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As reported in our February 15, 2011, and March 1, 2011, Client Advisories, New York Governor Andrew Cuomo released a bill on February 1, as part of his 2011-2012 budget, proposing to merge the State’s Insurance and Banking Departments. On March 31, 2011, the Governor signed the budget into law, including the final version of the merger legislation, entitled the Financial Services Law (the “FSL”), which, effective October 2011, will consolidate the Insurance and Banking Departments into a new, single agency to be known as the Department of Financial Services (the “DFS”). This Client Advisory describes some of the provisions of the adopted legislation most likely to affect individual entities or the industry as a whole. …
Read More Client Advisory – New York Enacts Legislation to Merge the Insurance and Banking Departments

On April 18, 2011, the Superintendent of the New York Insurance Department promulgated the twelfth amendment to Regulation 41 (the “Amendment”).  Pursuant to the Amendment, excess lines insurers obtaining eligibility in New York on or after January 1, 2011 must maintain surplus to policyholders of at least $45,000,000, instead of $15,000,000. …
Read More New York Officially Increases Minimum Surplus Requirement for Excess Lines Insurers

Indiana recently enacted HB 1486 (enacted as PL 11, 2011, the “Act”), which, effective April 6, 2011, grants the Indiana Insurance Commissioner (the “Commissioner”) discretion to reduce the amount of collateral required for domestic insurers to receive full financial statement credit for reinsurance ceded to assuming insurers that are not licensed or accredited by, or for an alien company entered through, Indiana or a state with similar standards regarding credit for reinsurance. …
Read More Indiana Joins New York, New Jersey and Florida in Relaxing Credit for Reinsurance Collateral Requirements

Last week, the National Association of Insurance Commissioners (“NAIC”) announced that it has changed the name of its New York office (the “NY Office”) from the “Securities Valuation Office” to the “Capital Markets and Investment Analysis Office.”  The name change is in connection with changes made to the responsibilities of the NY Office. …
Read More NAIC Changes Name and Scope of New York Office

Richard Bouhan, Executive Director of the National Association of Professional Surplus Lines Offices (NAPSLO), recently stated that the National Association of Insurance Commissioners (“NAIC”) is attempting to undercut the surplus lines reforms in the Nonadmitted and Reinsurance Reform Act (the “Act”), which becomes effective on July 21, 2011. …
Read More NAPSLO Questions NAIC ‘s Handling of the Nonadmitted and Reinsurance Reform Act

On April 14, 2011, John Huff, Director of the Missouri Department of Insurance, Financial Institutions, and Professional Registration, testified before the U.S. House of Representatives Committee on Financial Services on behalf of the National Association of Insurance Commissioners (the “NAIC”) at a hearing on “Oversight of the Financial Stability Oversight Council.”  In his testimony, Director Huff was critical of the Financial Stability Oversight Council (the “FSOC”) and the U.S. Department of the Treasury (the “Treasury”). …
Read More House Hearing on FSOC: NAIC Testifies; U.S. Representatives Ask About FSOC Insurance Expertise

On April 5, 2011, the U.S. Senate approved legislation that would repeal the expanded IRS Form 1099 information-reporting requirements imposed by Section 9006 of the Patient Protection and Affordable Care Act (“PPACA”).  Having also been approved by the U.S. House of Representatives on March 3, 2011, the bill is now expected to be signed into law by President Barack Obama. …
Read More 1099 Repeal Requirement: On Its Way to the White House

The Rhode Island Department of Business Regulation and Office of the Health Insurance Commissioner recently proposed new regulations (the “Proposed Regulations”) regarding the issuance of insurance policies to Rhode Island trusts and associations. If promulgated, the Proposed Regulations could have a significant impact on insurers and brokers that issue or renew insurance policies to trusts and associations in Rhode Island, as well as the trustees responsible for maintaining such trusts. …
Read More Client Advisory – Rhode Island Agencies Propose Regulations Imposing Additional Requirements on Group Policies Issued to Rhode Island Trusts and Associations

Earlier this month, Alterra Capital Holdings Ltd. and Stone Point Capital LLC announced that they formed a sidecar named New Point IV, both agreeing to commit up to $100 million. According to the press release, New Point IV was created due to “the recent series of global catastrophic events . . reducing the capital supporting the international property catastrophe reinsurance market . . . .” …
Read More Formation of Alterra/Stone Point Side Car May Mark Start of a Trend

Unlike other several other states as we reported here, New York has enacted legislation as part of its budget bill that does not authorize the state to enter into the Surplus Lines Insurance Multi-State Compliance Compact (“SLIMPACT”), or any other surplus lines tax allocation compact.  SLIMPACT is an interstate compact that is designed to, among other things, allow for the adoption of uniform standards across participating compact states and uniform tax allocation formulas on multi-state risks. …
Read More New York Rejects SLIMPACT