissioner determines that an assuming insurer no longer meets one or more of the requirements under this subparagraph, the commissioner may revoke or suspend the eligibility of the assuming insurer for recognition under this subparagraph in accordance with procedures set forth in rules.
(1) While an assuming insurer's eligibility is suspended, no reinsurance agreement issued, amended or renewed after the effective date of the suspension qualifies for credit except to the extent that the assuming insurer's obligations under the contract are secured in accordance with RSA 405:50.
(2) If an assuming insurer's eligibility is revoked, no credit for reinsurance may be granted after the effective date of the revocation with respect to any reinsurance agreements entered into by the assuming insurer, including reinsurance agreements entered into prior to the date of revocation, except to the extent that the assuming insurer's obligations under the contract are secured in a form acceptable to the commissioner and consistent with the provisions of RSA 405:50.
(e) If subject to a legal process of rehabilitation, liquidation, or conservation, as applicable, the ceding insurer, or its representative, may seek and, if determined appropriate by the court in which the proceedings are pending, may obtain an order requiring that the assuming insurer post security for all outstanding ceded liabilities.
(f) Nothing in this paragraph shall limit or in any way alter the capacity of parties to a reinsurance agreement to agree on requirements for security or other terms in that reinsurance agreement, except as expressly prohibited by this section or other applicable law or rules.
(g) Credit may be taken under this subparagraph only for reinsurance agreements entered into, amended, or renewed on or after the effective date of this paragraph, and only with respect to losses incurred and reserves reported on or after the later of (1) the date on which the assuming insurer has met all eligibility requirements pursuant to subparagraph (a), and (2) the effective date of the new reinsurance agreement, amendment, or renewal.
(1) This paragraph does not alter or impair a ceding insurer's right to take credit for reinsurance, to the extent that credit is not available under this paragraph, as long as the reinsurance qualifies for credit under any other applicable provision of this section.
(2) Nothing in this paragraph shall authorize an assuming insurer to withdraw or reduce the security provided under any reinsurance agreement except as permitted by the terms of the agreement.
(3) Nothing in this paragraph shall limit, or in any way alter, the capacity of parties to any reinsurance agreement to renegotiate the agreement.
V. Credit shall be allowed when the reinsurance is ceded to an assuming insurer not meeting the requirements of paragraphs I, II, III IV, IV-a, or IV-b but only with respect to the insurance of risks located in the jurisdictions where the reinsurance is required by applicable law or regulation of that jurisdiction.
VI. If the assuming insurer is not licensed, accredited, or certified to transact insurance or reinsurance in this state, the credit permitted by paragraphs III and IV shall not be allowed unless the assuming insurer agrees in the reinsurance agreements:
(a) That in the event of the failure of the assuming insurer to perform its obligations under the terms of the reinsurance agreement, the assuming insurer, at the request of the ceding insurer:
(1) Shall submit to the jurisdiction of any court of competent jurisdiction in any state of the United States;
(2) Shall comply with all requirements necessary to give such court jurisdiction; and
(3) Shall abide by the final decision of such court or of any appellate court in the event of an appeal.
(b) To designate the commissioner or a designated attorney as its true and lawful attorney upon whom may be served any lawful process in any action, suit or proceeding instituted by or on behalf of the ceding insurer.
(c) This paragraph is not intended to conflict with or override the obligation of the parties to a reinsurance agreement to arbitrate their disputes, if this obligation is created in the agreement.
VII. (a) No credit under this section shall be allowed, as an admitted asset or deduction from liability, to any ceding insurer for reinsurance, unless the reinsurance contract provides, in substance, that in the event of the insolvency of the ceding insurer, the reinsurance shall be payable by the assuming insurer on the basis of the claims allowed against the ceding insurer in the insolvency proceedings, under contract or contracts reinsured, without diminution because of the insolvency of the ceding insurer directly to the ceding insurer or to its domiciliary liquidator or receiver except:
(1) Where the contract specifically provides another payee of such reinsurance in the event of the insolvency of the ceding insurer; or
(2) Where the assuming insurer with the consent of the direct insured or insured has assumed such policy obligations of the ceding insurer as direct obligations of the assuming insurer to the payees under such policies and in substitution for the obligations of the ceding insurer to such payees.
