(a) Pursuant to Arkansas Code § 23-62-305(b), the Insurance Commissioner shall allow credit for reinsurance ceded by a domestic insurer to an assuming insurer that as of any date on which statutory financial statement credit for reinsurance is claimed:

1. (1) Is domiciled in (or, in the case of a United States branch of an alien assuming insurer, is entered through) a state that employs standards regarding credit for reinsurance substantially similar to those applicable under the Arkansas Credit for Reinsurance Law, Arkansas Code § 23-62-301 et seq., and this part;
2. (2) Maintains a surplus as regards policyholders in an amount not less than twenty million dollars ($20,000,000); and
3. (3) Files a properly executed Form AR-1 with the Insurance Commissioner as evidence of its submission to this state’s authority to examine its books and records.

(b)

1. (1) The provisions of this section relating to surplus as regards policyholders shall not apply to reinsurance ceded and assumed pursuant to pooling arrangements among insurers in the same holding company system.
2. (2) As used in this section, “substantially similar” standards means credit for reinsurance standards that the Insurance Commissioner determines are equal to or exceed the standards of the Arkansas Credit for Reinsurance Law, Arkansas Code § 23-62-301 et seq., and this part.