On 22 September 2010, the European Parliament approved a sweeping overhaul of financial supervision in Europe, including the creation of a new supervisory authority for insurance and reinsurance – the European Insurance and Occupational Pensions Authority (EIOPA) – and a European Systemic Risk Board (ESRB) which will monitor threats to the EU economy as a whole.
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Regulatory
NAIC Posts Draft STOA Bulletin for Comment
By Troutman Pepper Locke on
The NAIC Life and Annuities Committee has posted a draft model bulletin (the “Draft Bulletin”) recommending that insurers implement certain safeguards in order to limit their potential exposure to stranger-originated annuity transactions (“STOA”). STOA transactions are defined in the Draft Bulletin as transactions in which agents or investors offer an individual, who is usually a stranger to the agent or investor, a nominal fee for the use of the individual’s identity as the measuring life on an investment oriented annuity. …
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Massachusetts Amends Laws to Permit Alien Surplus Lines Insurers
The Massachusetts Division of Insurance (“MDOI”) recently amended its surplus lines laws to allow for the approval of alien unauthorized insurers in the state. Previously, Massachusetts required that alien surplus lines insurers maintain a trusteed surplus in the US of $20 million and file financial information on an annual basis following US accounting principles which effectively made obtaining surplus lines eligibility in the state prohibitive for alien insurers. …
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UPDATE: California Surplus Lines Reforms Signed Into Law
By Troutman Pepper Locke on
Posted in Excess and Surplus Lines, Regulatory
This updates our September 1, 2010 posting. On September 27, 2010, California Governor Arnold Schwarzenegger signed into law AB 1708, which will have a significant impact on surplus lines insurers by amending Section 1765.1 of the California Insurance Code. …
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UK: Proposed Special Administration Regime For Investment Banks
HM Treasury has issued a consultation paper on proposals for a special administration regime for investment banks which it hopes will lead to less disruption in financial markets and simplify the process of returning assets and money to clients and creditors of a failing bank. …
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New York Considers Catastrophe Pool
By Troutman Pepper Locke on
The New York State Insurance Department (“NYID”) issued a news release on September 22, 2010 (the “News Release”) announcing proposed measurers aimed at ensuring the availability and affordability of homeowners insurance in coastal areas of New York. Such proposals include the creation of a catastrophe pool to be funded by insurer assessments and used to help cover the cost of hurricanes and other catastrophes. …
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The Bermuda Monetary Authority Extends Class 4 Solvency Requirements to Class 3B Insurers
By Troutman Pepper Locke on
In a continuing effort to enhance the supervisory regime for Bermuda-based (re)insurers ahead of third country assessment of its framework under Solvency II, the Bermuda Monetary Authority (“BMA”) issued a 2010 Amendment to the Insurance (Prudential Standards) (Class 4 Solvency Requirement) Order of 2008. The 2010 Order, captioned Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Amendment Order 2010, will extend the requirements currently applicable to Class 4 insurers, to Class 3B insurers. …
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NAIC Representative Selected for Financial Stability Oversight Council
By Troutman Pepper Locke on
The National Association of Insurance Commissioners (“NAIC”) has selected Missouri Insurance Director John Huff as its representative on the new Financial Stability Oversight Council (the “FSOC”), which was created under the Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”). …
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The Dodd-Frank Act: The U.S. Government Turns its Attention to Insurance Regulation
By Troutman Pepper Locke on
(This is a partial excerpt of an article previously published in Bloomberg Insurance Law Report available here.) The Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act)1 is the latest development in the ongoing saga of state versus federal regulation of insurance. Unlike other major industries, insurance is still primarily and almost exclusively regulated by the states – and the states have long been vigilant about keeping it that way. …
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Congress Passes One-Year Extension for National Flood Insurance Program
By Troutman Pepper Locke on
As we previously reported here, earlier this week the U.S. Senate passed the Flood Insurance Program Reextension Act of 2010 (S. 3814) (the “Act”) to extend the National Flood Insurance Program (“NFIP”) from September 30, 2010 to September 30, 2011. The U.S. House of Representatives passed the Act yesterday. The Act is expected to be signed by President Obama shortly. …
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