S.D. Admin. R. 20:06:30:17

Current through Register Vol. 51, page 67, December 16, 2024

Section 20:06:30:17 - Requirements at inception date and on an on-going basis-Remediation

The requirements of § 20:06:30:16 must be satisfied as of the date that risks under a covered policy is ceded, if that date is on or after the effective date of §§ 20:06:30:13 to 20:06:30:20, inclusive, and on an ongoing basis thereafter. Under no circumstances shall a ceding insurer take or consent to any action or series of actions that would result in a deficiency under subdivision 20:06:30:16(3) or 20:06:30:16(4) with respect to any reinsurance treaty under which a covered policy has been ceded, and in the event that a ceding insurer becomes aware at any time that a deficiency exists, it shall use its best efforts to arrange for the deficiency to be eliminated as expeditiously as possible.

Prior to the due date of each quarterly or annual statement, each life insurance company that has ceded reinsurance within the scope of chapter § 20:06:30 shall perform an analysis, on a treaty-by-treaty basis, to determine, as to each reinsurance treaty under which covered policy has been ceded, whether as of the end of the immediately preceding calendar quarter (the valuation date) the requirements of subdivisions 20:06:30:16(3) or 20:06:30:16(4) are satisfied. The ceding insurer shall establish a liability equal to the excess of the credit for reinsurance taken over the amount of primary security actually held pursuant to subdivision 20:06:30:16(3), unless either:

(1) The requirements of subdivision 20:06:30:16(3) or 20:06:30:16(4) were fully satisfied as of the valuation date as to the reinsurance treaty; or

(2) Any deficiency has been eliminated before the due date of the quarterly or annual statement to which the valuation date relates through the addition of primary security and/or other security, as the case may be, in such amount and form as would have caused the requirements of subdivision 20:06:30:16(3) or 20:06:30:16(4) to be fully satisfied as of the valuation date.

Nothing in this section shall be construed to allow a ceding company to maintain any deficiency under subdivision 20:06:30:16(3) or 20:06:30:16(4) for any period of time longer than is reasonably necessary to eliminate it.

S.D. Admin. R. 20:06:30:17

49 SDR 009, effective 8/9/2022

General Authority: SDCL 58-14-17.

Law Implemented: SDCL 58-14-17.