1. (a) An assuming insurer authorized by its state of domicile to assume the kind or kinds of insurance ceded thereto, but which is not licensed to transact the business of insurance or reinsurance in this state, may apply for accreditation and such assuming insurer may be referred to as the "applicant" where appropriate in these rules. A ceding insurer which cedes business to an accredited reinsurer may receive credit for reinsurance as either an asset or a deduction from liability the same as it would have been entitled to receive from a licensed reinsurer.

2. (b) Submission for accreditation, Form R-1, shall be filed with the Texas Department of Insurance, Reinsurance Activity. The necessary forms and checklists are available upon request from the Reinsurance Activity. The appropriate documents to be filed with the submission form include:

   1. (1) certified copy of the applicant's charter and amendments thereto;
   2. (2) certified copy of the applicant's latest examination report issued by the domiciliary jurisdiction as filed with the applicant's state of domicile;
   3. (3) annual financial statements, certified by the applicant's state of domicile, as filed with the applicant's state of domicile for each year of the last two years immediately preceding the year of submission;
   4. (4) last quarterly financial statement filed by applicant, if required, with the domiciliary jurisdiction;
   5. (5) certified copy of certificate or letter of authority or of compliance issued by the domiciliary jurisdiction;
   6. (6) certification by the applicant's treasurer that a surplus as regards policyholders in an amount not less than $20 million is maintained;
   7. (7) a list of the applicant's directors and key officers together with biographical data on each (Biographical Affidavit, Form R-2);
   8. (8) copy of holding company registration statement and related materials filed with the domiciliary jurisdiction for the past three years, if applicable, or a sworn statement of non-applicability;
   9. (9) an affidavit signed by the applicant's president or chief executive officer which submits the assuming insurer to both this state's jurisdiction and to this state's right to examine the applicant's books and records (Form R-3);
   10. (10) a completed accredited reinsurer checklist (Form R-4); and
   11. (11) any other information that the commissioner may reasonably require.
3. (c) Accreditation will not be granted by the commissioner until the reinsurer has submitted all information requested, has filed a properly executed Form R-3 as evidence of its submission to this state's authority to examine its books and records, and has demonstrated to the satisfaction of the commissioner that the reinsurer meets all the requirements for accreditation as stated in the Insurance Code, Article 3.10 or Article 5.75-1.
4. (d) The accredited reinsurer shall submit annually a certified annual financial statement, as filed with the insurance department of its state of domicile. In addition, the accredited reinsurer shall file quarterly a listing of ceding insurers with whom reinsurance agreements have been entered during that calendar quarter. The listing shall include the complete name and address of the ceding insurer. These documents shall be filed with the Reinsurance Activity, Texas Department of Insurance, by March 1 of each year for the annual statements, and March 1, May 15, August 15, and November 15 for each of the quarterly submissions.
5. (e) A filing fee for accreditation of reinsurers will be required annually when the annual statement is submitted to the Reinsurance Activity, Texas Department of Insurance. The filing fee amount is set forth in §7.1301 of this title (relating to Regulatory Fees).
6. (f) Renewal of accreditation will occur annually, subject to continuing compliance with the Insurance Code, Article 3.10, §(b)(2), or Article 5.75-1, §(b)(2), and this subchapter.
7. (g) Accreditation shall be automatically withdrawn at any time the assuming insurer fails to qualify under the Insurance Code, Article 3.10, §(b)(2), or Article 5.75-1, §(b)(2), or this subchapter. Notice of withdrawal shall be provided by certified mail to the most recent address of the accredited reinsurer according to the records of the Texas Department of Insurance. The accredited reinsurer may request a public hearing to show compliance and seek reinstatement of accreditation.
8. (h) No credit shall be allowed a ceding insurer with respect to reinsurance ceded four months after the assuming insurer's accreditation has been withdrawn and not reinstated by the commissioner. The Reinsurance Activity of the Texas Department of Insurance will maintain a list of accredited reinsurers, updated monthly. The Reinsurance Activity will notify the affected ceding insurer at the time that the assuming insurer's accreditation is withdrawn.

Source Note:The provisions of this §7.606 adopted to be effective August 16, 1990, 15 TexReg 4435; amended to be effective September 30, 1993, 18 TexReg 6329.