SB 171 (BR 1444) - J. Denton, T. Buford
AN ACT relating to reinsurance.
Amend KRS 304.5-140 to provide that no credit shall be allowed in the event of insolvency of the ceding insurer unless the reinsurance shall be payable under a contract reinsured by the assuming insurer on the basis of reported claims allowed by the liquidation court; permit the reinsurance agreement to provide that the domiciliary liquidator of an insolvent ceding insurer shall give written notice to the assuming insurer of the pendency of a claim against such ceding insurer on the contract reinsured within a reasonable time after such claim is filed in the liquidation proceeding; amend KRS 304.33-330 to delete the provision that provided that no set-off or counterclaim shall be allowed in favor of any person where the obligation of the person is to pay earned premiums to the insurer; amend KRS 304.33-350 to prohibit the reduction of the amount recoverable by the liquidator from a reinsurer as a result of delinquency proceeding unless the reinsurance contract provides that in the event of insolvency of the ceding insurer the reinsurance shall be payable under a contract reinsured by the assuming insurer on the basis of reported claims allowed by the liquidation court; amend KRS 304.33-380 to provide that no section in this subtitle shall be construed as authorizing the receiver to compel payment from a reinsurer on the basis of estimated incurred but not reported losses or outstanding reserves; permit the liquidator to negotiate a voluntary commutation and release of all obligations arising from reinsurance contracts or other agreements; create a new section of KRS 304.5-130 to 304.5-150 to permit an authorized insurer to reinsure its risks in any insurer authorized to do business in this state, any other state, the District of Columbia, or in any alien insurer; permit an authorized insurer to reinsure an unauthorized insurer as to property and casualty insurance policies which principally contemplate performance in Kentucky or as to such policies the principal subjects of risk of which are located in Kentucky.
SB 171 - AMENDMENTS
SCS - Retain original provisions, except provide that an authorized insurer may reinsure an insurer eligible for export, pursuant to Subtitle 10 of KRS Chapter 304; and provide that the amendment to KRS 304.33-330 does not affect contracts entered into prior to the effective date of this Act.
HCS - Retain original provisions; amend KRS 304.33-330(2)(d) to delete provision on right of a person to set off premium; provide that the paragraph shall only apply to reinsurance contracts entered into prior to the effective date of this Act; delete Section 6 of the Act.
Feb 11-introduced in Senate
Feb 17-to Banking and Insurance (S)
Feb 25-reported favorably, 1st reading, to Consent Calendar with Committee Substitute
Feb 26-2nd reading, to Rules
Mar 2-posted for passage in the Consent Orders of the Day for Wednesday, March 3, 2004
Mar 3-3rd reading, passed 36-0 with Committee Substitute ; received in House
Mar 4-to Banking and Insurance (H)
Mar 9-posted in committee
Mar 17-reported favorably, 1st reading, to Calendar with Committee Substitute
Mar 18-2nd reading, to Rules; posted for passage in the Regular Orders of the Day for Friday, March 19, 2004
Mar 23-3rd reading, passed 95-0 with Committee Substitute
Mar 24-received in Senate
Mar 25-posted for passage for concurrence in House Committee Substitute for Friday, March 26, 2004
Mar 26-Senate concurred in House Committee Substitute ; passed 34-0
Mar 29-enrolled, signed by each presiding officer; delivered to Governor
Apr 9-signed by Governor (Acts ch. 125)