N.Y. Comp. Codes R. & Regs. tit. 11 § 390.11

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

Section 390.11 - Net worth option

A service contract provider that elects to meet the requirements of section 7903(c)(3) of the Insurance Law as the means to assure the faithful performance of its obligations under service contracts outstanding in this State shall comply with the provisions of this section.

(a) Audited financial statements.

(1) On or before June 30th of each year or 180 days after the end of the service contract provider's fiscal year, whichever is later, the service contract provider shall file its audited financial statements for the prior calendar year with the superintendent. If the audited financial statements of the provider's parent or indirect parent are used to meet the provider's financial responsibility requirement, then the parent or indirect parent shall file the statements and the 180 days shall be counted from the parent's or indirect parent's fiscal year. The statements shall include an opinion of an independent certified public accountant. The statement and opinion shall be mailed or delivered to the superintendent at the following address:

New York State Insurance Department

Property Bureau--Service Contract Providers

25 Beaver Street

New York, NY 10004-2359

(2) If, at any time, the certified public accountant or the service contract provider determines that the provider, or the provider's parent or indirect parent, has materially misstated its financial condition as reported to the superintendent, the provider shall submit the determination to the superintendent, in writing within 15 days following the determination.

(b) If the statements of the service contract provider's parent or indirect parent are used to meet the provider's financial responsibility requirement, then the parent or indirect parent shall guarantee the provider's obligations relating to the service contracts sold by the provider in this State. The provider shall mail or deliver the guarantee to the superintendent with the registration application at the following address:

New York State Insurance Department

Licensing Bureau--Registration Unit

One Commerce Plaza

Albany, NY 12257

(c) If the contract provider's registration is suspended for more than 60 days, revoked, or otherwise terminated for any reason, and it has service contracts that have been issued and are outstanding in this State, the contract provider will immediately transfer to the superintendent an amount equal to the minimum required by section 7903(c)(2) of the Insurance Law and section 390.10 of this Part for the funded reserve account and trust fund, for safekeeping and for the use and protection of contract holders and administration of claims. The contract provider shall submit a written affirmation to the superintendent at the time of registration that it shall so transfer the funds.

N.Y. Comp. Codes R. & Regs. Tit. 11 § 390.11