(b) A reinsurance contract may provide that the domiciliary liquidator or receiver of any insolvent ceding insurer shall, within a specified or reasonable time after the claim is filed in court or in the receivership, give written notice to the assuming insurer of all or part of any claims against the ceding insurer on the policy or bond reinsured. During the pendency of the claim, any assuming insurer may investigate the claim and, unless forbidden to do so by the reinsurance agreement, may intervene in the proceeding in which the claim is pending and interpose any defenses it considers available which have not been raised by the ceding insurer, its liquidator, or receiver. The expenses incurred by the assuming insurer in this type of action are payable up to the amount of the expenses or the amount of the benefit produced, whichever is less, as expenses of the receivership. If 2 or more assuming insurers have potential liability because of the same claim, the expenses shall be apportioned among them in proportion to the benefit received.
Source. 2004, 186:1. 2013, 235:3. 2016, 144:1, eff. July 26, 2016. 2018, 193:1, eff. Aug. 7, 2018. 2020, 37:36, 37, eff. Sept. 27, 2020.
405:48 Nonlicensed or Accredited Insurer.
If the assuming insurer does not meet the requirements of RSA 405:47, I-III, the credit permitted by RSA 405:47, IV and IV-a shall not be allowed unless the assuming insurer agrees in the trust agreements to the following conditions:
I. Notwithstanding any other provisions in the trust instrument, if the trust fund is inadequate because it contains an amount less than the amount required by RSA 405:47, IV(c), or if the grantor of the trust has been declared insolvent or placed into receivership, rehabilitation, liquidation or similar proceedings under the laws of its state or country of domicile, the trustee shall comply with an order of the commissioner with regulatory oversight over the trust or with an order of a court of competent jurisdiction directing the trustee to transfer to the commissioner with regulatory oversight all of the assets of the trust fund.
II. The assets shall be distributed by and claims shall be filed with and valued by the commissioner with regulatory oversight over the trust in accordance with the laws of the state in which the trust is domiciled that are applicable to the liquidation of domestic insurance companies.
III. If the commissioner with regulatory oversight determines that the assets of the trust fund or any part thereof are not necessary to satisfy the claims of the U.S. ceding insurers of the grantor of the trust, the assets or part thereof shall be returned by the commissioner with regulatory oversight to the trustee for distribution in accordance with the trust agreement.
IV. The grantor shall waive any right otherwise available to it under U.S. law that is inconsistent with this provision.
Source. 2004, 186:1. 2013, 235:4, 5, eff. Sept. 13, 2013.
405:49 Suspension; Concentration Risk.
I. If an accredited or certified reinsurer ceases to meet the requirements for accreditation or certification, the commissioner may suspend or revoke the reinsurer's accreditation or certification.
(a) The commissioner shall give the reinsurer notice and opportunity for hearing. The suspension or revocation shall not take effect until after the commissioner's order on hearing, unless:
(1) The reinsurer waives its right to a hearing;
(2) The commissioner's order is based on regulatory action by the reinsurer's domiciliary jurisdiction or the voluntary surrender or termination of the reinsurer's eligibility to transact insurance or reinsurance business in its domiciliary jurisdiction or in the primary certifying state of the reinsurer under RSA 405:47, IV-a; or
(3) The commissioner finds that an emergency requires immediate action and a court of competent jurisdiction has not stayed the commissioner's action.
(b) While a reinsurer's accreditation or certification is suspended, no reinsurance contract issued or renewed after the effective date of the suspension qualified for credit except to the extent that the reinsurer's obligations under the contract are secured in accordance with RSA 405:50. If a reinsurer's accreditation or certification is revoked, no credit for reinsurance may be granted after the effective date of the revocation except to the extent that the reinsurer's obligations under the contract are secured in accordance with RSA 405:47, IV-a(e) and RSA 405:50.
II. (a) A ceding insurer shall take steps to manage its reinsurance recoverables proportionate to its own book of business. A domestic ceding insurer shall notify the commissioner within 30 days after reinsurance recoverables from any single assuming insurer, or group of affiliated assuming insurers, exceeds 50 percent of the domestic ceding insurer's last reported surplus to policyholders, or after it is determined that the reinsurance recoverables from any single assuming insurer, or group of affiliated assuming insurers, is likely to exceed this limit. The notification shall demonstrate that the exposure is safely managed by the domestic ceding insurer.
