Bill Text: NY S05808 | 2011-2012 | General Assembly | Introduced

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Bill Title: Relates to an exemption for certain stock and non-stock insurance companies.

Sponsorship: Partisan Bill (Republican 2)

Status: (Engrossed - Dead) 2012-01-05 - PRINT NUMBER 5808A [S05808 Detail]

Download: New_York-2011-S05808-Introduced.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         5808
                              2011-2012 Regular Sessions
                                   I N  S E N A T E
                                     June 17, 2011
                                      ___________
       Introduced  by  Sen.  DeFRANCISCO -- read twice and ordered printed, and
         when printed to be committed to the Committee on Rules
       AN ACT to amend the insurance law, in relation to exemption for  certain
         stock  and non-stock insurance companies; and providing for the repeal
         of such provisions upon expiration thereof
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section  1.  The insurance law is amended by adding a new section 1326
    2  to read as follows:
    3    S 1326. STATUTORY ASSOCIATION MEMBERSHIP; OBLIGATIONS. (A)  FOR  THOSE
    4  STOCK AND NON-STOCK COMPANIES TO WHICH SUBPARAGRAPH (B) OF PARAGRAPH TWO
    5  OF  SUBSECTION  (B) OF SECTION ONE THOUSAND THREE HUNDRED TWENTY-FOUR OF
    6  THIS ARTICLE APPLIES, NO LIABILITIES ARISING FROM THE OBLIGATIONS OF  AN
    7  ASSOCIATION  AUTHORIZED PURSUANT TO SUBPARAGRAPH (D) OF PARAGRAPH TWO OF
    8  SUBSECTION (C) OF SECTION FIVE THOUSAND FIVE HUNDRED TWO OF THIS CHAPTER
    9  SHALL BE DUE AND OWING FROM SUCH COMPANIES UNLESS AND UNTIL  SUCH  OBLI-
   10  GATIONS  CAN  BE  SATISFIED, AFTER CONSIDERATION OF ALL RESOURCES OF THE
   11  ASSOCIATION, INCLUDING BUT NOT LIMITED TO CURRENT PREMIUM INCOME,  BY  A
   12  CONTRIBUTION  FROM SUCH COMPANIES AND THE COMPANIES ARE NOTIFIED OF SAME
   13  BY SUCH ASSOCIATION NOT LESS THAN THREE HUNDRED SIXTY-FIVE DAYS PRIOR TO
   14  THE DATE UPON WHICH SUCH OBLIGATIONS SHALL BE DUE AND OWING,  AND  SHALL
   15  ONLY  RELATE TO OBLIGATIONS OF THE ASSOCIATION THAT ARE ACTUALLY DUE AND
   16  OWING BY THE ASSOCIATION IN THAT YEAR IN WHICH  CONTRIBUTION  IS  TO  BE
   17  MADE  BY THE COMPANIES. SUCH OBLIGATIONS SHALL NOT BE AGGREGATED FOR ANY
   18  OTHER YEAR EXCEPT THAT IN WHICH THE CONTRIBUTION IS  DUE  AND  OWING  OR
   19  PREVIOUS YEARS FOR WHICH CONTRIBUTIONS HAVE NOT BEEN SATISFIED; FURTHER,
   20  SUCH  LIABILITIES  AND  THE CONTRIBUTIONS THEREFOR SHALL NOT INCLUDE ANY
   21  CONTINGENT LIABILITIES  OF  THE  ASSOCIATION  FOR  THE  YEAR  FOR  WHICH
   22  CONTRIBUTIONS  ARE  REQUESTED;  PROVIDED,  HOWEVER, THAT COMPANIES SHALL
   23  MAINTAIN AT ALL TIMES A RESERVE OF NOT LESS THAN TWENTY PERCENT OF THEIR
   24  RESPECTIVE AND PROPORTIONATE LIABILITIES OF THE AGGREGATE DEFICIT OF THE
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD11724-05-1
       S. 5808                             2
    1  ASSOCIATION, AS SUCH RESPECTIVE AND  PROPORTIONATE  LIABILITIES  OF  THE
    2  AGGREGATE  DEFICIT  ARE  REPORTED BY THE ASSOCIATION CONSISTENT WITH THE
    3  PROVISIONS OF THIS SECTION; FURTHER, COMPANIES SHALL EACH YEAR  INCREASE
    4  ITS MINIMUM RESERVE, ASSUMING IT IS LESS THAN ONE HUNDRED PERCENT OF THE
    5  RESPECTIVE  AND  PROPORTIONATE  LIABILITY OF A COMPANY FOR THE AGGREGATE
    6  DEFICIT OF THE ASSOCIATION, BY THE PERCENTAGE INCREASE IN THE  AGGREGATE
    7  DEFICIT OF THE ASSOCIATION FROM THE PREVIOUS YEAR.
    8    (B)  THE SUPERINTENDENT SHALL, FOR A YEAR IN WHICH THE AGGREGATE DEFI-
    9  CIT OF THE ASSOCIATION IS REPORTED BY THE  ASSOCIATION  AS  REQUIRING  A
   10  CONTRIBUTION, INSTRUCT CONTRIBUTING COMPANIES TO INCREASE RESPECTIVE AND
   11  PROPORTIONATE RESERVES PROVIDED FOR IN SUBSECTION (A) OF THIS SECTION BY
   12  AN  AMOUNT  NOT  LESS  THAN  TWENTY-FIVE  PERCENT  PER YEAR AND FOR EACH
   13  CONSECUTIVE YEAR THEREAFTER FOR EACH YEAR THAT A CONTRIBUTION IS  NECES-
   14  SARY  UNTIL  SUCH TIME AS A COMPANY HAS REACHED A RESERVING LEVEL OF ONE
   15  HUNDRED PERCENT OF ITS RESPECTIVE AND PROPORTIONATE LIABILITIES FOR  THE
   16  AGGREGATE  DEFICIT OF THE ASSOCIATION; PROVIDED, HOWEVER, THAT COMPANIES
   17  MAY REDUCE ITS RESERVES THEREAFTER BY SUCH AMOUNT IN AND FOR THE  SECOND
   18  CONSECUTIVE YEAR AND EACH YEAR THEREAFTER IN WHICH A CONTRIBUTION IS NOT
   19  REQUIRED  TO  THE MINIMUM RESERVE PROVIDED FOR IN SUBSECTION (A) OF THIS
   20  SECTION.
   21    S 2. This act shall take effect December 31, 2011 and shall be consid-
   22  ered in effect for the purposes  of  companies'  2011  annual  financial
   23  statements;  provided, however, that this section shall expire on Decem-
   24  ber 31, 2015; provided further, that the superintendent  shall  evaluate
   25  the  proper  reserving level necessary for maintaining adequate security
   26  for the aggregate deficit of the association in light of  loss  develop-
   27  ment  trends,  claims  settlement  trends,  actuarial projections of the
   28  financial condition of the association and other factors and  report  to
   29  the  legislature  on the findings of such evaluation no later than March
   30  31, 2015.