S.C. Code Ann. Regs. 69-14
Section I. Forms-General Requirements.
D. Statements should be prepared electronically. Statements shall be easily readable and suitable for review and reproduction. Debits in credit categories and credits in debit categories shall be designated so as to be clearly distinguishable as such on photocopies. Statements shall be in the English language and monetary values shall be stated in United States currency. If any exhibit or other paper or document filed with the statement is in a foreign language, it shall be accompanied by a translation into the English language and any monetary value normally shown in foreign currency shall be converted into United States currency.
Section II. Forms-Incorporation by Reference, Summaries and Omissions.
B. Where an item requires a summary or outline of the provisions of any document, only a brief statement shall be made as to the pertinent provisions of the document. In addition to such statement, the summary or outline may incorporate by reference particular parts of any exhibit or document currently on file with the director or his designee which was filed within three years and may be qualified in its entirety by such reference. In any case where two or more documents required to be filed as exhibits are substantially identical in all material respects except as to the parties thereto, the dates of execution, or other details, a copy of only one of such documents need be filed with a schedule identifying the omitted documents and setting forth the material details in which such documents differ from the documents a copy of which is filed.
Section III. Forms-Information Unknown or Unavailable and Extension of Time to Furnish.
If it is impractical to furnish any required information, document or report at the time it is required to be filed, there shall be filed with the director or his designee a separate document:
C. requesting an extension of time for filing the information, document or report to a specified date. The request for extension shall be deemed granted unless the director or his designee within sixty days after receipt thereof enters an order denying the request.
Section IV. Forms-Additional Information and Exhibits.
In addition to the information expressly required to be included in Form A, Form B, Form C, Form D, Form E and Form F there shall be added such further material information, if any, as may be necessary to make the information contained therein not misleading. The person filing may also file such exhibits as it may desire in addition to those expressly required by the statement. Such exhibits shall be so marked as to indicate clearly the subject matter to which they refer. Changes to Forms A, B, C, D, E or F shall include on the top of the cover page the phrase: “Change No. (insert number) to” and shall indicate the date of the change and not the date of the original filing.
Section V. Definitions.
D. Unless the context otherwise requires, other terms found in these regulations and in South Carolina Code Section 38-21-10 are used as defined in Section 38-21-10. Other nomenclature or terminology is defined according to Title 38 of the South Carolina Code, or industry usage if not defined by Title 38 of the South Carolina Code.
Section VI. Subsidiaries of Domestic Insurers.
The authority to invest in subsidiaries under South Carolina Code Section 38-21-30 is in addition to any authority to invest in subsidiaries which may be contained in any other provision of Title 38 of the Code.
Section VII. Acquisition of Control-Statement Filing.
A person required to file a statement pursuant to South Carolina Code Sections 38-21-60 and 38-21-70 shall furnish the required information on Form A, hereby made a part of this regulation. Such person shall also furnish the required information on Form E, hereby made a part of this regulation and described in Section X of this regulation.
Section VIII. Amendments to Form A.
The applicant shall promptly advise the Director of any changes in the information so furnished on Form A arising subsequent to the date upon which such information was furnished but prior to the Director’s disposition of the application.
Section IX. Acquisition of Section 38-21-60 Insurers.
B. Where a Section 38-21-60 insurer is being acquired, references to “the insurer” contained in Form A shall refer to both the domestic subsidiary insurer and the person being acquired.
Section X. Pre-Acquisition Notification.
If a domestic insurer, including any person controlling a domestic insurer, is proposing a merger or acquisition pursuant to South Carolina Code Section 38-21-60, that person shall file a pre-acquisition notification form, Form E, which was developed pursuant to South Carolina Code Section 38-21-125(C)(2). Additionally, if a non-domiciliary insurer licensed to do business in this state is proposing a merger or acquisition pursuant to South Carolina Code Section 38-21-125, that person shall file a pre-acquisition notification form, Form E. No pre-acquisition notification form need be filed if the acquisition is beyond the scope of South Carolina Code Section 38-21-125 as set forth in South Carolina Code Section 38-21-125(B)(2). In addition to the information required by Form E, the Director may wish to require an expert opinion as to the competitive impact of the proposed acquisition.
Section XI. Annual Registration of Insurers-Statement Filing.