(b) A ceding insurer shall take steps to diversify its reinsurance program. A domestic ceding insurer shall notify the commissioner within 30 days after ceding to any single assuming insurer, or group of affiliated assuming insurers, more than 20 percent of the ceding insurer's gross written premium in the prior calendar year, or after it has determined that the reinsurance ceded to any single assuming insurer, or group of affiliated assuming insurers, is likely to exceed this limit. The notification shall demonstrate that the exposure is safely managed by the domestic ceding insurer.
Source. 2004, 186:1. 2013, 235:6, eff. Sept. 13, 2013.
405:50 Asset or Reduction From Liability for Reinsurance Ceded by a Domestic Insurer to an Assuming Insurer Not Meeting the Requirements of RSA 405:47.
An asset or a reduction from liability for the reinsurance ceded by a domestic insurer to an assuming insurer not meeting the requirements of RSA 405:47 shall be allowed in an amount not exceeding the liabilities carried by the ceding insurer; provided that the commissioner may adopt by rule, pursuant to RSA 541-A, specific additional requirements relating to or setting forth the valuation of assets or reserve credits, the amount and forms of security supporting reinsurance arrangements described in RSA 405:50-a, and the circumstances pursuant to which credit shall be reduced or eliminated. The reduction shall be in the amount of funds held by or on behalf of the ceding insurer, including funds held in trust for the ceding insurer, under a reinsurance contract with the assuming insurer as security for the payment of obligations under such contract, if the security is held in the United States subject to withdrawal solely by, and under the exclusive control of, the ceding insurer; or, in the case of a trust, held in a qualified United States financial institution, as defined in RSA 405:46, III. This security may be in the form of:
II. Securities listed by the Securities Valuation Office of the National Association of Insurance Commissioners, including those deemed exempt from filing as defined by the Purposes and Procedures Manual of the Securities Valuation Office, and qualifying as admitted assets.
III. (a) Clean, irrevocable, unconditional letters of credit, issued or confirmed by a qualified United States financial institution, as defined in RSA 405:46, II effective no later than December 31, of the year for which filing is being made, and in the possession of, or in trust for, the ceding insurer on or before the filing date of its annual statement;
(b) Letters of credit meeting applicable standards of issuer acceptability as of the dates of their issuance or confirmation shall, notwithstanding the issuing or confirming institution's subsequent failure to meet applicable standards of issuer acceptability, continue to be acceptable as security until their expiration, extension, renewal, modification, or amendment, whichever first occurs.
IV. Any other form of security acceptable to the commissioner.
Source. 2004, 186:1. 2013, 235:6, eff. Sept. 13, 2013. 2018, 193:2, eff. Aug. 7, 2018. 2020, 37:38, eff. Sept. 27, 2020.
405:50-a Rulemaking for Reinsurance.
The commissioner may adopt rules under RSA 541-A relative to reinsurance arrangements as follows:
I. Such rules shall apply only to reinsurance relating to:
(a) Life insurance policies with guaranteed nonlevel gross premiums or guaranteed nonlevel benefits.
(b) Universal life insurance policies with provisions resulting in the ability of a policyholder to keep a policy in force over a secondary guarantee period.
(c) Variable annuities with guaranteed death or living benefits.
(d) Long-term care insurance policies.
(e) Such other life and health insurance and annuity products as to which the NAIC adopts model regulatory requirements with respect to credit for reinsurance.
II. A rule adopted pursuant to subparagraph I(a) or I(b) may apply to any treaty containing policies issued on or after January 1, 2015, and policies issued prior to January 1, 2015, if risk pertaining to such pre-2015 policies is ceded in connection with the treaty, in whole or in part, on or after January 1, 2015.
III. A rule adopted under this section may require the ceding insurer, in calculating the amounts or forms of security required to be held, to use the Valuation Manual adopted by the NAIC under Section 11B(1) of the NAIC Standard Valuation Law, including all amendments adopted by the NAIC and in effect on the date as of which the calculation is made, to the extent applicable.
IV. A rule adopted pursuant to this section shall not apply to cessions to an assuming insurer that:
(a) Meets the conditions set forth in RSA 405:47, IV-b; or
(b) Is certified in this state; or
(c) Maintains at least $250,000,000 in capital and surplus when determined in accordance with the NAIC Accounting Practices and Procedures Manual, including all amendments thereto adopted by the NAIC, excluding the impact of any permitted or prescribed practices, and is:
(1) Licensed in at least 26 states; or
(2) Licensed in at least 10 states and licensed or accredited in a total of at least 35 states.
