(a)The Arkansas Insurance Code does not apply to captive insurance companies except for those provisions contained in or specifically referenced in this subchapter that are to be incorporated into the Arkansas Insurance Code.
(b)The Insurance Commissioner may exempt by rule or other order special purpose captive insurance companies on a case-by-case basis from the provisions of this chapter that he or she determines to be inappropriate, given the nature of the risks to be insured.
(c)In addition to this subchapter, the following provisions of the Arkansas Insurance Code and applicable rules apply to a risk retention group formed under the Risk Retention and Purchasing Groups Act, § 23-94-201 et seq., and subject to this subchapter:
(1)Section 23-61-201 et seq., and the Arkansas Credit
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(a) The Arkansas Insurance Code does not apply to captive insurance companies except for those provisions contained in or specifically referenced in this subchapter that are to be incorporated into the Arkansas Insurance Code. (b) The Insurance Commissioner may exempt by rule or other order special purpose captive insurance companies on a case-by-case basis from the provisions of this chapter that he or she determines to be inappropriate, given the nature of the risks to be insured. (c) In addition to this subchapter, the following provisions of the Arkansas Insurance Code and applicable rules apply to a risk retention group formed under the Risk Retention and Purchasing Groups Act, § 23-94-201 et seq., and subject to this subchapter: (1) Section 23-61-201 et seq., and the Arkansas Credit for Reinsurance Law, § 23-62-301 et seq., referring to the commissioner; (2) The Reinsurance Intermediary Act, § 23-62-401 et seq.; (3) Sections 23-63-212 and 23-63-213 , referring to certificates of authority; (4) Section 23-63-216(e) and the Property and Casualty Actuarial Opinion Law, § 23-63-1901 et seq., referring to actuarial opinions; (5) The Insurance Holding Company Regulatory Act, § 23-63-501 et seq., and § 23-69-129 , referring to dividends to stockholders; (6) Section 23-63-601 et seq., referring to financial reporting standards; (7) Section 23-63-701 , referring to limits of risk; (8) Section 23-63-801 et seq., referring to investments; (9) The Business Transacted with Producer Controlled Property and Casualty Insurer Act, § 23-63-1101 et seq., referring to producer controlled business; (10) With the exception of § 23-63-1304(f) and § 23-63-1311 , the Risk-Based Capital Act, § 23-63-1301 et seq., referring to risk-based capital; (11) Section § 23-64-201 et seq., and the Producer Licensing Model Act, § 23-64-501 et seq., referring to licensure; (12) The Managing General Agents Act, § 23-64-401 et seq., referring to managing general agents; and (13) Section 23-68-101 et seq., and § 23-69-138 , referring to impairment of capital or assets. (d) If subsection (c) of this section is in conflict with this subchapter, subsection (c) of this section controls. (e) Except as provided in this subchapter, the Risk Retention and Purchasing Groups Act, § 23-94-201 et seq., applies to a risk retention group formed as a captive insurer. (f) In determining whether to take regulatory action under §§ 23-63-1304 - 23-63-1307 , the commissioner may consider the adequacy of documentation evidencing the sound financial condition of the risk retention group's members or sponsoring organizations and intent to financially support the risk retention group, including: (1) (A) A minimum of three (3) years of audited financial statements of the member or sponsor and one (1) year of projected financial information. (B) The projected financial information required in subdivision (f)(1)(A) of this section shall include: (i) An investment grade rating from a nationally recognized statistical rating organization or A.M. Best rating of A- or better; (ii) Equity equal to or greater than one hundred million dollars ($100,000,000); and (iii) Equity equal to or greater than ten (10) times the risk retention group's largest net retained per occurrence limit; and (2) (A) Policyholder qualification as an industrial insured in this state or the policyholder's home state, depending upon which state has the more stringent requirements. (B) If the home state of the policyholder does not have an industrial insured exemption or its equivalent, the policyholder shall qualify under the industrial requirement of this state.