An insurer required to file an annual registration statement pursuant to South Carolina Code Sections 38-21-130 and 38-21-140 shall furnish the required information on Form B, hereby made a part of these regulations.
Section XII. Summary of Registration-Statement Filing.
An insurer required to file an annual registration statement pursuant to Sections 38-21-130 and 38-21-140 is also required, under Section 38-21-150, to furnish information specified on Form C, hereby made a part of these regulations.
Section XIII. Amendments to Form B.
B. Amendments shall be filed in the Form B format with only those items which are being amended reported. Each amendment shall include at the top of the cover page “Amendment No [insert number] to Form B for [insert year]” and shall indicate the date of the change and not the date of the original filing.
Section XIV. Alternative and Consolidated Registrations.
A. Any authorized insurer may file a registration statement on behalf of any affiliated insurer or insurers which are required to register under Section 38-21-130. A registration statement may include information not required by law regarding any insurer in the insurance holding company system even if such insurer is not authorized to do business in this State. In lieu of filing a registration statement on Form B, the authorized insurer may file a copy of the registration statement or similar report which it is required to file in its state of domicile, provided:
D. Any authorized insurer may utilize the provisions of Sections 38-21-200 and 38-21-210 without obtaining prior approval of the director or his designee. The director or his designee, however, reserves the right to require individual filings if he deems such filings necessary in the interest of clarity, ease of administration or the public good.
Section XV. Disclaimers of Affiliation and Termination of Registration.
A. A disclaimer of affiliation or a request for termination of registration claiming that a person does not, or will not upon the taking of some proposed action, control another person (hereinafter referred to as the “subject”) shall contain the following information:
B. A request for termination of registration shall be deemed to have been granted unless the Director, within thirty days after he receives the request, notifies the registrant otherwise.
Section XVI. Transactions Subject to Prior Notice-Notice Filing.
An insurer required to give notice of a proposed transaction pursuant to South Carolina Code Section 38-21-250 shall furnish the required information on Form D, hereby made a part of these regulations.
A. Agreements for cost sharing services and management services shall at a minimum and as applicable:
7. Specify that all books and records of the insurer are and remain the property of the insurer and are subject to control of the insurer;
11. Specify that, if the insurer is placed in receivership or seized by the director or his designee under the Insurers Rehabilitation and Liquidation Act:
15. Specify that, in furtherance of the cooperation between the receiver and the affected guaranty association(s) and subject to the receiver’s authority over the insurer, if the insurer is placed into supervision, seizure, conservatorship or receivership pursuant to S.C. Code Ann. Title 38, Chapters 26 and 27, and portions of the insurer’s policies or contracts are eligible for coverage by one or more guaranty associations, the affiliate’s commitments under Subsections XVI 11 through 14 of this regulation will extend to such guaranty association(s).
Section XVII. Enterprise Risk Report.
The ultimate controlling person of an insurer required to file an enterprise risk report pursuant to South Carolina Code Section 38-21-225 shall furnish the required information on Form F, hereby made a part of these regulations.
Section XVIII. Group Capital Calculation.
A. Where an insurance holding company system has previously filed the annual group capital calculation at least once, the lead state commissioner has the discretion to exempt the ultimate controlling person from filing the annual group capital calculation if the lead state commissioner makes a determination based upon that filing that the insurance holding company system meets all of the following criteria:
B. Where an insurance holding company system has previously filed the annual group capital calculation at least once, the lead state commissioner has the discretion to accept in lieu of the group capital calculation a limited group capital filing if:
(1) The insurance holding company system has annual direct written and unaffiliated assumed premium (including international direct and assumed premium), but excluding premiums reinsured with the Federal Crop Insurance Corporation and Federal Flood Program, of less than $1,000,000,000; and all of the following additional criteria are met:
C. For an insurance holding company that has previously met an exemption with respect to the group capital calculation pursuant Section XVIII A or XVIII B of this regulation, the lead state commissioner may require at any time the ultimate controlling person to file an annual group capital calculation, completed in accordance with the NAIC Group Capital Calculation Instructions, if any of the following criteria are met:
D. A non-U.S. jurisdiction is considered to “recognize and accept” the group capital calculation if it satisfies the following criteria:
(1) With respect to Section 38-21-80(L)(2)(d):
E. A list of non-U.S. jurisdictions that “recognize and accept” the group capital calculation will be published through the NAIC Committee Process:
(4) Upon determination by the lead state commissioner that a non-U.S. jurisdiction no longer meets one or more of the requirements to “recognize and accept” the group capital calculation, the lead state commissioner may provide a recommendation to the NAIC that the non-U.S. jurisdiction be removed from the list of jurisdictions that “recognize and accepts” the group capital calculation.
