§ 521J.14 — Reinsurance

Iowa § 521J.14

• Jurisdiction: Iowa
• Title XIII: COMMERCE
• Ch. 521J: CAPTIVE COMPANIES

Text

1. Subject to the prior approval of the commissioner, a captive company may provide
reinsurance on risks ceded by any other insurer.
2. Anycaptivecompanymaytakecreditforreservesonrisks,orportionsofrisks,cededto
reinsurersasprovidedunderchapter521B. Inordertocedeortakecreditforthereinsurance
ofrisksorportionsofriskscededtoreinsurersthatdonotcomplywithchapter521B,acaptive
company shall obtain the prior approval of the commissioner.
3. Insurance by a captive company of any workers’ compensation qualified self-insured
plan of the captive company’s parent and affiliates shall be deemed to be reinsurance under
this chapter.
4. In addition to reinsurers authorized under chapter 521B, a captive company may take
credit for the reinsurance of risks or portions of risk ceded to a pool or exchange acting
as a reinsurer which has been authorized by the commissioner. The commissioner may
require documents, financial information, or other evidence that such a reinsurance pool or
exchange will be able to provide adequate security for the reinsurance pool’s or exchange’s
financial obligations. The commissioner may deny authorization or impose any limitations
on the activities of a reinsurance pool or exchange that, in the commissioner’s judgment,
are necessary and proper to provide adequate security for the ceding captive company and
for the protection and benefit of the public.
5. No credit shall be allowed for reinsurance if the reinsurance contract does not result in
the complete transfer of the risk or liability to the reinsurer.
6. Nocreditshallbeallowed,asanassetoradeductionfromliability,toanycedinginsurer
for reinsurance unless the reinsurance is payable by the assuming insurer on the basis of the
liability of the ceding insurer under the contract reinsured without diminution because of the
insolvency of the ceding insurer.
7. Reinsurance under this section shall be effected through a written agreement of
reinsurance setting forth the terms, provisions, and conditions governing the reinsurance.
The commissioner may require that complete copies of all reinsurance agreements be filed
with and approved by the commissioner.