S T A T E O F N E W Y O R K
________________________________________________________________________
8194--A
I N S E N A T E
June 15, 2010
___________
Introduced by Sen. BRESLIN -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee
AN ACT to amend the insurance law, in relation to incorporation of a
resolution facility
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The insurance law is amended by adding a new section 7719
to read as follows:
S 7719. RESOLUTION FACILITY. (A) THE CORPORATION MAY INCORPORATE A
NOT-FOR-PROFIT CORPORATION, KNOWN AS A RESOLUTION FACILITY, IN
CONNECTION WITH THE LIQUIDATION OF AN INSOLVENT DOMESTIC LIFE INSURANCE
COMPANY IF THE DOMESTIC LIFE INSURANCE COMPANY IS IN REHABILITATION
UNDER ARTICLE SEVENTY-FOUR OF THIS CHAPTER AS OF THE EFFECTIVE DATE OF
THIS SECTION, AND FOR THE PURPOSE OF ADMINISTERING AND DISPOSING OF THE
BUSINESS OF AN INSOLVENT DOMESTIC LIFE INSURANCE COMPANY ASSUMED BY OR
ASSIGNED TO THE RESOLUTION FACILITY.
(B) FUNDING FOR A RESOLUTION FACILITY MAY BE PROVIDED BY (I) THE
LIQUIDATOR OF THE INSOLVENT INSURER WHOSE BUSINESS IS ASSUMED BY OR
ASSIGNED TO THE RESOLUTION FACILITY, (II) THE CORPORATION, (III) THE
LIFE INSURANCE GUARANTY CORPORATION CONTINUED UNDER ARTICLE SEVENTY-FIVE
OF THIS CHAPTER, (IV) ANY OTHER GUARANTY CORPORATIONS OR ASSOCIATIONS OF
OTHER JURISDICTIONS HAVING OBLIGATIONS IN CONNECTION WITH INSURANCE
POLICIES, ANNUITY CONTRACTS OR FUNDING AGREEMENTS OF THE INSOLVENT
INSURER WHOSE BUSINESS IS ASSUMED BY OR ASSIGNED TO THE RESOLUTION
FACILITY, OR (V) ANY OTHER PERSON.
(C) EACH RESOLUTION FACILITY SHALL BE A TYPE C NOT-FOR-PROFIT CORPO-
RATION PURSUANT TO THE NOT-FOR-PROFIT CORPORATION LAW. A RESOLUTION
FACILITY SHALL HAVE ONE OR MORE CLASSES OF MEMBERS. THE CORPORATION
SHALL BE A MEMBER OF EACH RESOLUTION FACILITY, AND OTHER PERSONS,
INCLUDING, WITHOUT LIMITATION, THE LIFE INSURANCE GUARANTY CORPORATION
CONTINUED UNDER ARTICLE SEVENTY-FIVE OF THIS CHAPTER AND GUARANTY CORPO-
RATIONS OR ASSOCIATIONS OF OTHER JURISDICTIONS, MAY BECOME MEMBERS OF A
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD17767-02-0
S. 8194--A 2
RESOLUTION FACILITY IN ACCORDANCE WITH THE CERTIFICATE OF INCORPORATION,
BY-LAWS AND PLAN OF OPERATION OF THE RESOLUTION FACILITY. IN THE JUDG-
MENT OF THE LEGISLATURE, THE OBJECTS OF THE RESOLUTION FACILITY AUTHOR-
IZED TO BE ESTABLISHED UNDER THIS SECTION CANNOT BE ATTAINED BY A CORPO-
RATION ESTABLISHED UNDER GENERAL LAWS.
(D) IN ACCORDANCE WITH ITS PLAN OF OPERATION, A RESOLUTION FACILITY
MAY (I) GUARANTEE, ASSUME OR REINSURE, OR CAUSE TO BE GUARANTEED,
ASSUMED OR REINSURED, THE INSURANCE POLICIES, FUNDING AGREEMENTS OR
ANNUITY CONTRACTS OF THE INSOLVENT INSURER WHOSE BUSINESS IS ASSUMED BY
OR ASSIGNED TO THE RESOLUTION FACILITY (AS SUCH INSURANCE POLICIES,
FUNDING AGREEMENTS OR ANNUITY CONTRACTS MAY HAVE BEEN AMENDED, MODIFIED
OR RESTRUCTURED WITH THE APPROVAL OF A COURT OF COMPETENT JURISDICTION),
OR ARRANGE FOR REPLACEMENT BY INSURANCE POLICIES, FUNDING AGREEMENTS OR
ANNUITY CONTRACTS FOUND BY THE LIQUIDATOR OF SUCH INSOLVENT INSURER TO
BE SUBSTANTIALLY SIMILAR TO SUCH INSURANCE POLICIES, FUNDING AGREEMENTS
OR ANNUITY CONTRACTS OF SUCH INSOLVENT INSURER OR REPLACEMENT BY INSUR-
ANCE POLICIES, FUNDING AGREEMENTS OR ANNUITY CONTRACTS APPROVED BY A
COURT OF COMPETENT JURISDICTION, AND (II) OTHERWISE EXERCISE THE POWERS
OF A DOMESTIC LIFE INSURANCE COMPANY, BUT IN NO CASE MAY A RESOLUTION
FACILITY ISSUE INSURANCE POLICIES, FUNDING AGREEMENTS OR ANNUITY
CONTRACTS OTHER THAN THOSE ISSUED IN RESPECT OF THE CONTRACTUAL OBLI-
GATIONS OF THE INSOLVENT INSURER.
(E) SECTION SEVEN THOUSAND SEVEN HUNDRED FIFTEEN OF THIS ARTICLE AND
THE FIRST TWO SENTENCES OF SECTION SEVEN THOUSAND SEVEN HUNDRED SIXTEEN
OF THIS ARTICLE SHALL APPLY TO THE RESOLUTION FACILITY AS THEY APPLY TO
THE CORPORATION; NO OTHER PROVISIONS OF THIS CHAPTER, OTHER THAN THOSE
CONTAINED IN THIS SECTION, SHALL APPLY TO A RESOLUTION FACILITY.
(F) IN ADDITION TO ITS CERTIFICATE OF INCORPORATION AND BY-LAWS, A
RESOLUTION FACILITY SHALL ADOPT A PLAN OF OPERATION NECESSARY OR SUIT-
ABLE TO ASSURE THE FAIR, REASONABLE AND EQUITABLE ADMINISTRATION OF SUCH
RESOLUTION FACILITY'S BUSINESS. THE PLAN OF OPERATION SHALL BE SUBMITTED
TO THE LIQUIDATOR OF THE INSOLVENT INSURER WHOSE BUSINESS IS TO BE
ASSUMED BY OR ASSIGNED TO THE RESOLUTION FACILITY AND SHALL BE EFFECTIVE
UPON THE WRITTEN APPROVAL OF SUCH LIQUIDATOR.
(G) THE PLAN OF OPERATION SHALL SET FORTH (I) THE OVERSIGHT AUTHORITY
FOR THE RESOLUTION FACILITY, AND (II) PROCEDURES FOR AMENDMENTS OR
MODIFICATIONS TO THE PLAN OF OPERATION.
(H) NO LATER THAN AUGUST FIRST OF EACH YEAR, A RESOLUTION FACILITY
SHALL FILE WITH THE SUPERINTENDENT A FINANCIAL REPORT SUMMARIZING ITS
CONDITION AT LAST CALENDAR YEAR END OR AT THE LAST FISCAL YEAR END
ENDING ON OR PRIOR TO THE LAST CALENDAR YEAR END.
S 2. This act shall take effect immediately.