Ark. Code § 23-69-503

Current with legislation from 2024 Fiscal and Special Sessions.

Section 23-69-503 - Definitions

As used in this subchapter:

(1) "Affiliate" means an affiliate as that term is defined in § 23-63-503;

(2) "Applicant" means a transferring insurer or reinsurer that submits an application under § 23-69-506;

(3)

(A) "Assuming insurer" means an insurer domiciled in this state that assumes or seeks to assume policies from a transferring insurer under this subchapter.

(B) "Assuming insurer" may include a company established under § 23-63-1601 et seq.;

(4) "Implementation order" means an order issued by the Pulaski County Circuit Court under § 23-69-509;

(5) "Independent expert" means an impartial person who:

(A) Does not have a financial interest in either the transferring insurer or the assuming insurer;

(B) Has not been employed by or acted as an officer, director, consultant, or other independent contractor for either the transferring insurer or the assuming insurer within the past twelve (12) months;

(C) Has not been appointed by the Insurance Commissioner to assist in any capacity in any proceeding;

(D) Has not received any compensation in connection with an insurance business transfer under this subchapter other than a fee based on a fixed or hourly basis that is not contingent on the approval or consummation of the insurance business transfer; and

(E) Has proof of insurance coverage that is satisfactory to the commissioner;

(6)

(A) "Insurance business transfer" means a transfer of insurance obligations or risks, or both, of existing or in-force contracts of insurance or reinsurance from a transferring insurer to an assuming insurer.

(B) Once approved, the insurance business transfer shall effect a transfer and novation of the transferred contracts of insurance or reinsurance with the result that the assuming insurer becomes directly liable to the policyholders of the transferring insurer and the transferring insurer's insurance obligations or risks, or both, under the contracts, are extinguished;

(7) "Insurance business transfer plan" means the plan submitted to the State Insurance Department to accomplish the transfer and novation under an insurance business transfer, including any associated transfer of assets and rights from or on behalf of the transferring insurer to the assuming insurer;

(8) "Insurer" means an insurance or surety company, including a reinsurance company, and includes a corporation, company, partnership, association, society, order, individual, or aggregation of individuals engaging in, proposing to engage in, or attempting to engage in any kind of insurance or surety business, including the exchanging of reciprocal or inter-insurance contracts between individuals, partnerships, and corporations;

(9) "Policy" means a policy, contract or certificate of insurance, or a contract of reinsurance under which the insurer agrees to assume an obligation or risk, or both, of the policyholder or to make payments on behalf of, or to, the policyholder or its beneficiaries, and includes property, casualty, life, health, and any other line of insurance the commissioner finds is suitable for an insurance business transfer;

(10) "Policyholder" means an insured or a reinsured under a policy that is part of a subject business;

(11) "Subject business" means the policy or policies that are the subject of the insurance business transfer plan;

(12) "Transfer and novation" means the transfer of insurance obligations or risks, or both, of existing or in-force policies from a transferring insurer to an assuming insurer, and is intended to effect a novation of the transferred policies with the result that:

(A) The assuming insurer becomes directly liable to the policyholders of the transferring insurer on the transferred policies; and

(B) The transferring insurer's insurance obligations or risks, or both, under the transferred policies are extinguished; and

(13) "Transferring insurer" means an insurer or reinsurer that transfers and novates or seeks to transfer and novate obligations or risks, or both, under one (1) or more policies to an assuming insurer under an insurance business transfer plan.

Ark. Code § 23-69-503

Added by Act 2021, No. 1018,§ 1, eff. 7/28/2021.