Assembly Actions -
Lowercase Senate Actions - UPPERCASE |
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Aug 23, 2023 |
signed chap.344 |
Aug 11, 2023 |
delivered to governor |
Jun 10, 2023 |
returned to senate passed assembly ordered to third reading rules cal.835 substituted for a7356a |
Jun 08, 2023 |
referred to codes delivered to assembly passed senate ordered to third reading cal.1772 committee discharged and committed to rules |
May 22, 2023 |
print number 7095a |
May 22, 2023 |
amend and recommit to finance reported and committed to finance |
May 18, 2023 |
referred to insurance |
Senate Bill S7095A
Signed By Governor2023-2024 Legislative Session
Relates to group capital calculations, liquidity stress tests and confidentiality
download bill text pdfSponsored By
(D, WF) 46th Senate District
Current Bill Status - Signed by Governor
- Introduced
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- In Committee Assembly
- In Committee Senate
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- On Floor Calendar Assembly
- On Floor Calendar Senate
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- Passed Assembly
- Passed Senate
- Delivered to Governor
- Signed By Governor
Actions
Votes
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Floor Vote: Jun 8, 2023
aye (61)- Addabbo Jr.
- Ashby
- Bailey
- Borrello
- Breslin
- Brisport
- Brouk
- Canzoneri-Fitzpatrick
- Chu
- Cleare
- Comrie
- Felder
- Fernandez
- Gallivan
- Gianaris
- Gonzalez
- Gounardes
- Harckham
- Helming
- Hinchey
- Hoylman-Sigal
- Jackson
- Kavanagh
- Kennedy
- Krueger
- Lanza
- Liu
- Mannion
- Martinez
- Martins
- Mattera
- May
- Mayer
- Murray
- Myrie
- O'Mara
- Oberacker
- Ortt
- Palumbo
- Parker
- Persaud
- Ramos
- Rhoads
- Rivera
- Rolison
- Ryan
- Salazar
- Sanders Jr.
- Scarcella-Spanton
- Sepúlveda
- Serrano
- Skoufis
- Stavisky
- Stec
- Stewart-Cousins
- Tedisco
- Thomas
- Walczyk
- Webb
- Weber
- Weik
nay (1)excused (1)
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Jun 8, 2023 - Rules Committee Vote
S7095A18Aye1Nay1Aye with Reservations0Absent1Excused0AbstainedMay 22, 2023 - Insurance Committee Vote
S7095A10Aye0Nay1Aye with Reservations0Absent0Excused0Abstained-
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Insurance Committee Vote: May 22, 2023
aye (10)aye wr (1)
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Bill Amendments
2023-S7095 - Details
- See Assembly Version of this Bill:
- A7356
- Law Section:
- Insurance Law
- Laws Affected:
- Amd Ins L, generally
2023-S7095 - Sponsor Memo
BILL NUMBER: S7095 SPONSOR: BRESLIN TITLE OF BILL: An act to amend the insurance law, in relation to group capital calcu- lations, liquidity stress tests, and confidentiality PURPOSE OF THE BILL: The purpose of this bill is to amend the Insurance Law with regard to group capital calculations ("GCCs"), liquidity stress tests ("LSTs"), and confidentiality. SUMMARY OF PROVISIONS: Section 1 of the bill would amend Insurance Law § 110(a)(1) and (2) to permit the Superintendent of Financial Services ("Superintendent") to share confidential information, including trade secret documents, with any third-party consultant designated by the Superintendent, and any local law enforcement authority. In addition, it would amend § 110(b) to provide that: (1) the sharing of documents, materials, or information by
the Superintendent will not constitute a delegation of regulatory authority or rulemaking, and the Superintendent is solely responsible for the administration, execution, and enforcement of the provisions of this section; and (2) documents, materials, or other information in the possession or control of the National Association of Insurance Commis- sioners ("NAIC") or third-party consultants pursuant to § 110 will be confidential by law and privileged, will not be subject to Public Offi- cers Law Article6, will not be subject to subpoena, and will not be subject to discovery or admissible in evidence in any private civil action. Section 2 would add new Insurance Law § 1501(a)(8), (9), (10), and (11) to define "group capital calculation instructions", "NAIC", "NAIC liquidity stress test framework", and "scope criteria." Section 3 would add new Insurance Law § 1503(c) and (d) to require an ultimate holding company to file with the Superintendent an annual GCC by April 30 of each year when New York is the lead state, subject to certain exceptions, and to require an ultimate holding company to file the results of a specific year's LST with the Superintendent if an insurer it controls is scoped into the NAIC liquidity stress test frame- work, when New York is the lead state. When the lead state is not New York, an ultimate holding company must file with the Superintendent the annual GCC or the results of a specific year's LST if the ultimate hold- ing company has not filed it with the company's lead state because the lead state has not enacted a GCC or LST filing requirement or the ulti- mate holding company has filed the annual GCC or LST results with the lead state but the lead state is not willing or able to share the annual GCC or LST results with the Superintendent. Section 3 also would add a new Insurance Law § 1503(e) to provide that no insurer, insurance producer, or other person shall make, publish, disseminate, circulate, or issue, or place before the public, or cause directly or indirectly to be made, published, disseminated, circulated, issued, or placed before the public, in this state, in any newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over any radio or television station or any electronic means of communication available to the public, or in any other way as an advertisement, announcement, sign, pamphlet, circular, card, or statement containing a statement or representation with regard to the GCC, group capital ratio, LST results, or supporting disclosures for such test, or any component derived in the calculation thereof, of any insurer or holding company system, provided, however, that an insur- er may publish, with the Superintendent's prior approval, an announce- ment in a written publication to rebut any materially false statement with respect to the foregoing if the insurer is able to demonstrate to the Superintendent, with substantial proof, the falsity of such state- ment or inappropriateness, as the case may be, and if the sole purpose of the announcement is to rebut the materially false statement. Section 4 would amend Insurance Law § 1504(c) to kovidethat the' contents of any report or filing made pursuant to Insurance Law Article 15 are proprietary and are not subject to subpoena or discovery or admissible in evidence in any private civil action. It also would amend this section to provide that neither the Superintendent nor any person who received a report or filing made pursuant to Article 15 and any information obtained in connection therewith, through examination or otherwise, while acting under the authority of the Superintendent or with whom such report or information are shared pursuant to the Insur- ance Law, will be permitted or required to testify in any private civil action concerning the report or information. Section 5 would amend Insurance Law § 1506(f) to provide that a holding company does not need to file with the Superintendent notice that it is seeking to divest its controlling interest in a domestic insurer if an acquisition of control notice is filed with the Superintendent. Section 6 would add new Insurance Law § 1511, which would require a controlled insurer to be liable for and pay the reasonable expenses of the Superintendent's participation in the administration of group-wide supervision of internationally active insurance groups, including the engagement of attorneys, actuaries, and any other professionals and all reasonable travel expenses. Section 7 would amend Insurance Law § 1603(d) to make changes similar to the changes made in section 5 of this bill. Section 8 would add new Insurance Law § 1604(c), (d), (e), and (f) to make changes similar to the changes made in section 3 of this bill. Section 9 would add a new Insurance Law §§ 1613 and 1614. Section 1613 would require a domestic insurer to pay the expenses