Agency 40. Insurance Department
Article 1. General
40-1-43 Reinsurance
trust instruments; letters of credit.
(a) Sections 10
and 11 of the national association of insurance commissioners’ “credit for reinsurance model
regulation,” January 1997 edition, with amended pages 5 through 22 dated
July 2001, are adopted by reference, subject to the following exceptions:
(1) In
section10(B)(1), delete “Section [insert citation to state law equivalent to
Section 4B of the Credit for Reinsurance Model Law],” and replace it with
“K.S.A. 40-221a and amendments thereto.”
(2) In section
10(B)(11)(c), delete “Section [insert citation to state law equivalent of
Section 4B of the Credit for Reinsurance Model Law],” and replace it with
“K.S.A. 40-221a and amendments thereto.”
(3) Section
10(D)(4) is not adopted by reference.
(4) In section
11(A), delete “Section [insert citation to state law equivalent to 4A of the
Credit for Reinsurance Model Law],” and replace it with “K.S.A. 40-221a and
amendments thereto.”
(5) In section
11(G), delete “Section [insert citation to state law equivalent to 4A of the
Credit for Reinsurance Model Law],” and replace it with “K.S.A. 40-221a and
amendments thereto.”
(b) Each trust
that is used by an insurer, organized under the laws of this state, to
demonstrate compliance with K.S.A. 40-221a(b)(1) and (3), and amendments
thereto, shall be established in a form approved by the commissioner. The trust instrument shall include all of the
following provisions:
(1) Entry of the final order of any court of competent jurisdiction in the
(2) Legal title to the assets of the trust will be vested in the trustee for
the benefit of the grantor's
(3) The commissioner will have the power to examine the trust.
(4) The trust will remain in effect for as long as the assuming group or
insurer has outstanding obligations under reinsurance agreements subject to the
trust.
(5) On or before February 28 of each year, a written report prepared by the
trustees will be sent to the commissioner of insurance containing the
following:
(A) The balance in the trust;
(B) a listing of the trust's investments at the end of the preceding year; and
(C) a certification of the termination date of the trust, or a certification
that the trust will not expire before the following December 31.
(b) Each amendment to the trust shall be reviewed and approved by the
commissioner before that amendment becomes effective.
(c) The provisions in subsections (a) and (b) above shall not apply to a
domestic title insurance company subject to the provisions of K.S.A. 40-1107a
and amendments thereto.
(Authorized by K.S.A. 40-221a and K.S.A. 40-103; implementing K.S.A. 40-221a; effective Jan. 24, 1997; amended May 25, 2001; amended, T-40-12-11-01, Dec. 11, 2001; amended April 19, 2002.)