PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:
Proposed Action:
This is a consensus rule making to amend Subpart 80-1 (Regulation 52) of Title 11 NYCRR.
Statutory authority:
Financial Services Law, sections 202 and 302; and Insurance Law, sections 301, 1505 and 1506
Subject:
Holding Companies.
Purpose:
To conform to amendments made to Insurance Law section 1505(d) by chapter 238 of the Laws of 2013.
Text of proposed rule:
Section 80-1.5(c) is amended as follows:
(c) For the purposes of Insurance Law section 1505(d)(4), the following transactions between a domestic controlled insurer and any person in its holding company system are deemed to be material transactions:
(1) [Any] any sale, purchase, exchange, loan or extension of credit, or investment involving: [one-half of one percent or]
(i) less than three percent of [the insurer’s] a life insurance company’s admitted assets at last year-end that, when added to the respective aggregate of any such other sales, purchases, exchanges, unpaid loans, unpaid extensions of credit, or investments made during the preceding 12 months, causes the aggregate to equal or exceed three percent of the[:
(i) one-half of one percent of this insurer’s] company’s admitted assets at last year-end[, if the insurer is subject to article 42 of the Insurance Law]; [or]
(ii) [one percent of the insurer’s admitted assets at last year-end, if the insurer is not subject to article 42 of the Insurance Law;] with respect to an accident and health insurance company or a corporation subject to Insurance Law article 43, less than the lesser of three percent of the company or corporation’s admitted assets or 25% of capital and surplus at last year-end, that when added to the respective aggregate of any such other sales, purchases, exchanges, unpaid loans, unpaid extensions of credit, or investments made during the preceding 12 months, causes the aggregate to equal or exceed the lesser of three percent of the company or corporation’s admitted assets or 25% of capital and surplus at last year-end; or
(iii) with respect to an insurer other than as specified in subparagraphs (i) and (ii) of this paragraph, less than the lesser of three percent of the insurer’s admitted assets or 25% of surplus to policyholders at last year-end, that when added to the respective aggregate of any such other sales, purchases, exchanges, unpaid loans, unpaid extensions of credit, or investments made during the preceding 12 months, causes the aggregate to equal or exceed the lesser of three percent of the insurer’s admitted assets or 25% of surplus to policyholders at last year-end;
(2) [Any] any lease of real or personal property that does not provide for the rendering of services on a regular and systematic basis and where the aggregate payments to be made, including any renewal or extension thereof, exceeds:
(i) one percent of the insurer’s admitted assets at last year-end, if the insurer is subject to article 42 of the Insurance Law; or
(ii) two percent of the insurer's admitted assets at last year-end, if the insurer is not subject to article 42 of the Insurance Law; and
(3) any management agreements, service contracts, tax allocation agreements, guarantees, or cost-sharing arrangements.
Section 80-1.8 is repealed.
Section 80-1.9 is renumbered as section 80-1.8.
Text of proposed rule and any required statements and analyses may be obtained from:
Joana Lucashuk, New York State Department of Financial Services, One State Street, New York, NY 10004, (212) 480-2125, email: joana.lucashuk@dfs.ny.gov
Data, views or arguments may be submitted to:
Same as above.
Public comment will be received until:
45 days after publication of this notice.
Consensus Rule Making Determination
This rulemaking conforms section 80-1.5(c) to recent amendments made to Insurance Law section 1505(d) by Chapter 238 of the Laws of 2013, repeals section 80-1.8 because Chapter 238 added similar language to Insurance Law section 1506, and renumbers section 80-1.9 as section 80-1.8.
Because this amendment merely conforms the rule with revisions made to the Insurance Law, no person or entity is likely to object to this rulemaking. Thus, this rulemaking is determined by the agency to be a consensus rulemaking, as defined in State Administrative Procedure Act (“SAPA”) § 102(11), and is proposed pursuant to SAPA § 202(1)(b)(i). Therefore, this rulemaking is exempt from the requirement to file a Regulatory Impact Statement, Regulatory Flexibility Analysis for Small Businesses and Local Governments, or Rural Area Flexibility Analysis.
Job Impact Statement
Amendment of the regulation will not adversely impact job or employment opportunities in New York, or have any adverse impact on self-employment opportunities, because the revision imposes no new or additional requirements on any insurer subject to the rule. This rulemaking is amended to conform to recent amendments made to Insurance Law sections 1505(d) and 1506 by Chapter 238 of the Laws of 2013. The Department of Financial Services believes that the amended rule will not result in any adverse job or employment impact.
