S3543-2013 Actions

• Feb 5, 2013: REFERRED TO INSURANCE

S3543-2013 Memo

BILL NUMBER:S3543

TITLE  OF  BILL:   An act to amend the insurance law, in relation to the
redomestication of insurance companies

PURPOSE: To provide for the more efficient regulation of insurance enti-
ties by more closely conforming New York law governing the  redomestica-
tion  of  insurance  companies  to the National Association of Insurance
Commissioners (NAIC) Redomestication Model Act.

SUMMARY OF PROVISIONS: This bill would amend � 7120 to the Insurance Law
by adding a new subsection  (c)  and  subsection  (h)  to  more  closely
conform  New  York Jaw governing the redomestication of insurance compa-
nies to the NAIC Redomestication Model  Bill.  Specifically,  this  bill
would  include  provisions  governing  the redomestication of a domestic
insurance company to another state upon the approval of the  Superinten-
dent  of  Insurance. Upon approval of redomestication by the Superinten-
dent, the transferring company would be authorized to transact  business
in  New York State as a foreign company, provided that the insurer meets
all of the requirements for operation as a foreign company Such  company
could continue to utilize policy forms previously approved by the Super-
intendent  for their use as a domestic insurer, with the proper endorse-
ments

EXISTING LAW: Currently, � 7120 only contains the provisions of the NAIC
Model relating to the transfer to this state of the  corporate  domicile
of an authorized foreign company

JUSTIFICATION:  This  bill will improve the efficiency of the regulation
and oversight of affiliated groups of insurance companies  domiciled  in
multiple  states  and  will  help  to preserve the continuation of state
regulation of insurance. Forty-one states have adopted a version of  the
NAIC  Redomestication  Model  Act,  which provides for a redomestication
process which is efficient, effective and not unduly cumbersome New York
State has not adopted the provisions of the Model Act  relating  to  the
transfer of a domestic insurer to another state and, thus, under current
New  York law, the process for consolidating affiliates is a very diffi-
cult, time consuming and cumbersome one By adopting the balance  of  the
NAIC  Redomestication  Model  Bill.  this  legislation will also further
uniformity among states relative to the regulation of  insurance  compa-
nies and would make the current state-based system for the regulation of
insurance  companies  more efficient. As the threat of the federal regu-
lation of the insurance industry continues to loom, it is important that
states demonstrate their ability to work together and adopt uniform laws
where such laws would provide  for  the  more  effective  regulation  of
insurance  companies.  The  enactment  of this legislation would further
this goal.

LEGISLATIVE HISTORY: S.3366 of 2011-12

FISCAL IMPLICATIONS: None

EFFECTIVE DATE: Immediately

S3543-2013 Text

 S T A T E   O F   N E W   Y O R K
 
 
                                         3543
 2013-2014 Regular Sessions
 I N  SENATE
 February 5, 2013
 
 Introduced  by  Sen.  SEWARD -- read twice and ordered printed, and when
 printed to be committed to the Committee on Insurance
 

AN ACT to amend the insurance law, in relation to the redomestication of
 insurance companies
 THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section 1.

Section 7120 of the insurance law, as amended by chapter 48
 of the laws of 2009, is amended to read as follows:

 

S  7120.  Redomestication  of [foreign] insurance companies. (a) Defi
 nitions.  In this section:

 (1) "Redomestication" means the transfer to this state of  the  corpo
 rate domicile of an authorized foreign company OR THE TRANSFER FROM THIS
 STATE  OF  THE CORPORATE DOMICILE OF A DOMESTIC COMPANY, as provided for
 in this section.
 (2) "Transferring company"  means  any  authorized  [foreign]  company
 seeking redomestication.
 (b) A transferring company TRANSFERRING TO THIS STATE shall:

 (1)  file  with  the  superintendent  a  certificate  in  such form as
 prescribed by the superintendent signed  by  the  insurance  supervisory
 official  of  the  state  where  such  transferring company is domiciled
 approving the proposed redomestication and confirming that upon redomes
 tication the transferring company shall no longer be subject as a domes
 tic company to the requirements of its current state of domicile;
 (2) comply with the applicable requirements of this chapter  regarding
 the organization and licensing of a domestic company of the same type;
 (3)  demonstrate  to  the satisfaction of the superintendent that upon
 redomestication, the transferring company will be in compliance with the
 requirements of this chapter and any regulations promulgated  thereunder
 applicable to a domestic company of the same type;
 (4)  submit  to the superintendent all documents and filings necessary
 to comply with paragraphs two and three of this subsection; and
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD08120-01-3
 
