Section 58-14-16 - Deduction from liability for reinsurance ceded to insurer not meeting requirementsof §§ 58-14-7 to 58-14-15--Security.
58-14-16. Deduction from liability for reinsurance ceded to insurer not meeting requirements of §§ 58-14-7 to 58-14-15--Security. A deduction from liability for the reinsurance ceded by a domestic insurer to an assuming insurer not meeting the requirements of §§ 58-14-7 to 58-14-15, inclusive, shall be allowed in an amount not exceeding the liabilities carried by the ceding insurer and the deduction shall be in the amount of funds held by or on behalf of the ceding insurer, including funds held in trust for the ceding insurer, under a reinsurance contract with the assuming insurer as security for the payment of obligations. The security shall be held in the United States subject to withdrawal solely by, and under the exclusive control of, the ceding insurer; or, in the case of a trust, it shall be held in a qualified United States financial institution, as defined in § 58-14-23. This security may be in the form of:
(1) Cash;
(2) Securities listed by the securities valuation office of the National Association of Insurance Commissioners and qualifying as admitted assets; or
(3) Any other form of security acceptable to the director.
Source: SL 1992, ch 344, § 10.