of group-wide supervision similar to section 6 of this bill. Section 1614 would provide that the contents of each report and filing submitted under Article 16 and information pertaining thereto must be kept confidential, is not subject to subpoena or discovery, is not admissible in evidence in any private civil action, and may not be made public unless, after notice and opportunity to be heard, the Superintendent determines that the interests of policyholders, subscribers, stockholders, or the public will be served by the publication thereof. It also would state that neither the Superintendent nor any person who received a report or filing submitted pursuant to Article 16 and information pertaining ther- eto, through examination or otherwise, while acting under the authority of the Superintendent or with whom such report or information are shared pursuant to the Insurance Law, will be permitted or required to testify in any private civil action concerning the report, filing, or informa- tion. Section 10 would amend the title of Insurance Law § 1702. Section 11 would add new Insurance Law § 1702(g), (h), (i), and (j) to add definitions. Section 12 would amend Insurance Law § 1709 to expand the applicability of the section and to provide that the information being kept confiden- tial is not subject to discovery and is not admissible in evidence in any private civil action. It also would provide that neither the Super- intendent nor any person who received a report or filing submitted pursuant to Article 17 and information pertaining thereto, through exam- ination or otherwise, while acting under the authority of the Super- intendent or with whom such report or information are shared pursuant to the Insurance Law, will be permitted or required to testify in any private civil action concerning the report, filing, or information. Section 13 would amend Insurance Law § 1710(a) in a manner similar to sections 5 and 7 of this bill. Section 14 would add a new Insurance Law § 1717(c), (d), and (e) to make changes like the changes made in sections 3 and 8 of this bill. Section 15 would add a new Insurance Law § 1718, which would require a parent corporation to pay the expenses of group-wide supervision similar to sections 6 and 9 of this bill. Section 16 would provide for an immediate effective date. JUSTIFICATION: The bill amends the Insurance Law to impose an annual GCC filing requirement, which is necessary to comply with the bilateral agreements between the U.S. and E.U. and U.S. and U.K. on prudential measures regarding insurance and reinsurance. States must have a worldwide group capital calculation in place to avoid the E.U. or U.K. imposing its own GCC on that group and therefore all the U.S. insurers within the group. The GCC will also become an NAIC accreditation standard with which the Department of Financial Services ("DFS") must comply to maintain its accreditation. NAIC accreditation is a certification given to a state insurance regulator once the regulator has demonstrated that it has met and continues to meet baseline solvency regulation standards and various legal, financial, and organizational standards as determined by a committee of its peers. The bill also adds a LST filing requirement, which also will become an NAIC accreditation standard. According to the NAIC, to provide more evidence-based analyses, an NAIC task force developed a LST targeted mainly at large life insurers that aims to capture the impact on the broader financial markets of aggregate asset sales under a liquidity stress event. The primary goal of the LST is to provide quantitative as well as qualitative insights for macroprudential surveillance, such as identifying the amount of asset sales that could occur during a specific stress scenario. The LST also will aid micro prudential regulation. In addition, the bill amends Insurance Law §§ 1506(f), 1603(d), and 1710(a) to provide that a holding company, authorized domestic insurer, or parent corporation, respectively, does not need to file with the Superintendent notice that it is seeking to divest its controlling interest in a domestic insurer if an acquisition of control notice is filed with the Superintendent. This amendment will prevent duplicative notices and is consistent with the NAIC model Insurance Holding Company System Regulatory Act. Finally, the bill amends the Insurance Law to modify or add certain confidentiality provisions to ensure consistency with the model Acts and other states to facilitate the sharing of confidential documents between state regulators. Certain other states have been unwilling to share certain confidential information with DFS alleging that the confiden- tiality provisions set forth in the Insurance Law are inadequate. PRIOR LEGISLATIVE HISTORY: A.10226/S.9006 (2022) FISCAL IMPLICATIONS: None. EFFECTIVE DATE: Immediately
2023-S7095 - Bill Text download pdf
S T A T E O F N E W Y O R K ________________________________________________________________________ 7095 2023-2024 Regular Sessions I N S E N A T E May 18, 2023 ___________ Introduced by Sen. BRESLIN -- (at request of the Department of Financial Services) -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance AN ACT to amend the insurance law, in relation to group capital calcu- lations, liquidity stress tests, and confidentiality THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraphs 1 and 2 of subsection (a) and subsection (b) of section 110 of the insurance law, paragraphs 1 and 2 of subsection (a) as amended by chapter 238 of the laws of 2013 and subsection (b) as added by chapter 687 of the laws of 2003, are amended to read as follows: (1) may share documents, materials or other information, including confidential [and], privileged, AND TRADE SECRET documents, materials or information with other LOCAL, state, federal, and international regula- tory agencies, with the National Association of Insurance Commissioners, its affiliates or subsidiaries, [and] WITH ANY THIRD-PARTY CONSULTANT DESIGNATED BY THE SUPERINTENDENT, with LOCAL, state, federal, and inter- national law enforcement authorities, including members of any supervi- sory college described in section three hundred two of this chapter, provided that the recipient has the authority and agrees to maintain the confidentiality and privileged status of the document, material or other information AND HAS VERIFIED IN WRITING THE LEGAL AUTHORITY TO MAINTAIN CONFIDENTIALITY; provided, however, that this paragraph shall not be construed as limiting access to records pursuant to article six of the public officers law, EXCEPT AS PROVIDED IN PARAGRAPH THREE OF SUBSECTION (B) OF THIS SECTION; (2) may receive documents, materials or information, including other- wise confidential [and], privileged, AND TRADE SECRET documents, materi- als or information, from the National Association of Insurance Commis- sioners, its affiliates or subsidiaries [and], from regulatory and law EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD08515-02-3