Section XIX. Extraordinary Dividends and Other Distributions.
A. Requests for approval of extraordinary dividends or any other extraordinary distribution to shareholders shall include the following:
(4) A copy of the calculations determining that the proposed dividend is extraordinary. The work paper shall include the following information:
B. Subject to Section 5B of the Act, each registered insurer shall report to the Commissioner all dividends and other distributions to shareholders within fifteen (15) business days following the declaration thereof, including the same information required by Subsection A(4).
(c) Furnish a chart or listing clearly presenting the identities of the inter-relationships among the applicant and all affiliates of the applicant. Indicate in such chart or listing the percentage of voting securities of each such person which is owned or controlled by the applicant or by any other such person. If control of any person is maintained other than by the ownership or control of voting securities, indicate the basis of such control. As to each person specified in such chart or listing indicate the type of organization (e.g. corporation, trust, partnership) and the state or other jurisdiction of domicile. If court proceedings involving a reorganization or liquidation are pending with respect to any such person, indicate which person, and set forth the title of the court, nature of proceedings and the date when commenced.
ITEM 3. IDENTITY AND BACKGROUND OF INDIVIDUALS ASSOCIATED WITH THE APPLICANT.
On the biographical affidavit, include a third party background check, and state the following with respect to (1) the applicant if (s)he is an individual or (2) all persons who are directors, executive officers or owners of 10% or more of the voting securities of the applicant if the applicant is not an individual.
(d) Whether or not such person has ever been convicted in a criminal proceeding (excluding minor traffic violations) during the last ten years and, if so, give the date, nature of conviction, name and location of court, and penalty imposed or other disposition of the case.
ITEM 4. NATURE, SOURCE AND AMOUNT OF CONSIDERATION.
(c) If the source of the consideration is a loan made in the lender’s ordinary course of business and if the applicant wishes the identity of the lender to remain confidential, he must specifically request that the identity be kept confidential.
ITEM 5. FUTURE PLANS OF INSURER.
Describe any plans or proposals which the applicant may have to declare an extraordinary dividend, to liquidate such insurer, to sell its assets to or merge it with any person or persons or to make any other material change in its business operations or corporate structure or management.
ITEM 6. VOTING SECURITIES TO BE ACQUIRED.
State the number of shares of the insurer’s voting securities which the applicant, its affiliates and any person listed in Item 3 plan to acquire, and the terms of the offer, request, invitation, agreement or acquisition, and a statement as to the method by which the fairness of the proposal was arrived at.
ITEM 7. OWNERSHIP OF VOTING SECURITIES.
State the amount of each class of any voting security of the insurer which is beneficially owned or concerning which there is a right to acquire beneficial ownership by the applicant, its affiliates or any person listed in Item 3.
ITEM 8. CONTRACTS, ARRANGEMENTS, OR UNDERSTANDING WITH RESPECT TO VOTING SECURITIES OF THE INSURER.
Give a full description of any contracts, arrangements or understandings with respect to any voting security of the insurer in which the applicant, its affiliates or any person listed in Item 3 is involved, including but not limited to transfer of any of the securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or guarantees of profits, division of losses or profits, or the giving or withholding of proxies. Such description shall identify the person with whom such contracts, arrangements or understandings have been entered into.
ITEM 9. RECENT PURCHASES OF VOTING SECURITIES.
Describe any purchases of any voting securities of the insurer by the applicant, its affiliates or any person listed in Item 3 during the twelve calendar months preceding the filing of this statement. Include in such description the dates of purchase, the names of the purchasers, and the consideration paid or agreed to be paid therefor. State whether any such shares so purchased are hypothecated.
ITEM 10. RECENT RECOMMENDATIONS TO PURCHASE.
Describe any recommendations to purchase any voting security of the insurer made by the applicant, its affiliates or any person listed in Item 3, or by anyone based upon interviews or at the suggestion of the applicant, its affiliates or any person listed in Item 3 during the twelve calendar months preceding the filing of this statement.
