380.271. Financial reinsurance requirements.
Financial reinsurance requirements.
380.271. 1. In order to commence or continue writing theclasses of insurance enumerated in section 380.261, any companyoperating under the provisions of sections 380.201 to 380.591shall comply with the following financial and reinsurancerequirements:
(1) To make fire insurance as described in section 380.261,a company shall maintain a guaranty fund of not less than fiftythousand dollars or one-tenth of one percent of the net fireinsurance in force, whichever is greater. Reinsurance sufficientto protect the financial stability of the company shall also berequired. The director may require additional reinsurance if hedeems it necessary to protect the policyholders of the company.
(2) To make windstorm insurance as described in section380.261, a company shall maintain a guaranty fund of not lessthan fifty thousand dollars or one-tenth of one percent of thenet wind insurance in force, whichever is greater. Reinsurancesufficient to protect the financial stability of the companyshall also be required. The director may require additionalreinsurance if he deems it necessary to protect the policyholdersof the company.
(3) To make liability insurance as described in section380.261, a company shall maintain a guaranty fund of not lessthan fifty thousand dollars or twenty-five percent of netpremiums written less deductions for pro rata, quota-share orper-risk excess of loss reinsurances directly covering thecompany's casualty premiums or assessments, whichever is greater.Reinsurance sufficient to protect the financial stability of thecompany shall also be required. The director may requireadditional reinsurance if he deems it necessary to protect thepolicyholders of the company.
(4) To make crop insurance as described in section 380.261,a company shall maintain a guaranty fund of not less than fiftythousand dollars or one-half of one percent of the net cropinsurance in force, whichever is greater. Reinsurance sufficientto protect the financial stability of the company shall also berequired. The director may require additional reinsurance if hedeems it necessary to protect the policyholders of the company.
(5) To make insurance as described in subdivision (5) ofsection 380.261, a company shall maintain a guaranty fund of notless than one million six hundred thousand dollars. Reinsurancesufficient to protect the financial stability of the companyshall also be required. The director may require additionalreinsurance if he deems it necessary to protect the policyholdersof the company.
2. The financial requirements of this section are to beconstrued cumulatively except that a company shall be required tohave a guaranty fund of not more than one million six hundredthousand dollars plus reinsurance.
(L. 1984 H.B. 1498, A.L. 1991 H.B. 592)