S. 7095 2 enforcement officials of other foreign or domestic jurisdictions, including members of any supervisory college described in section three hundred two of this chapter, AND FROM ANY OTHER ENTITY DESIGNATED BY THE SUPERINTENDENT IN A REGULATION, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information; and (b) (1) No waiver of any applicable privilege or claim of confiden- tiality in the documents, materials, or information shall occur as a result of disclosure to the superintendent under this section or as a result of sharing as authorized in this section. (2) THE SHARING OF DOCUMENTS, MATERIALS, OR INFORMATION BY THE SUPER- INTENDENT PURSUANT TO THIS SECTION SHALL NOT CONSTITUTE A DELEGATION OF REGULATORY AUTHORITY OR RULEMAKING, AND THE SUPERINTENDENT IS SOLELY RESPONSIBLE FOR THE ADMINISTRATION, EXECUTION, AND ENFORCEMENT OF THE PROVISIONS OF THIS SECTION. (3) DOCUMENTS, MATERIALS, OR OTHER INFORMATION IN THE POSSESSION OR CONTROL OF THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS OR THIRD- PARTY CONSULTANTS PURSUANT TO THIS SECTION SHALL BE CONFIDENTIAL BY LAW AND PRIVILEGED, SHALL NOT BE SUBJECT TO ARTICLE SIX OF THE PUBLIC OFFI- CERS LAW, SHALL NOT BE SUBJECT TO SUBPOENA, AND SHALL NOT BE SUBJECT TO DISCOVERY OR ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION. § 2. Subsection (a) of section 1501 of the insurance law is amended by adding four new paragraphs 8, 9, 10 and 11 to read as follows: (8) "GROUP CAPITAL CALCULATION INSTRUCTIONS" MEANS THE GROUP CAPITAL CALCULATION INSTRUCTIONS AS ADOPTED BY THE: (A) NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC; AND (B) SUPERINTENDENT PURSUANT TO A REGULATION. (9) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. (10) "NAIC LIQUIDITY STRESS TEST FRAMEWORK" MEANS AN NAIC PUBLICATION THAT INCLUDES A HISTORY OF THE NAIC'S DEVELOPMENT OF REGULATORY LIQUIDI- TY STRESS TESTING, THE SCOPE CRITERIA APPLICABLE FOR A SPECIFIC DATA YEAR, AND THE LIQUIDITY STRESS TEST INSTRUCTIONS AND REPORTING TEMPLATES FOR A SPECIFIC DATA YEAR, SUCH SCOPE CRITERIA, INSTRUCTIONS AND REPORT- ING TEMPLATE BEING AS ADOPTED BY THE: (A) NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC; AND (B) SUPERINTENDENT PURSUANT TO A REGULATION. (11) "SCOPE CRITERIA" MEANS THE DESIGNATED EXPOSURE BASES ALONG WITH MINIMUM MAGNITUDES THEREOF FOR THE SPECIFIED DATA YEAR, USED TO ESTAB- LISH A PRELIMINARY LIST OF INSURERS CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. § 3. Section 1503 of the insurance law is amended by adding three new subsections (c), (d) and (e) to read as follows: (C) (1) AN ULTIMATE HOLDING COMPANY SHALL FILE WITH THE SUPERINTENDENT AN ANNUAL GROUP CAPITAL CALCULATION BY APRIL THIRTIETH OF EACH YEAR WHEN THIS STATE IS THE LEAD STATE OF THE HOLDING COMPANY SYSTEM AS DETERMINED IN ACCORDANCE WITH THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC, AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, AN ULTIMATE HOLDING COMPANY SHALL FILE WITH THE SUPERINTENDENT THE ANNUAL GROUP CAPITAL CALCULATION IF THE ULTIMATE HOLDING COMPANY HAS NOT FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH ITS LEAD STATE BECAUSE THE LEAD STATE HAS NOT ENACTED AN ANNUAL GROUP CAPITAL CALCULATION FILING REQUIREMENT OR THE ULTIMATE HOLDING COMPANY HAS FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE ANNUAL GROUP CAPITAL S. 7095 3 CALCULATION WITH THE SUPERINTENDENT. THE ULTIMATE HOLDING COMPANY SHALL COMPLETE THE ANNUAL GROUP CAPITAL CALCULATION IN ACCORDANCE WITH THE GROUP CAPITAL CALCULATION INSTRUCTIONS, WHICH MAY PERMIT THE SUPERINTEN- DENT TO ALLOW A HOLDING COMPANY THAT IS NOT THE ULTIMATE HOLDING COMPANY TO FILE THE ANNUAL GROUP CAPITAL CALCULATION. WHEN THIS STATE IS THE LEAD STATE, AN ULTIMATE HOLDING COMPANY SHALL BE EXEMPT FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION IF IT IS PART OF A HOLDING COMPANY SYSTEM THAT: (A) HAS ONLY ONE INSURER WITHIN ITS SYSTEM THAT ONLY WRITES BUSINESS AND IS ONLY LICENSED IN ITS DOMESTIC STATE AND ASSUMES NO BUSINESS FROM ANY OTHER INSURER; (B) IS REQUIRED TO PERFORM A GROUP CAPITAL CALCULATION SPECIFIED BY THE UNITED STATES FEDERAL RESERVE BOARD, EXCEPT THAT THE HOLDING COMPANY SHALL NOT BE EXEMPT IF THE SUPERINTENDENT REQUESTS THE GROUP CAPITAL CALCULATION FROM THE UNITED STATES FEDERAL RESERVE BOARD UNDER THE TERMS OF INFORMATION SHARING AGREEMENTS IN EFFECT AND THE FEDERAL RESERVE BOARD CANNOT SHARE THE CALCULATION WITH THE SUPERINTENDENT; (C) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS LOCATED WITHIN A RECIPROCAL JURISDICTION, AS DESCRIBED IN PART ONE HUNDRED TWEN- TY-FIVE OF TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THIS STATE, THAT RECOGNIZES THE UNITED STATES STATE REGU- LATORY APPROACH TO GROUP SUPERVISION AND GROUP CAPITAL; OR (D)(I) PROVIDES INFORMATION TO THE SUPERINTENDENT, EITHER DIRECTLY OR INDIRECTLY THROUGH THE GROUP-WIDE SUPERVISOR, WHO HAS DETERMINED SUCH INFORMATION IS SATISFACTORY TO ALLOW THE SUPERINTENDENT TO COMPLY WITH THE NAIC GROUP SUPERVISION APPROACH, AS DETAILED IN THE NAIC FINANCIAL ANALYSIS HANDBOOK; AND (II) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS NOT IN A RECIPROCAL JURISDICTION THAT RECOGNIZES AND ACCEPTS, AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION, THE GROUP CAPITAL CALCULATION AS THE WORLD-WIDE GROUP CAPITAL ASSESSMENT FOR UNITED STATES HOLDING COMPANY SYSTEMS THAT OPERATE IN THAT JURISDICTION. (2) NOTWITHSTANDING SUBPARAGRAPHS (C) AND (D) OF PARAGRAPH ONE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT SHALL REQUIRE THE GROUP CAPITAL CALCULATION FOR UNITED STATES OPERATIONS OF ANY NON-UNITED STATES-BASED HOLDING COMPANY SYSTEM WHERE, AFTER ANY NECESSARY CONSULTATION WITH OTHER SUPERVISORS OR OFFICIALS, IT IS DEEMED APPROPRIATE BY THE SUPERINTENDENT FOR PRUDENTIAL OVERSIGHT AND SOLVENCY MONITORING PURPOSES OR FOR ENSURING THE COMPETITIVENESS OF THE INSURANCE MARKETPLACE. (3) NOTWITHSTANDING THE EXEMPTIONS FROM FILING THE GROUP CAPITAL CALCULATION SET FORTH IN PARAGRAPH ONE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT HAS THE DISCRETION TO EXEMPT A HOLDING COMPANY FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION OR ACCEPT A LIMITED GROUP CAPITAL CALCULATION FILING OR REPORT IN ACCORD- ANCE WITH CRITERIA AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION. (4) WHEN THIS STATE IS THE LEAD STATE, IF THE SUPERINTENDENT DETER- MINES THAT A HOLDING COMPANY NO LONGER MEETS ONE OR MORE OF THE REQUIRE- MENTS FOR AN EXEMPTION FROM FILING THE GROUP CAPITAL CALCULATION UNDER THIS SUBSECTION, THE HOLDING COMPANY SHALL FILE THE GROUP CAPITAL CALCU- LATION AT THE NEXT ANNUAL FILING DATE UNLESS GIVEN AN EXTENSION BY THE SUPERINTENDENT BASED ON REASONABLE GROUNDS SHOWN. (D)(1) AN ULTIMATE HOLDING COMPANY THAT DIRECTLY OR INDIRECTLY CONTROLS AN INSURER SUBJECT TO REGISTRATION AND THAT IS SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK SHALL FILE THE RESULTS OF A SPECIF- IC YEAR'S ANNUAL LIQUIDITY STRESS TEST WITH THE SUPERINTENDENT WHEN THIS S. 7095 4 STATE IS THE LEAD STATE OF THE HOLDING COMPANY SYSTEM AS DETERMINED BY THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC AND AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, AN ULTIMATE HOLDING COMPANY SHALL FILE WITH THE SUPERINTENDENT THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST IF THE ULTIMATE HOLDING COMPANY HAS NOT FILED THE RESULTS WITH THE LEAD STATE BECAUSE THE LEAD STATE HAS NOT ENACTED A LIQUIDITY STRESS TEST FILING REQUIRE- MENT OR THE ULTIMATE HOLDING COMPANY HAS FILED THE RESULTS WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE RESULTS WITH THE SUPERINTENDENT. THE PERFORMANCE OF, AND FILING OF THE RESULTS FROM, A SPECIFIC YEAR'S LIQUIDITY STRESS TEST SHALL COMPLY WITH THE NAIC LIQUIDITY STRESS TEST FRAMEWORK. (2) ANY CHANGE TO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK OR TO THE DATA YEAR FOR WHICH THE SCOPE CRITERIA ARE TO BE MEASURED SHALL BE EFFECTIVE ON JANUARY FIRST OF THE YEAR FOLLOWING THE CALENDAR YEAR WHEN SUCH CHANGES ARE ADOPTED. WHEN THIS STATE IS THE LEAD STATE, AN INSURER MEETING AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL NOT BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. WHEN THIS STATE IS THE LEAD STATE, AN INSURER THAT DOES NOT TRIGGER AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR, UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAME- WORK FOR THAT DATA YEAR. THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, SHALL ASSESS THE CONCERN OF WISHING TO AVOID HAVING INSURERS SCOPED IN AND OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK ON A FREQUENT BASIS AS PART OF THE DETERMINATION FOR AN INSURER. (E) NO INSURER, INSURANCE PRODUCER, OR OTHER PERSON SHALL MAKE, PUBLISH, DISSEMINATE, CIRCULATE, ISSUE, OR PLACE BEFORE THE PUBLIC, OR CAUSE DIRECTLY OR INDIRECTLY TO BE MADE, PUBLISHED, DISSEMINATED, CIRCU- LATED, ISSUED, OR PLACED BEFORE THE PUBLIC, IN THIS STATE, IN ANY NEWS- PAPER, MAGAZINE, OR OTHER PUBLICATION, OR IN THE FORM OF A NOTICE, CIRCULAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR TELEVISION STATION OR ANY ELECTRONIC MEANS OF COMMUNICATION AVAILABLE TO THE PUBLIC, OR IN ANY OTHER WAY AS AN ADVERTISEMENT, ANNOUNCEMENT, OR STATE- MENT CONTAINING A REPRESENTATION OR STATEMENT WITH REGARD TO THE GROUP CAPITAL CALCULATION, GROUP CAPITAL RATIO, LIQUIDITY STRESS TEST RESULTS, OR SUPPORTING