ITEM 11. AGREEMENTS WITH BROKER-DEALERS.
Describe the terms of any agreement, contract or understanding made with any broker-dealer as to solicitation of voting securities of the insurer for tender and the amount of any fees, commissions or other compensation to be paid to broker-dealers with regard thereto.
ITEM 12. FINANCIAL STATEMENTS AND EXHIBITS.
(b) The financial statements shall include the annual financial statements of the persons identified in Item 2(c) for the preceding five fiscal years (or for such lesser period as such applicant and its affiliates and any predecessors thereof shall have been in existence), and similar information covering the period from the end of such person’s last fiscal year, if such information is available. Such statements may be prepared on either an individual basis, or, unless the Director otherwise requires, on a consolidated basis if such consolidated statements are prepared in the usual course of business.
The annual financial statements of the applicant shall be accompanied by the certificate of an independent public accountant to the effect that such statements present fairly the financial position of the applicant and the results of its operations for the year then ended, in conformity with generally accepted accounting principles or with requirements of insurance or other accounting principles prescribed or permitted under law. If the applicant is an insurer which is actively engaged in the business of insurance, the financial statements need not be certified, provided they are based on the Annual Statement of such person filed with the insurance department of the person’s domiciliary state and are in accordance with the requirements of insurance or other accounting principles prescribed or permitted under the law and regulations of such state.
(c) File as exhibits copies of all tender offers for, requests or invitations for, tenders of, exchange offers for, and agreements to acquire or exchange any voting securities of the insurer and (if distributed) of additional soliciting material relating thereto, any proposed employment, consultation, advisory or management contracts concerning the insurer, annual reports to the stockholders of the insurer and the applicant for the last two fiscal years, and any additional documents or papers required by Form A or Regulation 69-14.
ITEM 13. AGREEMENT REQUIREMENTS FOR ENTERPRISE RISK MANAGEMENT
Applicant agrees to provide, to the best of its knowledge and belief, the information required by Form F within fifteen (15) days after the end of the month in which the acquisition of control occurs.
ITEM 14. SIGNATURE AND CERTIFICATION.
Signature and certification required as follows:
| FORM B | |
| INSURANCE HOLDING COMPANY SYSTEM ANNUAL | |
| REGISTRATION STATEMENT | |
| Filed with the Insurance Department of the State of _________ | |
| By | |
| __________________ | |
| Name of Registrant | |
| On Behalf of Following Insurance Companies | |
| Name | Address |
| Date: _________, 20 ____ | |
| Name, Title, Address, Telephone Number and E-mail Address of Individual to Whom Notices and Correspondence Concerning This Statement Should Be Addressed: | |
ITEM 1. IDENTITY AND CONTROL OF REGISTRANT.
Furnish the exact name of each insurer registering or being registered (hereinafter called “the Registrant”), the home office address and principal executive offices of each; the date on which each Registrant became part of the insurance holding company system; and the method(s) by which control of each Registrant was acquired and is maintained.
ITEM 2. ORGANIZATIONAL CHART.
Furnish a chart or listing clearly presenting the identities of and interrelationships among all affiliated persons within the insurance holding company system. The chart or listing should show the percentage of each class of voting securities of each affiliate which is owned, directly or indirectly, by another affiliate. If control of any person within the system is maintained other than by the ownership or control of voting securities, indicate the basis of such control. As to each person specified in such chart or listing indicate the type of organization (e.g., corporation, trust, partnership) and the state or other jurisdiction of domicile.
ITEM 3. THE ULTIMATE CONTROLLING PERSON.
As to the ultimate controlling person in the insurance holding company system furnish the following information:
(g) If court proceedings involving a reorganization or liquidation are pending, indicate the title and location of the court, the nature of proceedings and the date when commenced.
ITEM 4. BIOGRAPHICAL INFORMATION.
If the ultimate controlling person is a corporation, an organization, a limited liability company, or other legal entity, furnish the following information for the directors and executive officers of the ultimate controlling person: the individual’s name and address, his or her principal occupation and all offices and positions held during the past five years, and any conviction of crimes other than minor traffic violations. If the ultimate controlling person is an individual, furnish the individual’s name and address, his or her principal occupation and all offices and positions held during the past 5 years, and any conviction of crimes other than minor traffic violations.
