02-031-760 Me. Code R. § 2

Current through 2024-46, November 13, 2024

Section 031-760-2 - Preamble

A. The State of Maine Bureau of Insurance recognizes that licensed insurers routinely enter into reinsurance agreements that yield legitimate relief to the ceding insurer from strain to surplus.

It is, however, improper for a licensed ceding insurer to enter into a reinsurance agreement for the principal purpose of obtaining significant surplus aid without transferring all of the significant risks inherent in the business being reinsured, as the expected potential liability of the ceding insurer under such agreement remains essentially unchanged by the reinsurance agreement, notwithstanding certain risk elements contained in the agreement, such as catastrophic mortality or extraordinary survival. If the terms of a reinsurance agreement give rise to any of the conditions enumerated in Section 4(A), the existence of such condition may constitute a violation or noncompliance with one or more of the following:

(1)24-A M.R.S.A. §424(2);

(2)24-A M.R.S.A. §731-B;

(3)24-A M.R.S.A. §417(2)(a);

(4)24-A M.R.S.A. §4356.

02-031 C.M.R. ch. 760, § 2