DISCLOSURES FOR SUCH TEST, OR ANY COMPONENT DERIVED IN THE CALCULATION THEREOF, OF ANY INSURER OR HOLDING COMPANY SYSTEM, PROVIDED, HOWEVER, THAT AN INSURER MAY PUBLISH, WITH THE SUPERINTENDENT'S PRIOR APPROVAL, AN ANNOUNCEMENT IN A WRITTEN PUBLICATION TO REBUT ANY MATE- RIALLY FALSE STATEMENT WITH RESPECT TO THE FOREGOING IF THE INSURER IS ABLE TO DEMONSTRATE TO THE SUPERINTENDENT WITH SUBSTANTIAL PROOF THE FALSITY OF SUCH STATEMENT OR INAPPROPRIATENESS, AS THE CASE MAY BE, AND IF THE SOLE PURPOSE OF THE ANNOUNCEMENT IS TO REBUT THE MATERIALLY FALSE STATEMENT. § 4. Subsection (c) of section 1504 of the insurance law, as amended by chapter 238 of the laws of 2013, is amended to read as follows: (c) (1) The [superintendent shall keep the] contents of each report AND FILING made pursuant to this article and any information obtained in connection therewith SHALL BE confidential AND PROPRIETARY AND SHALL NOT S. 7095 5 BE SUBJECT TO SUBPOENA OR DISCOVERY OR ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION, and THE SUPERINTENDENT shall not make the same public without the prior written consent of the controlled insurer to which it pertains unless the superintendent, after notice and an oppor- tunity to be heard, shall determine that the interests of policyholders, shareholders or the public will be served by the publication thereof. In any action or proceeding by the superintendent against the person exam- ined or any other person within the same holding company system a report of such examination published by the superintendent shall be admissible as evidence of the facts stated therein. (2) NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVED A REPORT OR FILING MADE PURSUANT TO THIS ARTICLE AND ANY INFORMATION OBTAINED IN CONNECTION THEREWITH, THROUGH EXAMINATION OR OTHERWISE, WHILE ACTING UNDER THE AUTHORITY OF THE SUPERINTENDENT OR WITH WHOM SUCH REPORT, FILING, OR INFORMATION ARE SHARED PURSUANT TO THIS CHAPTER, SHALL BE PERMITTED OR REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THE REPORT, FILING, OR INFORMATION. § 5. Subsection (f) of section 1506 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: (f) Any holding company seeking to divest its controlling interest in a domestic insurer, in any manner, shall file with the superintendent, with a copy to the insurer, notice of its proposed divestiture at least thirty days prior to the cessation of control, PROVIDED, HOWEVER THAT THIS SUBSECTION SHALL NOT APPLY IF NOTICE IS PROVIDED AS REQUIRED BY SUBSECTION (A) OF THIS SECTION. § 6. The insurance law is amended by adding a new section 1511 to read as follows: § 1511. EXPENSES FOR GROUP-WIDE SUPERVISION. A CONTROLLED INSURER SHALL BE LIABLE FOR AND SHALL PAY THE REASONABLE EXPENSES OF THE SUPER- INTENDENT'S PARTICIPATION IN THE ADMINISTRATION OF GROUP-WIDE SUPER- VISION OF INTERNATIONALLY ACTIVE INSURANCE GROUPS, INCLUDING THE ENGAGE- MENT OF ATTORNEYS, ACTUARIES, AND ANY OTHER PROFESSIONALS AND ALL REASONABLE TRAVEL EXPENSES. § 7. Subsection (d) of section 1603 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: (d) Any domestic insurer seeking to divest its controlling interest in another domestic insurer, in any manner, shall file with the superinten- dent, with a copy to the insurer, notice of its proposed divestiture at least thirty days prior to the cessation of control, PROVIDED, HOWEVER THAT THIS SUBSECTION SHALL NOT APPLY IF NOTICE IS PROVIDED AS REQUIRED BY SUBSECTION (A) OF THIS SECTION. § 8. Section 1604 of the insurance law is amended by adding four new subsections (c), (d), (e) and (f) to read as follows: (C) (1) AN AUTHORIZED DOMESTIC INSURER, OTHER THAN A DOMESTIC INSURER REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, SHALL FILE WITH THE SUPER- INTENDENT AN ANNUAL GROUP CAPITAL CALCULATION BY APRIL THIRTIETH OF EACH YEAR WHEN THIS STATE IS THE LEAD STATE AS DETERMINED IN ACCORDANCE WITH THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC, AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, AN AUTHORIZED DOMESTIC INSURER SHALL FILE WITH THE SUPERINTENDENT THE ANNUAL GROUP CAPITAL CALCULATION IF THE AUTHORIZED DOMESTIC INSURER HAS NOT FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH ITS LEAD STATE BECAUSE THE LEAD STATE HAS NOT ENACTED AN ANNUAL GROUP CAPITAL CALCU- LATION FILING REQUIREMENT OR THE AUTHORIZED DOMESTIC INSURER HAS FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH THE LEAD STATE BUT THE LEAD S. 7095 6 STATE IS NOT WILLING OR ABLE TO SHARE THE ANNUAL GROUP CAPITAL CALCU- LATION WITH THE SUPERINTENDENT. THE AUTHORIZED DOMESTIC INSURER SHALL COMPLETE THE ANNUAL GROUP CAPITAL CALCULATION IN ACCORDANCE WITH THE GROUP CAPITAL CALCULATION INSTRUCTIONS, WHICH MAY PERMIT THE SUPERINTEN- DENT TO ALLOW A SUBSIDIARY TO FILE THE ANNUAL GROUP CAPITAL CALCULATION. WHEN THIS STATE IS THE LEAD STATE, AN AUTHORIZED DOMESTIC INSURER SHALL BE EXEMPT FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION IF IT: (A) HAS ONLY ONE INSURER SUBSIDIARY THAT ONLY WRITES BUSINESS AND IS ONLY LICENSED IN ITS DOMESTIC STATE AND ASSUMES NO BUSINESS FROM ANY OTHER INSURER; (B) IS REQUIRED TO PERFORM A GROUP CAPITAL CALCULATION SPECIFIED BY THE UNITED STATES FEDERAL RESERVE BOARD, EXCEPT THAT THE AUTHORIZED DOMESTIC INSURER SHALL NOT BE EXEMPT IF THE SUPERINTENDENT REQUESTS THE GROUP CAPITAL CALCULATION FROM THE UNITED STATES FEDERAL RESERVE BOARD UNDER THE TERMS OF INFORMATION SHARING AGREEMENTS IN EFFECT AND THE FEDERAL RESERVE BOARD CANNOT SHARE THE CALCULATION WITH THE SUPERINTEN- DENT; (C) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS LOCATED WITHIN A RECIPROCAL JURISDICTION, AS DESCRIBED IN PART ONE HUNDRED TWEN- TY-FIVE OF TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THIS STATE, THAT RECOGNIZES THE UNITED STATES STATE REGU- LATORY APPROACH TO GROUP SUPERVISION AND GROUP CAPITAL; OR (D)(I) PROVIDES INFORMATION TO THE SUPERINTENDENT, EITHER DIRECTLY OR INDIRECTLY THROUGH THE GROUP-WIDE SUPERVISOR, WHO HAS DETERMINED SUCH INFORMATION IS SATISFACTORY TO ALLOW THE SUPERINTENDENT TO COMPLY WITH THE NAIC GROUP SUPERVISION APPROACH, AS DETAILED IN THE NAIC FINANCIAL ANALYSIS HANDBOOK; AND (II) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS NOT IN A RECIPROCAL JURISDICTION AND THAT RECOGNIZES AND ACCEPTS, AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION, THE GROUP CAPITAL CALCULATION AS THE WORLD-WIDE GROUP CAPITAL ASSESSMENT FOR UNITED STATES SYSTEMS THAT OPER- ATE IN THAT JURISDICTION. (2) NOTWITHSTANDING SUBPARAGRAPHS (C) AND (D) OF PARAGRAPH ONE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT SHALL REQUIRE THE GROUP CAPITAL CALCULATION FOR UNITED STATES OPERATIONS OF ANY NON-UNITED STATES-BASED SYSTEM WHERE, AFTER ANY NECESSARY CONSULTA- TION WITH OTHER SUPERVISORS OR OFFICIALS, IT IS DEEMED APPROPRIATE BY THE SUPERINTENDENT FOR PRUDENTIAL OVERSIGHT AND SOLVENCY MONITORING PURPOSES OR FOR ENSURING THE COMPETITIVENESS OF THE INSURANCE MARKET- PLACE. (3) NOTWITHSTANDING THE EXEMPTIONS FROM FILING THE GROUP CAPITAL CALCULATION SET FORTH IN PARAGRAPH ONE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT HAS THE DISCRETION TO EXEMPT AN AUTHORIZED DOMESTIC INSURER FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION OR ACCEPT A LIMITED ANNUAL GROUP CAPITAL CALCULATION FILING OR REPORT IN ACCORDANCE WITH CRITERIA AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION. (4) WHEN THIS STATE IS THE LEAD STATE, IF THE SUPERINTENDENT DETER- MINES THAT AN AUTHORIZED DOMESTIC INSURER NO LONGER MEETS ONE OR MORE OF THE REQUIREMENTS FOR AN EXEMPTION FROM FILING THE GROUP CAPITAL CALCU- LATION UNDER THIS SUBSECTION, THE AUTHORIZED DOMESTIC INSURER SHALL FILE THE GROUP CAPITAL CALCULATION AT THE NEXT ANNUAL FILING DATE UNLESS GIVEN AN EXTENSION BY THE SUPERINTENDENT BASED ON REASONABLE GROUNDS SHOWN. (D)(1) AN AUTHORIZED DOMESTIC INSURER, OTHER THAN A DOMESTIC INSURER REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE S. 7095 7 THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, THAT HAS A SUBSIDIARY THAT IS SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK SHALL FILE THE RESULTS OF A SPECIFIC YEAR'S ANNUAL LIQUIDITY STRESS TEST WITH THE SUPERINTENDENT