       S. 3543                             2
 (5) submit new policy forms to the superintendent for use after  redo
 mestication, if so ordered by the superintendent, or use existing policy
 forms with appropriate endorsements if allowed by, and under such condi
 tions as approved by, the superintendent.
 (c) A TRANSFERRING COMPANY TRANSFERRING FROM THIS STATE:

 (1)  UPON THE APPROVAL OF THE SUPERINTENDENT, TRANSFER ITS DOMICILE TO
 ANY OTHER STATE IN WHICH IT IS ADMITTED  TO  TRANSACT  THE  BUSINESS  OF
 INSURANCE,  AND  UPON  SUCH  A  TRANSFER IT SHALL CEASE TO BE A DOMESTIC
 COMPANY, AND SHALL BE AUTHORIZED IN  THIS  STATE,  IF  QUALIFIED,  AS  A
 FOREIGN  INSURER.   THE SUPERINTENDENT SHALL APPROVE THE TRANSFER UNLESS
 HE OR SHE DETERMINES THE TRANSFER IS NOT IN THE INTEREST OF THE  POLICY
 HOLDERS OF THIS STATE; AND
 (2)  MAY CONTINUE ISSUING POLICY FORMS APPROVED BEFORE REDOMESTICATION
 PURSUANT TO SECTION THREE THOUSAND TWO HUNDRED ONE OF THIS CHAPTER  WITH
 SUCH  ENDORSEMENT, IF ANY, AS THE SUPERINTENDENT DETERMINES IS NEEDED TO
 REFLECT THE REDOMESTICATION.
 (D) After the transferring company has complied with the provisions of
 this section, the superintendent may, in  accordance  with  section  one
 thousand  one  hundred  two  of  this chapter issue a new license to the
 transferring company to reflect the change in  its  state  of  corporate
 domicile.  The  duration of its license shall be governed by section one
 thousand one hundred three of this chapter. Upon issuance  of  such  new
 license  the redomestication shall become effective and the transferring
 company  shall  be  a  domestic  company  OR  A  FOREIGN   COMPANY,   AS
 APPROPRIATE.
 [(d)] (E) Simultaneous with the redomestication taking effect:

 (1) all materials and documents that were submitted to the superinten
 dent  by  the  transferring company pursuant to the requirements of this
 section shall be filed in the office of the  superintendent  SUBJECT  TO
 SUBSECTION (H) OF THIS SECTION; and
 (2)  FOR A TRANSFERRING COMPANY TRANSFERRING TO THIS STATE, the super
 intendent shall, in accordance with section one thousand two hundred one
 or other applicable provisions of this chapter issue to  the  company  a
 certified  copy  of its new declaration and charter and a certificate of
 incorporation. The new charter  of  the  company  may  provide  for  the
 continuation  of the corporate existence of the transferring company and
 in such case the original date  of  incorporation  of  the  transferring
 company shall be the date of incorporation of the new domestic company.
 [(e)]  (F)  All  outstanding  insurance  policies  and contracts shall
 remain in full force and effect with no change and need not be  endorsed
 as  to  the  new name of the company, if any, or its new location unless
 ordered by the superintendent.
 [(f)] (G) All agents' appointments  and  licenses,  rates,  and  other
 items that the superintendent allows, existing at the time of redomesti
 cation,  shall  continue  in  full  force  and effect in accordance with
 applicable provisions of this chapter.
 (H) THE SUPERINTENDENT SHALL KEEP THE CONTENTS OF ANY REPORT OR INFOR
 MATION THE SUPERINTENDENT REQUIRES PURSUANT TO THIS SECTION, AND THAT IS
 NOT OTHERWISE REQUIRED TO BE SET FORTH IN A PUBLICLY AVAILABLE REPORT OR
 FILING, CONFIDENTIAL IN ACCORDANCE WITH THE PROVISIONS OF SUBSECTION (C)
 OF SECTION ONE THOUSAND FIVE HUNDRED FOUR OF THIS CHAPTER.
 

S 2. This act shall take effect immediately.

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