N.Y. Comp. Codes R. & Regs. Tit. 11 §§ 18-1.2

Current through Register Vol. 46, No. 50, December 11, 2024

Section 18-1.2 - General provisions

(a) Except as hereinafter provided and subject to section 425-a of the Insurance Law, any person, firm, corporation or other entity may become an underwriting member. However, no insurer licensed under the laws of this State, any other state, territory or possession of the United States, or under the laws of a foreign country, shall become an underwriting member of the exchange. Nothing contained herein, however, shall prohibit any such insurer from owning the stock of a corporation which is an underwriting member or of a corporation which is a partner in an underwriting member of the exchange, subject to the applicable provisions of the Insurance Law.

(b)

(1) No rule, regulation or plan of operation of the Security Fund shall become effective unless a copy of said rule, regulation or plan of operation has been submitted to the superintendent at least 30 days prior thereto, or such shorter period as he may permit, and he has not disapproved it within such period.

(2) In the reporting of data for the annual statement pursuant to section 26 of the Insurance Law, underwriting members shall use statutory insurance accounting principles.

(c) Whenever the term insurer, insurance company or corporation appears in the Insurance Law, it shall apply to an underwriting member. Any underwriting member shall be deemed a domestic insurer as defined in subdivision 15, section 4 of the Insurance Law for the purposes of the application of the provisions of the Insurance Law and related statutes, and this Part.

(d)

(1) The term insurance contract as defined in subdivision 1 of section 41 of the Insurance Law shall be deemed to include an exchange contract as referred to in section 1, article IX of the constitution. However, in no event shall the exchange be a party to an exchange contract or have any liability thereunder.

(2) The term doing an insurance business as defined in subdivision 3 of section 41 of the Insurance Law shall be deemed to include the making of, or proposing to make, an exchange contract.

(e) Whenever the terms license, licensee, or licensed appear in the Insurance Law in reference to insurers, such terms shall be deemed to apply to an underwriting member approved by the board pursuant to section 7, article VII of the constitution.

(f) Notwithstanding the exemptions from the Insurance Law granted hereinafter, any business underwritten pursuant to subdivision 1 (a) (iii) of section 425-a of the Insurance Law shall be subject to all applicable provisions of the Insurance Law, except as provided under section 168-d thereof and Insurance Department Regulation No. 86 (11 NYCRR Part 16).

(g) The prohibition contained in section 18-1.3(a)(5)(ii) of this Subpart shall be applicable to any person, firm, corporation or other entity who or which is a member, associate broker, underwriting manager or subscriber of the exchange.

(h)

(1) An underwriting member authorized by the exchange to write the kinds of insurance other than life and annuities shall be deemed a casualty insurance company and a surety company within the meaning of section 310, a fire insurance company and a marine insurance company within the meaning of section 340, and an accident and health company within the meaning of subdivision 2 of section 190 of the Insurance Law, as applicable, and shall be known as a property and casualty syndicate. Except with respect to life insurance and annuities, title insurance, mortgage guaranty insurance and life of property insurance, such syndicate may reinsure risks of every kind or description and may write any and all kinds of insurance on risks outside of the United States, its territories or possessions.

(2) An underwriting member authorized to write life insurance, annuities and accident and health insurance shall be deemed a life insurance company within the meaning of subdivision 1 of section 190 of the Insurance Law and shall be known as a life syndicate.

(3) An underwriting member authorized to write all the kinds of insurance specified in paragraphs (1) and (2) of this subdivision shall be known as a life and property and casualty syndicate.

(4) An underwriting member shall provide the initial paid-in capital and surplus and thereafter maintain the minimum surplus to policyholders as required pursuant to section 6, article VII of the constitution. The surplus to policyholders of an underwriting member which is a stock corporation authorized to transact business as a property and casualty syndicate or or as a life syndicate shall at all times include a paid-in capital of at least $500,000; if authorized to transact business as a life and property and casualty syndicate, $1,000,000.

(5) After satisfying the requirements for minimum capital investments specified in section 18-1.3 of this Subpart, a life and property and casualty syndicate shall invest its life department reserves and liabilities only as provided in section 80(1)(a) of the Insurance Law.

(i) The provisions of subdivisions 1 and 2 of section 26, subdivisions 1 and 2(a) of section 28, section 29, and article XVI of the Insurance Law shall apply to the exchange, the Security Fund and to any other corporation established by the exchange.

(j) Any request made pursuant to section 27 of the Insurance Law shall be directed to the exchange except where the superintendent deems a direct request to the member necessary, in which case a copy of such request will be sent to the exchange.

(k)

(1) Notwithstanding the provisions of sections 110, 113, and 115 of the Insurance Law, a person acting as an underwriting manager or deupty thereof pursuant to the authority conferred by section 3, article IX of the Constitution shall not be required to obtain a license to act as an insurance agent.

(2)

(i) Notwithstanding the provisions of subdivision 9 of section 46-a and subdivision 7 of section 85-a of the Insurance Law, an insurer authorized in this State may act as an underwriting manager of an underwriting member or underwriting members.

(ii) An insurer not authorized in this State may become an underwriting manager of an underwriting member only upon such underwriting member's application to the superintendent and his written approval thereof.

(iii) No insurer may act as an underwriting manager of an underwriting member unless so designated by the exchange pursuant to section 3, article IX of the Constitution.

(iv) Any insurer approved by the exchange as an underwriting manager must maintain books and records which separately account for such business.

N.Y. Comp. Codes R. & Regs. Tit. 11 §§ 18-1.2