WHEN THIS STATE IS THE LEAD STATE AS DETERMINED BY THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC AND AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, AN AUTHORIZED DOMESTIC INSURER SHALL FILE WITH THE SUPERINTENDENT THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST IF THE AUTHORIZED DOMESTIC INSURER HAS NOT FILED THE RESULTS WITH ITS LEAD STATE BECAUSE THE LEAD STATE HAS NOT ENACTED A LIQUIDITY STRESS TEST FILING REQUIRE- MENT OR THE AUTHORIZED DOMESTIC INSURER HAS FILED THE RESULTS WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE RESULTS WITH THE SUPERINTENDENT. (2) ANY CHANGE TO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK OR TO THE DATA YEAR FOR WHICH THE SCOPE CRITERIA ARE TO BE MEASURED SHALL BE EFFECTIVE ON JANUARY FIRST OF THE YEAR FOLLOWING THE CALENDAR YEAR WHEN SUCH CHANGES ARE ADOPTED. WHEN THIS STATE IS THE LEAD STATE, AN INSURER MEETING AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL NOT BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. WHEN THIS STATE IS THE LEAD STATE, AN INSURER THAT DOES NOT TRIGGER AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR, UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAME- WORK FOR THAT DATA YEAR. THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, SHALL ASSESS THE CONCERN OF WISHING TO AVOID HAVING INSURERS SCOPED IN AND OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK ON A FREQUENT BASIS AS PART OF THE DETERMINATION FOR AN INSURER. (E) NO INSURER, INSURANCE PRODUCER, OR OTHER PERSON SHALL MAKE, PUBLISH, DISSEMINATE, CIRCULATE, ISSUE, OR PLACE BEFORE THE PUBLIC, OR CAUSE DIRECTLY OR INDIRECTLY TO BE MADE, PUBLISHED, DISSEMINATED, CIRCU- LATED, ISSUED, OR PLACED BEFORE THE PUBLIC, IN THIS STATE, IN A NEWSPA- PER, MAGAZINE, OR OTHER PUBLICATION, OR IN THE FORM OF A NOTICE, CIRCU- LAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR TELEVISION STATION OR ANY ELECTRONIC MEANS OF COMMUNICATION AVAILABLE TO THE PUBLIC, OR IN ANY OTHER WAY AS AN ADVERTISEMENT, ANNOUNCEMENT, OR STATE- MENT CONTAINING A REPRESENTATION OR STATEMENT WITH REGARD TO THE GROUP CAPITAL CALCULATION, GROUP CAPITAL RATIO, LIQUIDITY STRESS TEST RESULTS, OR SUPPORTING DISCLOSURES FOR SUCH TEST, OR ANY COMPONENT DERIVED IN THE CALCULATION THEREOF, OF ANY AUTHORIZED DOMESTIC INSURER OR SUBSIDIARY THEREOF, PROVIDED, HOWEVER, THAT AN INSURER MAY PUBLISH, WITH THE SUPER- INTENDENT'S PRIOR APPROVAL, ANNOUNCEMENTS IN A WRITTEN PUBLICATION TO REBUT ANY MATERIALLY FALSE STATEMENT WITH RESPECT TO THE FOREGOING IF THE INSURER IS ABLE TO DEMONSTRATE TO THE SUPERINTENDENT WITH SUBSTAN- TIAL PROOF THE FALSITY OF SUCH STATEMENT OR THE INAPPROPRIATENESS, AS THE CASE MAY BE, AND IF THE SOLE PURPOSE OF THE ANNOUNCEMENT IS TO REBUT THE MATERIALLY FALSE STATEMENT. (F) FOR THE PURPOSE OF THIS SECTION: (1) "GROUP CAPITAL CALCULATION INSTRUCTIONS" MEANS THE GROUP CAPITAL CALCULATION INSTRUCTIONS AS ADOPTED BY THE: (A) NAIC AND AS AMENDED BY S. 7095 8 THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC; AND (B) SUPERINTENDENT PURSUANT TO A REGULATION. (2) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. (3) "NAIC LIQUIDITY STRESS TEST FRAMEWORK" MEANS AN NAIC PUBLICATION THAT INCLUDES A HISTORY OF THE NAIC'S DEVELOPMENT OF REGULATORY LIQUIDI- TY STRESS TESTING, THE SCOPE CRITERIA APPLICABLE FOR A SPECIFIC DATA YEAR, AND THE LIQUIDITY STRESS TEST INSTRUCTIONS AND REPORTING TEMPLATES FOR A SPECIFIC DATA YEAR, SUCH SCOPE CRITERIA, INSTRUCTIONS AND REPORT- ING TEMPLATE BEING AS ADOPTED BY THE: (A) NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC; AND (B) SUPERINTENDENT PURSUANT TO A REGULATION. (4) "SCOPE CRITERIA" MEANS THE DESIGNATED EXPOSURE BASES ALONG WITH MINIMUM MAGNITUDES THEREOF FOR THE SPECIFIED DATA YEAR, USED TO ESTAB- LISH A PRELIMINARY LIST OF INSURERS CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. § 9. The insurance law is amended by adding two new sections 1613 and 1614 to read as follows: § 1613. EXPENSES FOR GROUP-WIDE SUPERVISION. AN AUTHORIZED DOMESTIC INSURER SHALL BE LIABLE FOR AND SHALL PAY THE REASONABLE EXPENSES OF THE SUPERINTENDENT'S PARTICIPATION IN THE ADMINISTRATION OF GROUP-WIDE SUPERVISION OF INTERNATIONALLY ACTIVE INSURANCE GROUPS, INCLUDING THE ENGAGEMENT OF ATTORNEYS, ACTUARIES, AND ANY OTHER PROFESSIONALS AND ALL REASONABLE TRAVEL EXPENSES. § 1614. CONFIDENTIALITY OF REPORTS AND FILINGS. THE CONTENTS OF EACH REPORT AND FILING SUBMITTED PURSUANT TO THIS ARTICLE AND INFORMATION PERTAINING THERETO SHALL BE KEPT CONFIDENTIAL, SHALL NOT BE SUBJECT TO SUBPOENA OR DISCOVERY, SHALL NOT BE ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION, AND SHALL NOT BE MADE PUBLIC UNLESS, AFTER NOTICE AND OPPORTUNITY TO BE HEARD, THE SUPERINTENDENT DETERMINES THAT THE INTERESTS OF POLICYHOLDERS, SUBSCRIBERS, STOCKHOLDERS OR THE PUBLIC WILL BE SERVED BY THE PUBLICATION THEREOF. NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVED A REPORT OR FILING SUBMITTED PURSUANT TO THIS ARTI- CLE AND INFORMATION PERTAINING THERETO, THROUGH EXAMINATION OR OTHER- WISE, WHILE ACTING UNDER THE AUTHORITY OF THE SUPERINTENDENT OR WITH WHOM SUCH REPORT OR INFORMATION ARE SHARED PURSUANT TO THIS CHAPTER, SHALL BE PERMITTED OR REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THE REPORT, FILING, OR INFORMATION. § 10. The section heading of section 1702 of the insurance law, as amended by chapter 238 of the laws of 2013, is amended to read as follows: [Meaning of "subsidiary", "parent corporation" and "enterprise risk"; certain types of subsidiaries defined] DEFINITIONS. § 11. Section 1702 of the insurance law is amended by adding four new subsections (g), (h), (i) and (j) to read as follows: (G) "GROUP CAPITAL CALCULATION INSTRUCTIONS" MEANS THE GROUP CAPITAL CALCULATION INSTRUCTIONS AS ADOPTED BY THE: (1) NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC; AND (2) SUPERINTENDENT PURSUANT TO A REGULATION. (H) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. (I) "NAIC LIQUIDITY STRESS TEST FRAMEWORK" MEANS AN NAIC PUBLICATION THAT INCLUDES A HISTORY OF THE NAIC'S DEVELOPMENT OF REGULATORY LIQUIDI- TY STRESS TESTING, THE SCOPE CRITERIA APPLICABLE FOR A SPECIFIC DATA YEAR, AND THE LIQUIDITY STRESS TEST INSTRUCTIONS AND REPORTING TEMPLATES FOR A SPECIFIC DATA YEAR, SUCH SCOPE CRITERIA, INSTRUCTIONS AND REPORT- ING TEMPLATE BEING AS ADOPTED BY THE: (1) NAIC AND AS AMENDED BY THE S. 7095 9 NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC; AND (2) SUPERINTENDENT PURSUANT TO A REGULATION. (J) "SCOPE CRITERIA" MEANS THE DESIGNATED EXPOSURE BASES ALONG WITH MINIMUM MAGNITUDES THEREOF FOR THE SPECIFIED DATA YEAR, USED TO ESTAB- LISH A PRELIMINARY LIST OF INSURERS CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. § 12. Section 1709 of the insurance law, as amended by chapter 381 of the laws of 1986, is amended to read as follows: § 1709. Confidentiality of [information] reports AND FILINGS. The contents of each [information] report [filed hereunder] AND FILING SUBMITTED PURSUANT TO THIS ARTICLE and information pertaining thereto shall be kept confidential, shall not be subject to subpoena OR DISCOV- ERY, SHALL NOT BE ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION, and shall not be made public unless, after notice and opportunity to be heard, the superintendent determines that the interests of policyhold- ers, subscribers, stockholders or the public will be served by the publication thereof. The provisions of this section shall not be appli- cable to any [information] report [filed hereunder] OR FILING SUBMITTED PURSUANT TO THIS ARTICLE and any information pertaining thereto, if the parent corporation is a corporation subject to article forty-three of this chapter. NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVED A REPORT OR FILING SUBMITTED PURSUANT TO THIS ARTICLE AND INFORMATION PERTAINING THERETO, THROUGH EXAMINATION OR OTHERWISE, WHILE ACTING UNDER THE AUTHORITY OF THE SUPERINTENDENT OR WITH WHOM SUCH REPORT OR INFORMA- TION ARE SHARED PURSUANT TO THIS CHAPTER, SHALL BE PERMITTED OR REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THE REPORT, FILING, OR INFORMATION. § 13. Subsection (a) of section 1710 