ITEM 5. TRANSACTIONS AND AGREEMENTS.
Briefly describe the following agreements in force, and transactions currently outstanding or which have occurred during the last calendar year between the Registrant and its affiliates:
(11) contributions by the Registrant to the surplus of an affiliate.
No information need be disclosed if such information is not material for purposes of South Carolina Code Section 38-21-160. Sales, purchases, exchanges, loans or extensions of credit, investments or guarantees involving one-half of 1% or less of the Registrant’s admitted assets as of the previous 31st day of December shall not be deemed material, unless the Director by order or regulation provides otherwise. The description shall be in a manner as to permit the proper evaluation thereof by the Director, and shall include at least the following: the nature and purpose of the transaction, the nature and amounts of any payments or transfers of assets between the parties, the identity of all parties to such transaction, and relationship of the affiliated parties to the Registrant.
ITEM 6. LITIGATION OR ADMINISTRATIVE PROCEEDINGS.
A brief description of any litigation or administrative proceedings of the following types, either then pending or concluded within the preceding fiscal year, to which the ultimate controlling person or any of its directors or executive officers was a party or of which the property of any such person is or was the subject; give the names of the parties and the court or agency in which such litigation or proceeding is or was pending:
(b) Proceedings which may have a material effect upon the solvency or capital structure of the ultimate holding company including, but not necessarily limited to, bankruptcy, receivership or other corporate reorganizations.
ITEM 7. STATEMENT REGARDING PLAN OR SERIES OF TRANSACTIONS.
The insurer shall furnish a statement that transactions entered into since the filing of the prior year’s annual registration statement are not part of a plan or series of like transactions, the purpose of which is to avoid statutory threshold amounts and the review that might otherwise occur.
ITEM 8. FINANCIAL STATEMENTS AND EXHIBITS.
(b) If the ultimate controlling person is a corporation, an organization, a limited liability company, or other legal entity, the financial statements shall include the annual financial statements of the ultimate controlling person in the insurance holding company system as of the end of the person’s latest fiscal year.
If at the time of the initial registration, the annual financial statements for the latest fiscal year are not available, annual statements for the previous fiscal year may be filed and similar financial information shall be filed for any subsequent period to the extent such information is available. Such financial statements may be prepared on either an individual basis, or unless the Director otherwise requires, on a consolidated basis if such consolidated statements are prepared in the usual course of business. Other than with respect to the foregoing, such financial statements shall be filed in a standard form and format adopted by the National Association of Insurance Commissioners, unless an alternative form is accepted by the Director or his designee. Documentation and financial statements filed with the Securities and Exchange Commission or audited GAAP financial statements shall be deemed to be an appropriate form and format.
Unless the Director otherwise permits, the annual financial statements shall be accompanied by the certificate of an independent public accountant to the effect that such statements present fairly the financial position of the ultimate controlling person and the results of its operations for the year then ended, in conformity with generally accepted accounting principles or with requirements of insurance or other accounting principles prescribed or permitted under law. If the ultimate controlling person is an insurer which is actively engaged in the business of insurance, the annual financial statements need not be certified, provided they are based on the Annual Statement of such insurer filed with the insurance department of the insurer’s domiciliary state and in accordance with requirements of insurance or other accounting principles prescribed or permitted under the law and regulations of such state.
Any ultimate controlling person who is an individual may file personal financial statements that are reviewed rather than audited by an independent public accountant. The review shall be conducted in accordance with standards for review of personal financial statements published in the Personal Financial Statements Guide by the American Institute of Certified Public Accountants. Personal financial statements shall be accompanied by the independent public accountant’s Standard Review Report stating that the accountant is not aware of any material modifications that should be made to the financial statements in order for the statements to be in conformity with generally accepted accounting principles.
(c) Exhibits shall include copies of the latest annual reports to shareholders of the ultimate controlling person and proxy material used by the ultimate controlling person and any additional documents or papers required by Form B or Regulation 69-14.
ITEM 9. FORM C REQUIRED.
A Form C, Summary of Changes to Registration Statement, must be prepared and filed with this Form B.
ITEM 10. SIGNATURE AND CERTIFICATION.
