§ 8021 — Limitations on accumulation of surplus of mutual holding companies

New York § 8021

• Jurisdiction: New York
• Law ISC: Insurance
• Art. 80: Mutual Holding Company

Text

§ 8021. Limitations on accumulation of surplus of mutual holding\ncompanies. (a) A mutual holding company may maintain (1) a non-insurance\nsurplus not exceeding the aggregate capital and surplus of its insurance\nsubsidiaries and (2) aggregate capital and surplus of its insurance\nsubsidiaries not exceeding the surplus limit of its insurance\nsubsidiaries, unless otherwise approved by the superintendent.\n (b) As used in this section, the following terms shall have the\nfollowing meanings:\n (1) "Non-insurance surplus" means the mutual holding company's net\nworth, determined in accordance with generally accepted accounting\nprinciples on a consolidated basis, excluding the portion thereof\nderived from its interest in its insurance subsidiaries.\n (2) "Insurance subsidiary" means a subsidiary of the mutual holding\ncompany that is a domestic insurer, a foreign insurer, an alien insurer\nor (notwithstanding its exemption from this chapter) a health\nmaintenance organization.\n (3) "Aggregate capital and surplus" of a mutual holding company's\ninsurance subsidiaries means the sum of:\n (A) for each subsidiary that is a life insurance company and is not a\nsubsidiary of another life insurance company, its statutory capital and\nsurplus;\n (B) for each subsidiary that is an insurance company other than a life\ninsurance company, a health maintenance organization or a subsidiary of\nanother insurance subsidiary, its statutory capital and surplus; and\n (C) for each subsidiary that is a health maintenance organization and\nis not a subsidiary of an insurance subsidiary, thirty-five percent of\nits net premium written in the preceding calendar year.\n (4) "Surplus limit" of a mutual holding company's insurance\nsubsidiaries means the aggregate of:\n (A) for each subsidiary that is a life insurance company and is not a\nsubsidiary of another life insurance company, the greater of (i) eight\nhundred fifty thousand dollars, or (ii) ten percent of its policy\nreserves and policy liabilities, or (iii) ten percent of the policy\nreserves and policy liabilities of such life insurance company and of\nall subsidiaries of such company that are insurance companies, plus (x)\nthe product of three and the authorized control level RBC of such life\ninsurance company as determined in accordance with section one thousand\nthree hundred twenty-two of this chapter or corresponding provisions of\nthe law of its state of domicile, plus (y) for each subsidiary of such\ndomestic life insurance company that is a health maintenance\norganization, thirty-five percent of its net premium written in the\npreceding calendar year, minus (z) the asset valuation reserves of such\nlife insurance company and of all subsidiaries of such company that are\nlife insurance companies, or (iv) the minimum amount of capital and\nsurplus required by the law of another state in which such life\ninsurance company is authorized to do business, all as determined in\naccordance with accounting practices prescribed or permitted by the\nsuperintendent, in the case of domestic insurers, or the principal\nregulator of any insurance subsidiary that is not a domestic insurer;\n (B) for each subsidiary that is an insurance company other than a life\ninsurance company, a health maintenance organization or a subsidiary of\nanother insurance subsidiary, its statutory capital and surplus; and\n (C) for each subsidiary that is a health maintenance organization and\nis not a subsidiary of an insurance subsidiary, thirty-five percent of\nits net premium written in the preceding calendar year;\n (D) The superintendent may, for good cause shown, by order, permit\nsuch mutual holding company to maintain a surplus in excess of the\nmaximum prescribed by subsection (a) of this section, for a specified\nperiod, not exceeding one year under any one order. The superintendent\nshall state in such order the reasons therefor and shall cause a\nstatement of such order and such reasons to be published in the next\nannual report of the superintendent to the legislature.\n