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: (a) Any parent corporation seeking to divest its controlling interest in a domestic insurer, in any manner, shall file with the superinten- dent, with a copy to the insurer, notice of its proposed divestiture at least thirty days prior to the cessation of control, PROVIDED, HOWEVER THAT THIS SUBSECTION SHALL NOT APPLY IF NOTICE IS PROVIDED AS REQUIRED BY SUBSECTION (B) OF SECTION ONE THOUSAND SEVEN HUNDRED ONE OF THIS ARTICLE. § 14. Section 1717 of the insurance law is amended by adding three new subsections (c), (d) and (e) to read as follows: (C) (1) A PARENT CORPORATION, OTHER THAN A PARENT CORPORATION REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, SHALL FILE WITH THE SUPERINTENDENT AN ANNUAL GROUP CAPITAL CALCULATION BY APRIL THIRTIETH OF EACH YEAR WHEN THIS STATE IS THE LEAD STATE AS DETERMINED IN ACCORDANCE WITH THE PROCE- DURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC, AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, A PARENT CORPORATION SHALL FILE WITH THE SUPERINTENDENT THE ANNUAL GROUP CAPITAL CALCULATION IF THE PARENT CORPORATION HAS NOT FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH ITS LEAD STATE BECAUSE THE LEAD STATE HAS NOT ENACTED AN ANNUAL GROUP CAPITAL CALCULATION FILING REQUIREMENT OR THE PARENT CORPORATION HAS FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE ANNUAL GROUP CAPITAL CALCULATION WITH THE SUPERINTENDENT. THE PARENT CORPORATION SHALL COMPLETE THE ANNUAL GROUP CAPITAL CALCULATION IN ACCORDANCE WITH THE GROUP CAPITAL CALCULATION INSTRUCTIONS, WHICH MAY PERMIT THE SUPERINTENDENT TO ALLOW A SUBSIDIARY TO FILE THE ANNUAL GROUP CAPITAL CALCULATION. WHEN THIS STATE IS THE LEAD STATE, A PARENT CORPO- S. 7095 10 RATION SHALL BE EXEMPT FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION IF IT: (A) HAS ONLY ONE INSURER SUBSIDIARY THAT ONLY WRITES BUSINESS AND IS ONLY LICENSED IN ITS DOMESTIC STATE AND ASSUMES NO BUSINESS FROM ANY OTHER INSURER; (B) IS REQUIRED TO PERFORM A GROUP CAPITAL CALCULATION SPECIFIED BY THE UNITED STATES FEDERAL RESERVE BOARD, EXCEPT THAT THE PARENT CORPO- RATION SHALL NOT BE EXEMPT IF THE SUPERINTENDENT REQUESTS THE GROUP CAPITAL CALCULATION FROM THE UNITED STATES FEDERAL RESERVE BOARD UNDER THE TERMS OF INFORMATION SHARING AGREEMENTS IN EFFECT AND THE FEDERAL RESERVE BOARD CANNOT SHARE THE CALCULATION WITH THE SUPERINTENDENT; (C) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS LOCATED WITHIN A RECIPROCAL JURISDICTION, AS DESCRIBED IN PART ONE HUNDRED TWEN- TY-FIVE OF TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THIS STATE, THAT RECOGNIZES THE UNITED STATES STATE REGU- LATORY APPROACH TO GROUP SUPERVISION AND GROUP CAPITAL; OR (D)(I) PROVIDES INFORMATION TO THE SUPERINTENDENT, EITHER DIRECTLY OR INDIRECTLY THROUGH THE GROUP-WIDE SUPERVISOR, WHO HAS DETERMINED SUCH INFORMATION IS SATISFACTORY TO ALLOW THE SUPERINTENDENT TO COMPLY WITH THE NAIC GROUP SUPERVISION APPROACH, AS DETAILED IN THE NAIC FINANCIAL ANALYSIS HANDBOOK; AND (II) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS NOT IN A RECIPROCAL JURISDICTION THAT RECOGNIZES AND ACCEPTS, AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION, THE GROUP CAPITAL CALCULATION AS THE WORLD-WIDE GROUP CAPITAL ASSESSMENT FOR UNITED STATES SYSTEMS THAT OPER- ATE IN THAT JURISDICTION. (2) NOTWITHSTANDING SUBPARAGRAPHS (C) AND (D) OF PARAGRAPH ONE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT SHALL REQUIRE THE GROUP CAPITAL CALCULATION FOR UNITED STATES OPERATIONS OF ANY NON-UNITED STATES-BASED SYSTEM WHERE, AFTER ANY NECESSARY CONSULTA- TION WITH OTHER SUPERVISORS OR OFFICIALS, IT IS DEEMED APPROPRIATE BY THE SUPERINTENDENT FOR PRUDENTIAL OVERSIGHT AND SOLVENCY MONITORING PURPOSES OR FOR ENSURING THE COMPETITIVENESS OF THE INSURANCE MARKET- PLACE. (3) NOTWITHSTANDING THE EXEMPTIONS FROM FILING THE GROUP CAPITAL CALCULATION SET FORTH IN PARAGRAPH ONE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT HAS THE DISCRETION TO EXEMPT A PARENT CORPORATION FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION OR ACCEPT A LIMITED ANNUAL GROUP CAPITAL CALCULATION FILING OR REPORT IN ACCORDANCE WITH CRITERIA AS SPECIFIED BY THE SUPERINTENDENT IN A REGU- LATION. (4) WHEN THIS STATE IS THE LEAD STATE, IF THE SUPERINTENDENT DETER- MINES THAT A PARENT CORPORATION NO LONGER MEETS ONE OR MORE OF THE REQUIREMENTS FOR AN EXEMPTION FROM FILING THE GROUP CAPITAL CALCULATION UNDER THIS SUBSECTION, THE PARENT CORPORATION SHALL FILE THE GROUP CAPI- TAL CALCULATION AT THE NEXT ANNUAL FILING DATE UNLESS GIVEN AN EXTENSION BY THE SUPERINTENDENT BASED ON REASONABLE GROUNDS SHOWN. (D)(1) A PARENT CORPORATION, OTHER THAN A PARENT CORPORATION REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, THAT HAS A SUBSIDIARY THAT IS SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK SHALL FILE THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST WITH THE SUPERINTENDENT WHEN THIS STATE IS THE LEAD STATE AS DETERMINED BY THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC AND AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, A PARENT CORPORATION SHALL FILE WITH THE SUPERINTENDENT THE RESULTS OF A SPECIFIC YEAR'S S. 7095 11 LIQUIDITY STRESS TEST IF THE PARENT CORPORATION HAS NOT FILED THE RESULTS WITH ITS LEAD STATE BECAUSE THE LEAD STATE HAS NOT ENACTED A LIQUIDITY STRESS TEST FILING REQUIREMENT OR THE PARENT CORPORATION HAS FILED THE RESULTS WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE RESULTS WITH THE SUPERINTENDENT. (2) ANY CHANGE TO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK OR TO THE DATA YEAR FOR WHICH THE SCOPE CRITERIA ARE TO BE MEASURED SHALL BE EFFECTIVE ON JANUARY FIRST OF THE YEAR FOLLOWING THE CALENDAR YEAR WHEN SUCH CHANGES ARE ADOPTED. WHEN THIS STATE IS THE LEAD STATE, AN INSURER MEETING AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL NOT BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. WHEN THIS STATE IS THE LEAD STATE, AN INSURER THAT DOES NOT TRIGGER AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR, UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAME- WORK FOR THAT DATA YEAR. THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, SHALL ASSESS THE CONCERN OF WISHING TO AVOID HAVING INSURERS SCOPED IN AND OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK ON A FREQUENT BASIS AS PART OF THE DETERMINATION FOR AN INSURER. (E) NO INSURER, INSURANCE PRODUCER, OR OTHER PERSON SHALL MAKE, PUBLISH, DISSEMINATE, CIRCULATE, ISSUE, OR PLACE BEFORE THE PUBLIC, OR CAUSE DIRECTLY OR INDIRECTLY TO BE MADE, PUBLISHED, DISSEMINATED, CIRCU- LATED, ISSUED, OR PLACED BEFORE THE PUBLIC, IN THIS STATE, IN A NEWSPA- PER, MAGAZINE, OR OTHER PUBLICATION, OR IN THE FORM OF A NOTICE, CIRCU- LAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR TELEVISION STATION OR ANY ELECTRONIC MEANS OF COMMUNICATION AVAILABLE TO THE PUBLIC, OR IN ANY OTHER WAY AS AN ADVERTISEMENT, ANNOUNCEMENT, OR STATE- MENT CONTAINING A REPRESENTATION OR STATEMENT WITH REGARD TO THE GROUP CAPITAL CALCULATION, GROUP CAPITAL RATIO, LIQUIDITY STRESS TEST RESULTS OR SUPPORTING DISCLOSURES FOR SUCH TEST, OR ANY COMPONENT DERIVED IN THE CALCULATION THEREOF, OF ANY PARENT CORPORATION OR SUBSIDIARY THEREOF, PROVIDED, HOWEVER, THAT A PARENT CORPORATION MAY PUBLISH, WITH THE SUPERINTENDENT'S PRIOR APPROVAL, ANNOUNCEMENTS IN A WRITTEN PUBLICATION TO REBUT ANY MATERIALLY FALSE STATEMENT WITH RESPECT TO THE FOREGOING IF THE INSURER IS ABLE TO DEMONSTRATE TO THE SUPER- INTENDENT WITH SUBSTANTIAL PROOF THE FALSITY OF SUCH STATEMENT OR THE INAPPROPRIATENESS, AS THE CASE MAY BE, AND IF THE SOLE PURPOSE OF THE ANNOUNCEMENT IS TO REBUT THE MATERIALLY FALSE STATEMENT. § 15. The insurance law is amended by adding a new section 1718 to read as follows: § 1718. EXPENSES FOR GROUP-WIDE SUPERVISION. A PARENT CORPORATION SHALL BE LIABLE FOR AND SHALL PAY THE REASONABLE EXPENSES OF THE SUPER- INTENDENT'S PARTICIPATION IN THE ADMINISTRATION OF GROUP-WIDE SUPER- VISION OF INTERNATIONALLY ACTIVE INSURANCE GROUPS, INCLUDING THE ENGAGE- MENT OF ATTORNEYS, ACTUARIES, AND ANY OTHER PROFESSIONALS AND ALL REASONABLE TRAVEL EXPENSES. § 16. This act shall take effect immediately.