Signature and certification required as follows:
| FORM C | |
| SUMMARY OF REGISTRATION STATEMENT | |
| Filed with the Insurance Department of the | |
| State of _________ | |
| By | |
| __________________ | |
| Name of Registrant | |
| On Behalf of Following Insurance Companies | |
| Name | Address |
| Date: _________, 20 ____ | |
| Name, Title, Address, Telephone Number and E-mail Address of Individual to Whom Notices and Correspondence Concerning This Statement Should Be Addressed: |
Furnish a brief description of all items in the current annual registration statement which represent changes from the prior year’s annual registration statement. The description shall be in a manner as to permit the proper evaluation thereof by the Director, and shall include specific references to Item numbers in the annual registration statement and to the terms contained therein.
Changes occurring under Item 2 of Form B insofar as changes in the percentage of each class of voting securities held by each affiliate is concerned, need only be included where such changes are ones which result in ownership or holdings of 10 percent or more of voting securities, loss or transfer of control, or acquisition or loss of partnership interest.
Changes occurring under Item 4 of Form B need only be included where: an individual is, for the first time, made a director or executive officer of the ultimate controlling person; a director or executive officer terminates his or her responsibilities with the ultimate controlling person; or in the event an individual is named president of the ultimate controlling person.
If a transaction disclosed on the prior year’s annual registration statement has been changed, the nature of such change shall be included. If a transaction disclosed on the prior year’s annual registration statement has been effectuated, furnish the mode of completion and any flow of funds between affiliates resulting from the transaction.
The insurer shall furnish a statement that transactions entered into since the filing of the prior year’s annual registration statement are not part of a plan or series of like transactions whose purpose it is to avoid statutory threshold amounts and the review that might otherwise occur.
SIGNATURE AND CERTIFICATION
Signature and certification required as follows:
SIGNATURE
| FORM D | |
| PRIOR NOTICE OF A TRANSACTION | |
| Filed with the Insurance Department of the State of _________ | |
| By | |
| ________________________ | |
| Name of Registrant | |
| On Behalf of Following Insurance Companies | |
| Name | Address |
| Date: _________, 20 ____. | |
| Name, Title, Address, Telephone Number and E-mail Address of Individual to Whom Notices and Correspondence Concerning This Statement Should Be Addressed: |
ITEM 1. IDENTITY OF PARTIES TO TRANSACTION.
Furnish the following information for each of the parties to the transaction:
(g) Where the transaction is with a non-affiliate, the name(s) of the affiliate(s) which will receive, in whole or in substantial part, the proceeds of the transaction.
ITEM 2. DESCRIPTION OF THE TRANSACTION.
Furnish the following information for each transaction for which notice is being given:
(d) The proposed effective date of the transaction.
ITEM 3. SALES, PURCHASES, EXCHANGES, LOANS, EXTENSIONS OF CREDIT, GUARANTEES OR INVESTMENTS.
Furnish a brief description of the amount and source of funds, securities, property or other consideration for the sale, purchase, exchange, loan, extension of credit, guarantee, or investment, whether any provision exists for purchase by the insurer filing notice, by any party to the transaction, or by any affiliate of the insurer filing notice, a description of the terms of any securities being received, if any, and a description of any other agreements relating to the transaction such as contracts or agreements for services, consulting agreements and the like. If the transaction involves other than cash, furnish a description of the consideration, its cost and its fair market value, together with an explanation of the basis for evaluation.
If the transaction involves a loan, extension of credit or a guarantee, furnish a description of the maximum amount which the insurer will be obligated to make available under such loan, extension of credit or guarantee, the date on which the credit or guarantee will terminate, and any provisions for the accrual of or deferral of interest.
If the transaction involves an investment, guarantee or other arrangement, state the time period during which the investment, guarantee or other arrangement will remain in effect, together with any provisions for extensions or renewals of such investments, guarantees or arrangements. Furnish a brief statement as to the effect of the transaction upon the insurer’s surplus.
No notice need be given if the maximum amount which can at any time be outstanding or for which the insurer can be legally obligated under the loan, extension of credit or guarantee is less than, (a) in the case of non-life insurers, the lesser of 3% of the insurer’s admitted assets or 25% of surplus as regards policyholders or, (b) in the case of life insurers, 3% of the insurer’s admitted assets, each as of the 31st day of December next preceding.
ITEM 4. LOANS OR EXTENSIONS OF CREDIT TO A NON-AFFILIATE.
