As used in the Oklahoma Captive Insurance Company Act:

1. 1. "Alien captive insurance company" means an insurance company formed to write insurance business for its parents and affiliates and licensed pursuant to the laws of an alien jurisdiction which imposes statutory or regulatory standards in a form acceptable to the Insurance Commissioner on companies transacting the business of insurance in such jurisdiction;
2. 2. "Affiliated company" means a company in the same corporate system as a parent, an industrial insured, or a member organization by virtue of common ownership, control, operation, or management;

3. 3. "Association" means a legal association of individuals, corporations, partnerships, or associations that has been in continuous existence for at least one (1) year:

   1. a. the member organizations of which collectively, or which does itself:

      1. (1) own, control, or hold with power to vote all of the outstanding voting securities of an association captive insurance company incorporated as a stock insurer, or
      2. (2) have complete voting control over an association captive insurance company incorporated as a mutual insurer, or
   2. b. the member organizations of which collectively constitute all of the subscribers of an association captive insurance company formed as a reciprocal insurer;
4. 4. "Association captive insurance company" means a company that insures risks of the member organizations of the association and their affiliated companies;
5. 5. "Branch business" means any insurance business transacted by a branch captive insurance company in this state;
6. 6. "Branch captive insurance company" means an alien captive insurance company licensed by the Insurance Commissioner to transact the business of insurance in this state through a business unit with a principal place of business in this state;
7. 7. "Branch operations" means any business operations of a branch captive insurance company in this state;
8. 8. "Captive insurance company" means a pure captive insurance company, association captive insurance company, captive reinsurance company, sponsored captive insurance company, special purpose captive insurance company, or industrial insured captive insurance company formed or licensed under the Oklahoma Captive Insurance Company Act. For purposes of the Oklahoma Captive Insurance Company Act, a branch captive insurance company must be a pure captive insurance company with respect to operations in this state, unless otherwise permitted by the Insurance Commissioner;
9. 9. "Captive reinsurance company" means a reinsurance company that is formed or licensed pursuant to the Oklahoma Captive Insurance Company Act and is wholly owned by a qualifying reinsurance parent company. A captive reinsurance company is a stock corporation;
10. 10. "Consolidated debt to total capital ratio" means the ratio of the sum of all debts and hybrid capital instruments including, but not limited to, all borrowings from banks, all senior debt, all subordinated debts, all trust preferred shares, and all other hybrid capital instruments that are not included in the determination of consolidated GAAP new worth issued and outstanding to total capital, consisting of all debts and hybrid capital instruments described in this paragraph plus equity of the shareholders determined in accordance with GAAP for reporting to the United States Securities and Exchange Commission;
11. 11. "Consolidated GAAP net worth" means the consolidated shareholders’ equity determined in accordance with GAAP for reporting to the United States Securities and Exchange Commission;

12. 12. "Controlled unaffiliated business" means a company:

    1. a. that is not in the corporate system of a parent and affiliated companies,
    2. b. that has an existing contractual relationship with a parent or affiliated company, and
    3. c. whose risks are managed by a pure captive insurance company in accordance with Section 34 of this act;
13. 13. "Insurance Commissioner" means the Insurance Commissioner of the State of Oklahoma or designee of the Insurance Commissioner;
14. 14. "Department" means the Oklahoma Department of Insurance;
15. 15. "GAAP" means generally accepted accounting principles;
16. 16. "Industrial insured" means an insured insured under industrial life insurance as defined in Section 4202 of Title 36 of the Oklahoma Statutes;
17. 17. "Industrial insured captive insurance company" means a company that insures risks of the industrial insureds that comprise the industrial insured group and their affiliated companies;

18. 18. "Industrial insured group" means a group that meets either of the following criteria:

    1. a. a group of industrial insureds that collectively:

       1. (1) owns, controls, or holds with power to vote all of the outstanding voting securities of an industrial insured captive insurance company incorporated as a stock insurer, or
       2. (2) has complete voting control over an industrial insured captive insurance company incorporated as a mutual insurer, or
    2. b. a group which is created under the Liability Risk Retention Act of 1986, 15 U.S.C., Section 3901 et seq., as amended, as a corporation or other limited liability association taxable as a stock insurance company or a mutual insurer under this title;
19. 19. "Member organization" means any individual, corporation, partnership, or association that belongs to an association;
20. 20. "Parent" means any corporation, partnership, or individual that directly or indirectly owns, controls, or holds with power to vote more than fifty percent (50%) of the outstanding voting securities of a pure captive insurance company;
21. 21. "Participant" means an entity as defined in Section 38 of this act, and any affiliates of that entity, that are insured by a sponsored captive insurance company, where the losses of the participant are limited through a participant contract to the assets of a protected cell;
22. 22. "Participant contract" means a contract by which a sponsored captive insurance company insures the risks of a participant and limits the losses of the participant to the assets of a protected cell;
23. 23. "Protected cell" means a separate account established and maintained by a sponsored captive insurance company for one participant;
24. 24. "Pure captive insurance company" means a company that insures risks of its parent, affiliated companies, controlled unaffiliated business, or a combination thereof;
25. 25. "Qualifying reinsurer parent company" means a reinsurer authorized to write reinsurance by this state and that has a consolidated GAAP net worth of not less than Five Hundred Million Dollars ($500,000,000.00) and consolidated debt to total capital ratio not greater than 0.50;
26. 26. "Special purpose captive insurance company" means a captive insurance company that is formed or licensed under the Oklahoma Insurance Code that does not meet the definition of any other type of captive insurance company defined in this section;
27. 27. "Sponsor" means an entity that meets the requirements of Section 37 of this act and is approved by the Insurance Commissioner to provide all or part of the capital and surplus required by applicable law and to organize and operate a sponsored captive insurance company;

28. 28. "Sponsored captive insurance company" means a captive insurance company:

    1. a. in which the minimum capital and surplus required by applicable law is provided by one or more sponsors,
    2. b. that is formed or licensed under the Oklahoma Captive Insurance Company Act,
    3. c. that insures the risks of separate participants through the contract, and
    4. d. that segregates the liability of each participant through one or more protected cells; and
29. 29. "Treasury rates" means the United States Treasury strips asked yield as published in the Wall Street Journal as of a balance sheet date.

Laws 2004, HB 2141, c. 334, § 9, emerg. eff. May 25, 2004.