Source. 2018, 193:3, eff. Aug. 7, 2018. 2020, 37:39, eff. Sept. 27, 2020.
The commissioner may adopt rules, pursuant to RSA 541-A, implementing the provisions of this subdivision.
Source. 2004, 186:1. 2013, 235:6, eff. Sept. 13, 2013.
405:52 Reinsurance Agreements Affected.
Credit for reinsurance ceded to a certified reinsurer is allowed only for reinsurance contracts entered into or renewed on or after the effective date of the certification of the assuming insurer by the insurance commissioner.
Source. 2004, 186:1. 2013, 235:6, eff. Sept. 13, 2013.
Denial of Privileges, etc., by Other States
405:53 Reciprocal Denial.
If any state shall, by its laws, deny any insurance company or citizen of this state any rights or privileges which are granted to insurance companies and citizens of that state, this state shall in like manner deny to insurance companies and citizens of that state all such rights and privileges, and they shall be subject to all the restrictions and penalties prescribed by that state against insurance companies and citizens of this state.
Source. 1891, 54:1. PL 275:47. RL 325:52.
405:54 Writing Insurance.
If, by the laws of any state, the insurance commissioner or other official shall have the power to revoke the license of any company of this state or foreign state for writing insurance upon any person or property of that state, other than through or by a citizen of that state, the insurance commissioner of this state is empowered to revoke the license of any insurance company of that state, or any foreign insurance company licensed to do business in this state, that shall write for or through any agent of that state, directly or indirectly, upon any person or property of this state, except the same be written through a duly authorized agent, who shall be a citizen of this state.
Source. 1891, 54:1. PL 275:48. RL 325:53.
405:55 Commissions, etc.
If, by the laws of any other state, agents, brokers or companies of this state are prohibited from receiving commissions on policies of fire or casualty insurance written for them by agents or companies doing business in that state on persons or property residing or located therein the agents, brokers or companies resident in that state shall not be paid any commission, brokerage or other compensation upon any policy written for them by agents or companies doing business in this state.
Source. 1909, 85:1. PL 275:49. RL 325:54.
Any such agent or company of this state, who shall pay such commission, brokerage or other compensation upon any such policy so written for him or them upon persons or property in this state, shall be subject to the same penalties as are prescribed by the laws of that state for agents, brokers or companies of that state, who shall pay such commission, brokerage or other compensation to such agents, brokers or companies of this state.
Source. 1909, 85:1. PL 275:50. RL 325:55.
405:57 Notice to Agents.
It shall be the duty of the insurance commissioner, upon receiving information that, by the laws of any other state, agents, brokers or companies, residents of this state, are prohibited from receiving commissions on policies written for them by agents or companies of that state, to notify agents and companies doing business in this state of the existence of such a law and to enforce the same restrictions and penalties as prescribed by the laws of that state.
Source. 1909, 85:2. PL 275:51. RL 325:56.
405:58 Exclusion of Companies.
Whenever it shall appear to the commissioner of this state that any insurance company chartered by this state, and authorized by such commissioner in this state to engage in life, accident and health insurance business or any combination thereof, is refused permission to transact any such business or combination thereof within any state of the United States or within any foreign country, by the provisions of any law of such state or country which shall in terms prohibit, or shall be construed in such manner as to prohibit, such company from engaging in such business or combination thereof after such company has complied with all other laws of such state or foreign country the commissioner may cancel the authority of, or refuse a license to, every company organized by charter or under the laws of such other state or foreign country to do any of the kinds of business above mentioned in this state, and may refuse a certificate of authority to every such company thereafter applying to him for authority to do any such business in this state, so long as such New Hampshire company shall be refused permission to transact any such business or combination thereof in such other state or foreign country.
Source. 1915, 151:1. PL 275:52. RL 325:57.
405:59 Repealed by 1971, 244:19, V, eff. Aug. 17, 1971.
405:60 Revocation of Licenses.
If any such company shall refuse or neglect to pay any tax, fine, penalty, license, or fee imposed by the laws of this state, or fail to comply with any other requirement thereof, the commissioner may revoke its license.
