The National Association of Insurance Commissioners (NAIC) has directed its committees to move forward with amending the Reinsurance Model Law and Regulation (Models) to be consistent with the EU/U.S. Covered Agreement signed last September. The Covered Agreement eliminates collateral and physical presence requirements for EU/U.S. reinsurers. States have 60 months to implement the collateral provisions or risk Federal Insurance Office (FIO) preemption of state law.
The amended Models would extend similar terms to reinsurers domiciled in non-EU qualified jurisdictions of Bermuda, Japan, Switzerland, and the post-Brexit UK.
Plans call for the Models to be drafted and submitted to the Executive Committee prior to year-end.
State regulators have stated key points for inclusion in the Models are recognition of the U.S. regulatory system of group supervision, capital and solvency.
