CT HB05484

Reorganizes and expands reinsurance credit requirements for domestic ceding insurers, establishing six pathways for credit eligibility based on the reinsurer's licensing, accreditation, or certification status, effective October 1, 2012.

Creates a new "certified reinsurer" classification requiring domiciliation in a qualified jurisdiction, minimum capital and surplus, financial strength ratings from acceptable rating agencies, and agreements to submit to state jurisdiction and provide security for obligations.

Establishes different security requirements based on certified reinsurer ratings, with multibeneficiary trusts requiring minimum trusteed surplus of $10 million (versus $20 million for single insurers), and allows commissioners to authorize surplus reductions after three years of discontinued underwriting.

Implements reinsurance management requirements requiring domestic ceding insurers to notify the commissioner when reinsurance recoverables from any single assuming insurer exceed 50% of surplus or when ceded premiums exceed 20% of gross written premiums.

Revises definitions of "qualified United States financial institution" for trust purposes and establishes procedures for suspension, revocation, and inactive status of accredited and certified reinsurers, with appeal rights to policyholders and ceding insurers.