Section 031-180-20 - Group Capital CalculationA. If a domestic insurer is a member of an insurance holding company system for which this State is not the lead state, procedures for filing the group capital calculation or for full or partial exemptions from filing shall be as specified in the lead state's regulation that is substantially similar to this rule, or as otherwise approved by the Superintendent if the lead state has not adopted a substantially similar regulation.B. If this State is the lead state for an insurance holding company system that has previously filed the annual group capital calculation at least once, the Superintendent has the discretion to exempt the ultimate controlling person from filing the annual group capital calculation, or to accept a limited group capital filing in lieu of the group capital calculation, if the Superintendent makes a determination based upon the most recent annual group capital filing that the insurance holding company system meets all of the following criteria: (1) Has annual direct written and unaffiliated assumed premium (including international direct and assumed premium but excluding premiums reinsured with the Federal Crop Insurance Corporation and Federal Flood Program), of less than $1,000,000,000;(2) Has no insurers within its holding company structure that are domiciled outside of the United States or one of its territories;(3) Has no banking, depository, or other financial entity that is subject to an identified regulatory capital framework within its holding company structure;(4) The holding company system attests that there are no material changes in the transactions between insurers and non-insurers in the group that have occurred since the most recent filing of the annual group capital calculation; and(5) The non-insurers within the holding company system do not pose a material financial risk to the insurer's ability to honor policyholder obligations.C. If this State is the lead state for an insurance holding company system that has previously been granted a full or limited exemption pursuant to Subsection B, the Superintendent may require the ultimate controlling person to file an annual group capital calculation at any time, completed in accordance with the NAIC Group Capital Calculation Instructions, if any of the following criteria is met: (1) Any insurer within the insurance holding company system is in a Risk-Based Capital action level event as set forth in Sections 6453 through 6456 of the Insurance Code or a similar standard established by the insurer's state or country of domicile; or(2) Any insurer within the insurance holding company system meets one or more of the criteria for hazardous financial condition as set forth in Bureau of Insurance Rule 710, Standards for Determining Whether an Insurance Carrier is in Hazardous Financial Condition, or a similar standard established by the insurer's state or country of domicile; or(3) Any insurer within the insurance holding company system otherwise exhibits qualities of a troubled insurer as determined by the Superintendent based on unique circumstances including, but not limited to, the type and volume of business written, ownership and organizational structure, federal agency requests, and international supervisor requests.D. For purposes of Subdivision 8(B-1)(2)(d)(ii) of the Act, a non-U.S. jurisdiction that is not a reciprocal jurisdiction recognizes and accepts the group capital calculation if a competent regulatory authority in the jurisdiction provides confirmation that the jurisdictionsatisfies both of the following criteria:(1) The jurisdiction recognizes the U.S. state regulatory approach to group supervision and group capital, as demonstrated by either:(a) Confirmation that insurers and insurance groups whose lead state is accredited by the NAIC under the NAIC Accreditation Program shall be subject only to worldwide prudential insurance group supervision by the lead state and will not be subject to group supervision by the non-U.S. jurisdiction, including worldwide group governance, solvency and capital, and reporting, at the level of the group's worldwide parent undertaking; or(b) If no U.S. insurance groups operate in the jurisdiction, a formal written confirmation to the lead state, with a copy to the International Association of Insurance Supervisors, that the group capital calculation is an acceptable international capital standard.(2) Information regarding insurers and their parent, subsidiary, or affiliated entities, if applicable, shall be provided to the lead state regulator in accordance with a memorandum of understanding or similar document between the lead state regulator and the jurisdiction, including but not limited to the International Association of Insurance Supervisors Multilateral Memorandum of Understanding or other multilateral memoranda of understanding coordinated by the NAIC. The Superintendent shall determine, in consultation with the NAIC Committee Process, whether the requirements of the information sharing agreements are in force.E. In making determinations under this section, the Superintendent shall consider any list of non-U.S. jurisdictions that recognize and accept the group capital calculation that is published through the NAIC Committee Process. (1) If this State is the lead state for the U.S. operations of a group headquartered outside the U.S.: (a) In determining whether the group shall be required to file an annual group capital calculation for its worldwide operations, the Superintendent shall consider whether the NAIC has listed its groupwide supervisor as a jurisdiction that recognizes and accepts the group capital calculation.(b) In determining whether the group shall be required to file an annual group capital calculation limited to its U.S. operations, the Superintendent shall consider whether the NAIC has identified its groupwide supervisor as a jurisdiction that requires a group capital filing for any U.S. based insurance group's operations in that jurisdiction.(2) If the Superintendent makes a determination that is contrary to the NAIC's published recommendations, the Superintendent shall provide thoroughly documented justification to the NAIC and other states.(3) Upon determining that a non-U.S. jurisdiction no longer recognizes and accepts the group capital calculation, the Superintendent may recommend to the NAIC that the non-U.S. jurisdiction be removed from the list of jurisdictions that recognize and accept the group capital calculation.02-031 C.M.R. ch. 180, § 20