House Bill 920 Summary

• Defines "enterprise risk" as any activity or circumstance involving affiliates that could materially adversely affect an insurer's financial condition or liquidity, including situations that would trigger risk-based capital company action level or hazardous financial condition status.

• Expands registration statement requirements to include dividends and distributions to shareholders, consolidated tax allocation agreements, stock pledges for affiliate loans, and board governance statements affirming oversight of corporate governance and internal controls.

• Requires the ultimate controlling person to file an annual enterprise risk report identifying material risks within the insurance holding company system that could pose enterprise risk to the insurer, filed with the lead state commissioner.

• Establishes that disclaimers of affiliation are deemed granted unless the commissioner disallows within 30 days, and creates new requirements for notice of proposed divestitures and approval determinations for acquiring or divesting controlling interests.

• Creates new standards for management of domestic insurers requiring independent directors (at least one-third of board and committees), establishes independent nominating and officer evaluation committees, and exempts insurers with less than $300 million in annual direct written premium from these requirements upon application to the commissioner.