If the transaction involves a loan or extension of credit to any person who is not an affiliate, furnish a brief description of the agreement or understanding whereby the proceeds of the proposed transaction, in whole or in substantial part, are to be used to make loans or extensions of credit to, to purchase the assets of, or to make investments in, any affiliate of the insurer making such loans or extensions of credit, and specify in what manner the proceeds are to be used to loan to, extend credit to, purchase assets of or make investments in any affiliate. Describe the amount and source of funds, securities, property or other consideration for the loan or extension of credit and, if the transaction is one involving consideration other than cash, a description of its cost and its fair market value together with an explanation of the basis for evaluation. Furnish a brief statement as to the effect of the transaction upon the insurer’s surplus.
No notice need be given if the loan or extension of credit is one which equals less than, in the case of nonlife insurers, the lesser of 3% of the insurer’s admitted assets or 25% of surplus as regards policyholders or, with respect to life insurers, 3% of the insurer’s admitted assets, each as of the 31st day of December next preceding.
ITEM 5. REINSURANCE.
If the transaction is a reinsurance agreement or modification thereto, as described by South Carolina Code Section 38-21-250(B)(3)(b) or a reinsurance pooling agreement or modification thereto as described by South Carolina Code Section 38-21-250(B)(3)(a), furnish a description of the known and/or estimated amount of liability to be ceded and/or assumed in each calendar year, the period of time during which the agreement will be in effect, and a statement whether an agreement or understanding exists between the insurer and non-affiliate to the effect that any portion of the assets constituting the consideration for the agreement will be transferred to one or more of the insurer’s affiliates. Furnish a brief description of the consideration involved in the transaction, and a brief statement as to the effect of the transaction upon the insurer’s surplus.
No notice need be given for reinsurance agreements or modifications thereto if the reinsurance premium or a change in the insurer’s liabilities, or the projected reinsurance premium or change in the insurer’s liabilities in any of the next three years, in connection with the reinsurance agreement or modification thereto is less than 5% of the insurer’s surplus as regards policyholders, as of the 31st day of December next preceding. Notice shall be given for all reinsurance pooling agreements including modifications thereto.
ITEM 6. MANAGEMENT AGREEMENTS, SERVICE AGREEMENTS AND COST-SHARING ARRANGEMENTS.
For management and service agreements, furnish:
(b) a brief description of the agreement, including a statement of its duration, together with brief descriptions of the basis for compensation and the terms under which payment or compensation is to be made.
For cost-sharing arrangements, furnish:
(g) A statement regarding compliance with the NAIC Accounting Practices and Procedure Manual regarding expense allocation.
ITEM 7. ALL OTHER TRANSACTIONS DETERMINED BY THE DIRECTOR TO BE MATERIAL, INCLUDING, BUT NOT LIMITED TO, REAL OR PERSONAL PROPERTY LEASES.
For leases, furnish:
(d) copy of the lease agreement.
ITEM 8. SIGNATURE AND CERTIFICATION.
Signature and certification required as follows:
| FORM E |
| PRE-ACQUISITION NOTIFICATION FORM |
| REGARDING THE POTENTIAL COMPETITIVE IMPACT |
| OF A PROPOSED MERGER OR ACQUISITION BY A |
| NON-DOMICILIARY INSURER DOING BUSINESS IN THIS |
| STATE OR BY A DOMESTIC INSURER |
| ________________________ |
| Name of Applicant |
| ________________________ |
| Name of Other Person |
| Involved in Merger or |
| Acquisition |
| Filed with the Insurance Department of the state of |
| Date: _________, 20 ____ . |
| Name, title, address, telephone number and e-mail address of person completing this statement: |
ITEM 1. NAME AND ADDRESS
State the names and addresses of the persons who hereby provide notice of their involvement in a pending acquisition or change in corporate control.
ITEM 2. NAME AND ADDRESSES OF AFFILIATED COMPANIES
State the names and addresses of the persons affiliated with those listed in Item 1. Describe their affiliations.
ITEM 3. NATURE AND PURPOSE OF THE PROPOSED MERGER OR ACQUISITION
State the nature and purpose of the proposed merger or acquisition.
ITEM 4. NATURE OF BUSINESS
State the nature of the business performed by each of the persons identified in response to Item 1 and Item 2.