2023-S7095A (ACTIVE) - Details
- See Assembly Version of this Bill:
- A7356
- Law Section:
- Insurance Law
- Laws Affected:
- Amd Ins L, generally
2023-S7095A (ACTIVE) - Sponsor Memo
BILL NUMBER: S7095A SPONSOR: BRESLIN TITLE OF BILL: An act to amend the insurance law, in relation to group capital calcu- lations, liquidity stress tests, and confidentiality PURPOSE OF THE BILL: The purpose of this bill is to amend the Insurance Law with regard to group capital calculations ("GCCs"), liquidity stress tests ("LSTs"), and confidentiality. SUMMARY OF PROVISIONS: Section 1 of the bill would amend Insurance Law § 110(a)(1) and (2) to permit the Superintendent of Financial Services ("Superintendent") to share confidential information, including trade secret documents, with any third-party consultant designated by the Superintendent, and any local law enforcement authority. In addition, it would amend § 110(b) to provide that: (1) the sharing of documents, materials, or information by
the Superintendent will not constitute a delegation of regulatory authority or rulemaking, and the Superintendent is solely responsible for the administration, execution, and enforcement of the provisions of this section; and (2) documents, materials, or other information in the possession or control of the National Association of Insurance Commis- sioners ("NAIC") or third-party consultants pursuant to § 110 will be confidential by law and privileged, will not be subject to Public Offi- cers Law Article6, will not be subject to subpoena, and will not be subject to discovery or admissible in evidence in any private civil action. Section 2 would add new Insurance Law § 1501(a)(8), (9), (10), and (11) to define "group capital calculation instructions", "NAIC", "NAIC liquidity stress test framework", and "scope criteria." Section 3 would add new Insurance Law § 1503(c) and (d) to require an ultimate holding company to file with the Superintendent an annual GCC by April 30 of each year when New York is the lead state, subject to certain exceptions, and to require an ultimate holding company to file the results of a specific year's LST with the Superintendent if an insurer it controls is scoped into the NAIC liquidity stress test frame- work, when New York is the lead state. When the lead state is not New York, an ultimate holding company must file with the Superintendent the annual GCC or the results of a specific year's LST if the ultimate hold- ing company has not filed it with the company's lead state because the lead state has not enacted a GCC or LST filing requirement or the ulti- mate holding company has filed the annual GCC or LST results with the lead state but the lead state is not willing or able to share the annual GCC or LST results with the Superintendent. Section 3 also would add a new Insurance Law § 1503(e) to provide that no insurer, insurance producer, or other person shall make, publish, disseminate, circulate, or issue, or place before the public, or cause directly or indirectly to be made, published, disseminated, circulated, issued, or placed before the public, in this state, in any newspaper, magazine, or other publication, or in the form of a notice, circular, pamphlet, letter, or poster, or over any radio or television station or any electronic means of communication available to the public, or in any other way as an advertisement, announcement, sign, pamphlet, circular, card, or statement containing a statement or representation with regard to the GCC, group capital ratio, LST results, or supporting disclosures for such test, or any component derived in the calculation thereof, of any insurer or holding company system, provided, however, that an insur- er may publish, with the Superintendent's prior approval, an announce- ment in a written publication to rebut any materially false statement with respect to the foregoing if the insurer is able to demonstrate to the Superintendent, with substantial proof, the falsity of such state- ment or inappropriateness, as the case may be, and if the sole purpose of the announcement is to rebut the materially false statement. Section 4 would amend Insurance Law § 1504(c) to kovidethat the' contents of any report or filing made pursuant to Insurance Law Article 15 are proprietary and are not subject to subpoena or discovery or admissible in evidence in any private civil action. It also would amend this section to provide that neither the Superintendent nor any person who received a report or filing made pursuant to Article 15 and any information obtained in connection therewith, through examination or otherwise, while acting under the authority of the Superintendent or with whom such report or information are shared pursuant to the Insur- ance Law, will be permitted or required to testify in any private civil action concerning the report or information. Section 5 would amend Insurance Law § 1506(f) to provide that a holding company does not need to file with the Superintendent notice that it is seeking to divest its controlling interest in a domestic insurer if an acquisition of control notice is filed with the Superintendent. Section 6 would add new Insurance Law § 1511, which would require a controlled insurer to be liable for and pay the reasonable expenses of the Superintendent's participation in the administration of group-wide supervision of internationally active insurance groups, including the engagement of attorneys, actuaries, and any other professionals and all ò reasonable travel expenses. Section 7 would amend Insurance Law § 1603(d) to make changes similar to the changes made in section 5 of this bill. Section 8 would add new Insurance Law § 1604(c), (d), (e), and (f) to make changes similar to the changes made in section 3 of this bill. Section 9 would add a new Insurance Law §§ 1613 and 1614. Section 1613 would require a domestic insurer to pay the expenses of group-wide supervision similar to section 6 of this bill. Section 1614 would provide that the contents of each report and filing submitted under Article 16 and information pertaining thereto must be kept confidential, is not subject to subpoena or discovery, is not admissible in evidence in any private civil action, and may not be made public unless, after notice and opportunity to be heard, the Superintendent determines that the interests of policyholders, subscribers, stockholders, or the public will be served by the publication thereof. It also would state that neither the Superintendent nor any person who received a report or filing submitted pursuant to Article 16 and information pertaining ther- eto, through examination or otherwise, while acting under the authority of the Superintendent or with whom such report or information are shared pursuant to the Insurance Law, will be permitted or required to testify in any private civil action concerning the report, filing, or informa- tion. Section 10 would amend the title of Insurance Law § 1702. Section 11 would add new Insurance Law § 1702(g), (h), (i), and (j) to add definitions. Section 12 would amend Insurance Law § 1709 to expand the applicability of the section and to provide that the information being kept confiden- tial is not subject to discovery and is not admissible in evidence in any private civil action. It also would. provide that neither the Superintendent nor any person who received a report or filing submitted pursuant to Article 17 and information pertaining thereto, through exam- ination or otherwise, while acting under the authority of the Super- intendent or with whom such report or information are shared pursuant to the Insurance Law, will be permitted or required to testify in any private civil action concerning the report, filing, or information. Section 13 would amend Insurance Law § 1710(a) in a manner similar to sections 5 and 7 of this bill. Section 14 would add a new Insurance Law § 1717(c), (d), and (e) to make changes like the changes made in sections 3 and 8 of this bill. Section 15 would add a new Insurance Law § 1718, which would require a parent corporation to pay the expenses of group-wide strpcivii4-fsiini- lar to sections 6 and 9 of this bill. Section 16 would provide for an immediate effective date. JUSTIFICATION: The bill amends the Insurance Law to impose an annual GCC filing requirement, which is necessary to comply with the bilateral agreements between the U.S. and E.U. and U.S. and U.K. on prudential measures regarding insurance and reinsurance. States must have a worldwide group capital calculation in