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The Vermont Statutes Online



Title

08

:
Banking and Insurance






Chapter

101

:
INSURANCE COMPANIES GENERALLY






Subchapter

013
:
HOLDING COMPANIES AND SUBSIDIARIES










 

§

3696. Group-wide supervisor; internationally active insurance group

(a)(1) The

Commissioner is authorized to act as the group-wide supervisor for any

internationally active insurance group. The Commissioner, however, may

acknowledge another regulatory official as the supervisor, provided the group:

(A) does not

have substantial insurance operations in the United States;

(B) has

substantial insurance operations in the United States, but not in Vermont; or

(C) has

substantial insurance operations in the United States and in Vermont, but the

Commissioner has determined, pursuant to the factors in subsections (b) and (g)

of this section, that such other regulatory official is the appropriate

supervisor.

(2) An insurance

holding company system that does not otherwise qualify as an internationally

active insurance group under subdivision 3681(8) of this subchapter may request

that the Commissioner make a determination or acknowledgment as to a supervisor

pursuant to this section.

(b)(1) In

cooperation with other state, federal, and international regulatory agencies,

the Commissioner shall identify a single group-wide supervisor for a group. The

Commissioner may determine that he or she is the appropriate supervisor for a

group if the group conducts substantial insurance operations in Vermont, or the

Commissioner may acknowledge that a regulatory official from another

jurisdiction is the appropriate supervisor for such group. The Commissioner

shall consider the following factors when making a determination or acknowledgment

under this subsection:

(A) the place of

domicile of the insurers within the group that hold the largest share of the

group's written premiums, assets, or liabilities;

(B) the place of

domicile of the top-tiered insurers in the insurance holding company system of

the group;

(C) the location

of the executive offices or largest operational offices of the group;

(D) whether

another regulatory official is acting or is seeking to act as the supervisor

under a regulatory system the Commissioner determines to be:

(i)

substantially similar to the system of regulation provided under Vermont law,

or

(ii) otherwise

sufficient in terms of providing for supervision, enterprise risk analysis, and

cooperation with other regulatory officials; and

(E) whether

another regulatory official acting or seeking to act as the supervisor provides

the Commissioner with reasonably reciprocal recognition and cooperation.

(2) A

commissioner identified under this subsection as the group-wide supervisor may

determine that it is appropriate to acknowledge another supervisor to serve as

the group-wide supervisor. The acknowledgment of the supervisor shall be made

after consideration of the factors listed in subdivisions (A) through (E) of

this subdivision, and shall be made in cooperation with and subject to the

acknowledgment of other regulatory officials involved with supervision of the

members of the group, and in consultation with the group itself.

(c)

Notwithstanding any other provision of law to the contrary, when another regulatory

official is acting as the group-wide supervisor of an internationally active

insurance group, the Commissioner shall acknowledge such official as the

supervisor. However, the Commissioner shall make a determination or

acknowledgment as to the appropriate supervisor for such group pursuant to

subsection (b) of this section in the event of a material change in the group

that results in:

(1) the group's

insurers domiciled in Vermont holding the largest share of the group's

premiums, assets, or liabilities; or

(2) Vermont

becoming the place of domicile of the top-tiered insurers in the insurance

holding company system of the group.

(d) Pursuant to

section 3686 of this subchapter, the Commissioner is authorized to collect from

any insurer registered under section 3684 of this subchapter all information

necessary to determine whether the Commissioner shall act as the group-wide

supervisor of an internationally active insurance group or, instead,

acknowledge another regulatory official to act as supervisor.

(e) Prior to

issuing a determination that a group is subject to supervision by the

Commissioner, the Commissioner shall notify the insurer registered pursuant to

section 3684 of this subchapter of the pending determination, including the

ultimate controlling person within the group. The group shall have not less

than 30 days to provide the Commissioner with any additional information it

deems relevant to the determination. The Commissioner shall publish on its

website the identity of internationally active insurance groups subject to

supervision by him or her.

(f) If the

Commissioner is the supervisor for a group, the Commissioner is authorized to

engage in any of the following group-wide supervision activities:

(1) Assess the

enterprise risks within the group to ensure that:

(A) the material

financial condition and liquidity risks to the members of group engaged in the

business of insurance are identified by management; and

(B) reasonable

and effective mitigation measures are in place.

(2) Request,

from any member of a group subject to the Commissioner's supervision,

information necessary and appropriate to assess enterprise risk, including

information about the members of the group regarding:

(A) governance,

risk assessment, and management;

(B) capital

adequacy; and

(C) material

intercompany transactions.

(3) Coordinate

and, through the authority of the regulatory officials of the jurisdictions

where members of the group are domiciled, compel development and implementation

of reasonable measures designed to ensure that the group is able to timely

recognize and mitigate enterprise risks to members of the group engaged in the

business of insurance.

(4) Communicate

with other state, federal, and international regulatory agencies of members

within group and share relevant information, subject to the confidentiality

provisions of section 3687 of this subchapter, through supervisory colleges as

provided in section 3695 of this subchapter or otherwise.

(5) Enter into

agreements with or obtain documentation from any insurer registered under

section 3684 of this subchapter, any member of the group, and any other state,

federal, and international regulatory agencies of members of the group,

providing the basis for or otherwise clarifying the Commissioner's role as

group-wide supervisor, including provisions for resolving disputes with other

regulatory officials. Such agreements or documentation shall not serve as

evidence in any proceeding that any insurer or person within an insurance

holding company system not domiciled or incorporated in Vermont is doing

business in Vermont or is otherwise subject to Vermont jurisdiction.

(6) Engage in

other group-wide supervision activities, consistent with this subsection, as

deemed necessary by the Commissioner.

(g) If the

Commissioner acknowledges another regulatory official from a jurisdiction not

accredited by the NAIC as the group-wide supervisor, the Commissioner is

authorized to reasonably cooperate, through supervisory colleagues or

otherwise, with group-wide supervision undertaken by the supervisor, provided:

(1) The

Commissioner's cooperation is in compliance with Vermont law.

(2) The

regulatory official acknowledged as the supervisor also recognizes and

cooperates with the Commissioner's activities as a group-wide supervisor for

other internationally active insurance groups where applicable. When such

recognition and cooperation is not reasonably reciprocal, the Commissioner is

authorized to refuse recognition and cooperation.

(h) The

Commissioner is authorized to enter into agreements with or obtain

documentation from any insurer registered under section 3684 of this

subchapter, any affiliate of the insurer, and other state, federal, and

international regulatory agencies for members of the internationally active

insurance group that provide the basis for or otherwise clarify a regulatory

official's role as group-wide supervisor.

(i) The

Commissioner may adopt rules necessary for the administration of this section.

(j) A registered

insurer subject to this section is liable for and shall pay the reasonable

expenses of the Commissioner's participation in the administration of this

section, including the engagement of attorneys, actuaries, and any other

professionals, as well as all reasonable travel expenses. (Added 2015, No. 15, §

4, eff. May 1, 2015.)