ITEM 5. MARKET AND MARKET SHARE
State specifically what market and market share in each relevant insurance market the persons identified in Item 1 and Item 2 currently enjoy in this state. Provide historical market and market share data for each person identified in Item 1 and Item 2 for the past five years and identify the source of such data. Provide a determination as to whether the proposed acquisition or merger, if consummated, would violate the competitive standards of the state as stated in South Carolina Code Section 38-21-125(D). If the proposed acquisition or merger would violate competitive standards, provide justification of why the acquisition or merger would not substantially lessen competition or create a monopoly in the state.
For purposes of this question, market means direct written insurance premium in this state for a line of business as contained in the annual statement required to be filed by insurers licensed to do business in this state.
| FORM F | |
| ENTERPRISE RISK REPORT | |
| Filed with the Insurance Department of the State of _________ | |
| By | |
| ______________________________ | |
| Name of Registrant/Applicant | |
| On Behalf of Following Insurance Companies | |
| Name | Address |
| Date: _________, 20 ____ | |
| Name, Title, Address, Telephone Number and E-mail Address of Individual to Whom Notices and Correspondence Concerning This Statement Should Be Addressed: | |
ITEM 1. ENTERPRISE RISK
The Registrant/Applicant, to the best of its knowledge and belief, shall provide information regarding the following areas that could produce enterprise risk as defined in South Carolina Code Section 38-21-10, provided such information is not disclosed in the Insurance Holding Company System Annual Registration Statement filed on behalf of itself or another insurer for which it is the ultimate controlling person:
(j) Identification of any material activity or development of the insurance holding company system that, in the opinion of senior management, could adversely affect the insurance holding company system.
The Registrant/Applicant may attach the appropriate form most recently filed with the U.S. Securities and Exchange Commission, provided the Registrant/Applicant includes specific references to those areas listed in Item 1 for which the form provides responsive information. If the Registrant/Applicant is not domiciled in the U.S., it may attach its most recent public audited financial statement filed in its country of domicile, provided the Registrant/Applicant includes specific references to those areas listed in Item 1 for which the financial statement provides responsive information.
ITEM 2. OBLIGATION TO REPORT.
If the Registrant/Applicant has not disclosed any information pursuant to Item 1, the Registrant/Applicant shall include a statement affirming that, to the best of its knowledge and belief, it has not identified enterprise risk subject to disclosure pursuant to Item 1.
Section XX. Adequacy of Surplus.
The factors set forth in Section 38-21-90 D are not intended to be an exhaustive list. In determining the adequacy and reasonableness of an insurer’s surplus no single factor is necessarily controlling. The Commissioner instead will consider the net effect of all of these factors plus other factors bearing on the financial condition of the insurer. In comparing the surplus maintained by other insurers, the Commissioner will consider the extent to which each of these factors varies from company to company and in determining the quality and liquidity of investments in subsidiaries, the director or his designee will consider the individual subsidiary and may discount or disallow its valuation to the extent that the individual investments so warrant.
Section XXI. Severability.
If any provision of this regulation or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the regulation and the application of such provision to other persons or circumstances shall not be affected thereby.
| FORM A | |
| STATEMENT REGARDING THE ACQUISITION OF CONTROL | |
| OF OR MERGER WITH A DOMESTIC INSURER | |
| _________________________________________________________ | |
| Name of Domestic Insurer | |
| By | |
| _________________________________________________________ | |
| Name of Acquiring Person (Applicant) | |
| Filed with the Insurance Department of | |
| (State of domicile of insurer being acquired) | |
| Dated: __________, 20 ____ | |
| Name, Title, Address, Telephone Number and E-mail Address of Individual to Whom Notices and Correspondence Concerning This Statement Should be Addressed: | |
ITEM 1. INSURER AND METHOD OF ACQUISITION.
State the name and address of the domestic insurer to which this application relates and a brief description of how control is to be acquired.
ITEM 2. IDENTITY AND BACKGROUND OF THE APPLICANT.
HISTORY: Amended by State Register Volume 13, Issue No. 4, eff April 28, 1989; State Register Volume 18, Issue No. 3, eff March 25, 1994, by Part XVIII, eff January 1, 1994; State Register Volume 34, Issue No. 3, eff March 26, 2010; State Register Volume 39, Issue No. 6, Doc. No. 4480, eff June 26, 2015; SCSR 49-5 Doc. No. 5320, eff May 23, 2025.