§ 38a-71 — Minimum asset requirements. Minimum capital and minimum surplus requirements.

Connecticut § 38a-71

• Jurisdiction: Connecticut
• Title 38a: Insurance
• Ch. 698: Insurers

Text

(a) As used in this section: (1) “Qualified assets” means: (A) Investments, securities, properties and loans permitted or authorized by law, and the income due thereon; (B) The net amount of uncollected and deferred premiums for a life insurer which carries the full annual mean tabular reserve liability; (C) Premiums in the course of collection, other than for life insurance, not more than ninety days past due, with the ninety-day limitation being inapplicable to premiums payable directly or indirectly by the United States government or any of its instrumentalities; (D) Installment premiums, other than life insurance premiums, in accordance with the regulations adopted by the commissioner in accordance with the provisions of chapter 54, or in the absence of these regulations then in accordance with practices formulated or adopted by the National Association of Insurance Commissioners; (E) Notes and similar written obligations which are not past due, taken for premiums other than life insurance premiums, on policies permitted to be issued on that basis, to the extent of the unearned premium reserves carried on the policies; (F) Amounts recoverable or receivable from reinsurers under a reinsurance contract; (G) Tangible components of health care delivery systems for health care centers governed by sections 38a-175 to 38a-194 , inclusive, with the cost of these assets having a finite useful life being depreciated in full over periods provided by regulations adopted by the commissioner in accordance with the provisions of chapter 54; (H) Electronic data processing equipment and operating software, the cost of which is depreciated in full over a period not to exceed three years; (I) Tangible components of the service delivery systems of legal service corporations governed by sections 38a-230 to 38a-245 , inclusive, with the cost of these assets having a finite useful life being depreciated in full over periods provided by regulations adopted by the commissioner in accordance with the provisions of chapter 54; (J) Cash or currency; and (K) Other assets authorized by regulations adopted by the commissioner in accordance with the provisions of chapter 54. (2) “Minimum capital and minimum surplus” means the capital and surplus that must constantly be maintained by a stock insurance company as required by section 38a-72 . (3) “Surplus” means total statutory surplus less capital stock, adjusted for the par value of any treasury stock, calculated in accordance with the National Association of Insurance Commissioners Accounting Practices and Procedures Manual, version effective January 1, 2001, and subsequent revisions. Except for assessable mutuals, the minimum surplus of a mutual insurer is essentially the same as the minimum required capital requirement which applies to stock-insurers. (4) “Capital” means the capital stock component of statutory surplus, as defined in the National Association of Insurance Commissioners Accounting Practices and Procedures Manual, version effective January 1, 2001, and subsequent revisions. (b) Each insurer authorized to do business in this state shall maintain qualified assets in the amount equal to the total of the insurer's (1) liabilities, and (2) minimum capital and minimum surplus required under section 38a-72 .

Legislative History

(P.A. 90-243, S. 45; P.A. 93-239, S. 2; P.A. 00-30, S. 2, 14; P.A. 17-198, S. 14.) History: P.A. 93-239 deleted former Subsecs. (c) and (d) re the commissioner's determination of the sufficiency of surplus and the evidence used to evaluate such sufficiency, respectively; P.A. 00-30 amended definition of “qualified assets” in Subsec. (a) to revise the calculation of premium in Subpara. (a)(1)(C) to delete reduction for commissions payable on premiums, and to amend Subpara. (a)(1)(H) to substitute “electronic data processing equipment and operating software” for “electronic and mechanical machines constituting a data processing and accounting system”, amended Subdiv. (a)(2) to substitute “minimum capital and minimum surplus” for “minimum capital”, amended definition of “surplus” in Subdiv. (a)(3), added Subdiv. (a)(4) to define “capital”, and amended Subsec. (b) to substitute “minimum capital and minimum surplus” for “minimum capital or minimum surplus”, effective January 1, 2001; P.A. 17-198 amended Subsec. (a)(1)(G) by replacing reference to Sec. 38a-192 with reference to Sec. 38a-194, effective July 1, 2017.