Source. 1895, 100:1. 1921, 27:1. PL 275:54. RL 325:59.
405:61 Request for Information.
I. Any law enforcement investigator may request an insurance company licensed under this chapter to release any information in its possession relative to the disappearance, theft or loss of any motor vehicle, or other personal property. The insurance company shall release the information and cooperate with any official authorized to request such information pursuant to this section. The information may include but not be limited to:
(a) Any relevant insurance policy;
(b) Policy premium payment records;
(c) History of previous claims made by the insured for the theft, loss or disappearance of any motor vehicle or other personal property;
(d) Any other material relating to the investigation of the theft, loss or disappearance.
II. If an insurance company has reason to suspect that a theft, loss or disappearance of a motor vehicle or other personal property in the amount of $500 or more was caused by other than accidental means, the company shall notify the local or state law enforcement authorities and furnish them, either through a recognized bureau or organization of companies or through the secretary or other officer of the insurance company, with all relevant material acquired during its investigation of the theft, loss or disappearance of a motor vehicle or other personal property. The insurance company shall cooperate with and take such reasonable action as may be requested of it by any law enforcement agency, and permit any person so ordered by a court to inspect any of its records pertaining to the policy and the loss.
III. In the absence of fraud or malice, no public official or insurance company or person who furnishes information on behalf of the insurance company shall be liable for damages in a civil action or subject to criminal prosecution for any oral or written statement made or any other action taken that is necessary to supply information required pursuant to this section.
IV. The recipient of any information furnished pursuant to this section shall hold the information in confidence, and shall only release it to a law enforcement authority or agency or to the insurance department, until such time as its release is required pursuant to a criminal or civil proceeding.
V. An insurer or other person licensed by the insurance department who fails to comply with this section may be subject to administrative action to be taken by the insurance commissioner. The penalty imposed by the commissioner may include a fine not exceeding $2500 in the discretion of the insurance commissioner, or suspension or revocation of such insurer's license, or both.
Source. 1981, 502:5, eff. Aug. 28, 1981.
405:62 Approval as a Domestic Insurer.
Any insurer which is organized under the laws of any other state and is admitted to do business in this state for the purpose of writing insurance may become a domestic insurer upon the approval of the commissioner by amending its articles of incorporation or equivalent corporate charter to designate its change of domicile to this state, and by complying with all applicable requirements of Title XXXVII relative to the organization and licensing of a domestic insurer of the same type. Such domestic insurer shall be entitled to like certificates and licenses to transact business in this state, and shall be subject to the authority and jurisdiction of this state.
Source. 1991, 114:4. 2008, 255:4, eff. Aug. 25, 2008.
405:63 Conversion of Foreign Insurer.
Any domestic insurer may, upon the approval of the commissioner, transfer its domicile to any other state in which it is admitted to transact the business of insurance, and upon such a transfer shall cease to be a domestic insurer, and shall be admitted to this state if qualified as a foreign insurer.
Source. 1991, 114:4, eff. May 14, 1991.
405:64 Effects of Redomestication.
The certificate of authority, agents' appointments and licenses, rates, and other items which the commissioner allows, in his discretion, which are in existence at the time any insurer licensed to transact the business of insurance in this state transfers its corporate domicile to this or any other state by merger, consolidation or any other lawful method shall continue in full force and effect upon such transfer if such insurer remains duly qualified to transact the business of insurance in this state. All outstanding policies of any transferring insurer shall remain in full force and effect and need not be endorsed as to the new name of the company or its new location unless so ordered by the commissioner. Every transferring insurer shall file new policy forms with the commissioner on or before the effective date of the transfer, but may use existing policy forms with appropriate endorsements if allowed by, and under such conditions as approved by the commissioner. However, every such transferring insurer shall notify the commissioner of the details of the proposed transfer, and shall file promptly, any resulting amendments to corporate documents filed or required to be filed with the commissioner.
Source. 1991, 114:4, eff. May 14, 1991.
405:65 Filing with Secretary of State.
An insurer transferring its domicile to this state shall file the following documents with the secretary of state, together with applicable filing fees:
I. Restated articles of incorporation or equivalent, as amended pursuant to RSA 405:62; and
II. Executed order of the commissioner approving the redomestication.
Source. 2008, 255:5. 2015, 273:16, eff. Jan. 1, 2016.