Pennsylvania Code & Bulletin
COMMONWEALTH OF PENNSYLVANIA

• No statutes or acts will be found at this website.

The Pennsylvania Code website reflects the Pennsylvania Code changes effective through 53 Pa.B. 8238 (December 30, 2023).

31 Pa. Code § 161.8a. Reinsurance contracts.

§ 161.8a. Reinsurance contracts.

 A ceding insurer will not be granted a credit or allowed an asset or reduction from liability for reinsurance effected with assuming insurers meeting the requirements of this chapter unless the reinsurance agreement includes the following provisions:

   (1)  A proper insolvency clause as provided for in section 319.1(d) of the act (40 P. S. §  442.1(d)), which stipulates that reinsurance is payable directly to the liquidator or successor without diminution regardless of the status of the ceding company.

   (2)  A reinsurance intermediary clause, if applicable, which stipulates that the credit risk for the intermediary is carried by the assuming insurer.

   (3)  A mandatory funding clause requiring the certified reinsurer to provide and maintain security in an amount sufficient to avoid the imposition of a financial statement penalty on the ceding insurer for reinsurance ceded to the certified reinsurer.

Authority

   The provisions of this §  161.8a issued under sections 206, 506, 1501 and 1502 of The Administrative Code of 1929 (71 P. S. § §  66, 186, 411 and 412); and section 319.1 of The Insurance Company Law of 1921 (40 P. S. §  442.1).

Source

   The provisions of this §  161.8a adopted May 24, 2013, effective June 24, 2013, 43 Pa.B. 2816.

Cross References

   This section cited in 31 Pa. Code §  161.3b (relating to calculation of credit for reinsurance regarding obligations secured with certified reinsurers).



No part of the information on this site may be reproduced for profit or sold for profit.


This material has been drawn directly from the official Pennsylvania Code full text database. Due to the limitations of HTML or differences in display capabilities of different browsers, this version may differ slightly from the official printed version.