place to avoid the E.U. or U.K. imposing its own GCC on that group and therefore all the U.S. insurers within the group. The GCC will also become an NAIC accreditation standard with which the Department of Financial Services ("DFS") must comply to maintain its accreditation. NAIC accreditation is a certification given to a state insurance regulator once the regulator has demonstrated that it has met and continues to meet baseline solvency regulation standards and various legal, financial, and organizational standards as determined by a committee of its peers. The bill also adds a LST filing requirement, which also will become an NAIC accreditation standard. According to the NAIC, to provide more evidence-based analyses, an NAIC task force developed a LST targeted mainly at large life insurers that aims to capture the impact on the broader financial markets of aggregate asset sales under a liquidity stress event. The primary goal of the LST is to provide quantitative as well as qualitative insights for macroprudential surveillance, such as identifying the amount of asset sales that could occur during a specific stress scenario. The LST also will aid micro prudential regulation. In addition, the bill amends Insurance Law §§ 1506(f), 1603(d), and 1710(a) to provide that a holding company, authorized domestic insurer, or parent corporation, respectively, does not need to file with the Superintendent notice that it is seeking to divest its controlling interest in a domestic insurer if an acquisition of control notice is filed with the Superintendent. This amendment will prevent duplicative notices and is consistent with the NAIC model Insurance Holding Company System Regulatory Act. Finally, the bill amends the Insurance Law to modify or add certain confidentiality provisions to ensure consistency with the model Acts and other states to facilitate the sharing of confi- dential documents between state regulators. Certain other states have been unwilling to share certain confidential information with DFS alleg- ing that the confidentiality provisions set forth in the Insurance Law are inadequate. PRIOR LEGISLATIVE HISTORY: A.10226/S.9006 (2022) FISCAL IMPLICATIONS: None. EFFECTIVE DATE: Immediately
2023-S7095A (ACTIVE) - Bill Text download pdf
S T A T E O F N E W Y O R K ________________________________________________________________________ 7095--A 2023-2024 Regular Sessions I N S E N A T E May 18, 2023 ___________ Introduced by Sen. BRESLIN -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance -- reported favorably from said committee and committed to the Committee on Finance -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the insurance law, in relation to group capital calcu- lations, liquidity stress tests, and confidentiality THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraphs 1 and 2 of subsection (a) and subsection (b) of section 110 of the insurance law, paragraphs 1 and 2 of subsection (a) as amended by chapter 238 of the laws of 2013 and subsection (b) as added by chapter 687 of the laws of 2003, are amended to read as follows: (1) may share documents, materials or other information, including confidential [and], privileged, AND TRADE SECRET documents, materials or information with other LOCAL, state, federal, and international regula- tory agencies, WITH THE NEW YORK LIQUIDATION BUREAU, with the National Association of Insurance Commissioners, its affiliates or subsidiaries, [and] WITH ANY THIRD-PARTY CONSULTANT DESIGNATED BY THE SUPERINTENDENT, with LOCAL, state, federal, and international law enforcement authori- ties, including members of any supervisory college described in section three hundred two of this chapter, provided that the recipient has the authority and agrees to maintain the confidentiality and privileged status of the document, material or other information AND HAS VERIFIED IN WRITING THE LEGAL AUTHORITY TO MAINTAIN CONFIDENTIALITY; provided, however, that this paragraph shall not be construed as limiting access to records pursuant to article six of the public officers law, EXCEPT AS PROVIDED IN PARAGRAPH THREE OF SUBSECTION (B) OF THIS SECTION; (2) may receive documents, materials or information, including other- wise confidential [and], privileged, AND TRADE SECRET documents, materi- EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD08515-05-3
S. 7095--A 2 als or information, from THE NEW YORK LIQUIDATION BUREAU, FROM the National Association of Insurance Commissioners, its affiliates or subsidiaries [and], from regulatory and law enforcement officials of other foreign or domestic jurisdictions, including members of any super- visory college described in section three hundred two of this chapter, AND FROM ANY OTHER ENTITY DESIGNATED BY THE SUPERINTENDENT IN A REGU- LATION, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the laws of the jurisdiction that is the source of the document, material or information; and (b) (1) No waiver of any applicable privilege or claim of confiden- tiality in the documents, materials, or information shall occur as a result of disclosure to the superintendent under this section or as a result of sharing as authorized in this section. (2) THE SHARING OF DOCUMENTS, MATERIALS, OR INFORMATION BY THE SUPER- INTENDENT PURSUANT TO THIS SECTION SHALL NOT CONSTITUTE A DELEGATION OF REGULATORY AUTHORITY OR RULEMAKING, AND THE SUPERINTENDENT IS SOLELY RESPONSIBLE FOR THE ADMINISTRATION, EXECUTION, AND ENFORCEMENT OF THE PROVISIONS OF THIS SECTION. (3) DOCUMENTS, MATERIALS, OR OTHER INFORMATION IN THE POSSESSION OR CONTROL OF THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS OR THIRD- PARTY CONSULTANTS PURSUANT TO THIS SECTION SHALL BE CONFIDENTIAL BY LAW AND PRIVILEGED, SHALL NOT BE SUBJECT TO ARTICLE SIX OF THE PUBLIC OFFI- CERS LAW, SHALL NOT BE SUBJECT TO SUBPOENA, AND SHALL NOT BE SUBJECT TO DISCOVERY OR ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION. § 2. Subsection (a) of section 1501 of the insurance law is amended by adding four new paragraphs 8, 9, 10 and 11 to read as follows: (8) "GROUP CAPITAL CALCULATION INSTRUCTIONS" MEANS THE GROUP CAPITAL CALCULATION INSTRUCTIONS AS ADOPTED BY THE NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC, EXCEPT WHERE SUCH INSTRUCTIONS CONFLICT WITH THE LAWS OF THIS STATE AND SUBJECT TO EXCEPTIONS THE SUPERINTENDENT MAY TAKE IN A REGU- LATION UPON A WRITTEN FINDING THAT THE EXCEPTIONS WOULD NOT BE UNDULY BURDENSOME ON THE HOLDING COMPANY OR INSURER. (9) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. (10) "NAIC LIQUIDITY STRESS TEST FRAMEWORK" MEANS AN NAIC PUBLICATION THAT INCLUDES A HISTORY OF THE NAIC'S DEVELOPMENT OF REGULATORY LIQUIDI- TY STRESS TESTING, THE SCOPE CRITERIA APPLICABLE FOR A SPECIFIC DATA YEAR, AND THE LIQUIDITY STRESS TEST INSTRUCTIONS AND REPORTING TEMPLATES FOR A SPECIFIC DATA YEAR, SUCH SCOPE CRITERIA, INSTRUCTIONS AND REPORT- ING TEMPLATE BEING AS ADOPTED BY THE NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC, EXCEPT WHERE SUCH INSTRUCTIONS CONFLICTS WITH THE LAWS OF THIS STATE AND SUBJECT TO EXCEPTIONS THE SUPERINTENDENT MAY TAKE IN A REGULATION UPON A WRITTEN FINDING THAT THE EXCEPTIONS WOULD NOT BE UNDULY BURDENSOME ON THE HOLDING COMPANY OR INSURER. (11) "SCOPE CRITERIA" MEANS THE DESIGNATED EXPOSURE BASES ALONG WITH MINIMUM MAGNITUDES THEREOF FOR THE SPECIFIED DATA YEAR, USED TO ESTAB- LISH A PRELIMINARY LIST OF INSURERS CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. § 3. Section 1503 of the insurance law is amended by adding three new subsections (c), (d) and (e) to read as follows: (C) (1) AN ULTIMATE HOLDING COMPANY SHALL FILE WITH THE SUPERINTENDENT AN ANNUAL GROUP CAPITAL CALCULATION BY JUNE THIRTIETH OF EACH YEAR WHEN THIS STATE IS THE LEAD STATE OF THE HOLDING COMPANY SYSTEM AS DETERMINED IN ACCORDANCE WITH THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK S. 7095--A 3 ADOPTED BY THE NAIC, AS AMENDED FROM TIME TO TIME. WHEN THE LEAD STATE IS NOT THIS STATE, AN ULTIMATE HOLDING COMPANY SHALL FILE WITH THE SUPERINTENDENT THE ANNUAL GROUP CAPITAL CALCULATION AS ADOPTED BY ITS LEAD STATE IF THE ULTIMATE HOLDING COMPANY HAS FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILL- ING OR ABLE TO SHARE THE ANNUAL GROUP CAPITAL CALCULATION WITH THE SUPERINTENDENT. (2) WHEN THIS STATE IS THE LEAD STATE, THE ULTIMATE HOLDING COMPANY SHALL COMPLETE THE ANNUAL GROUP CAPITAL CALCULATION IN ACCORDANCE WITH THE GROUP CAPITAL CALCULATION INSTRUCTIONS, WHICH MAY PERMIT THE SUPER- INTENDENT TO ALLOW A HOLDING COMPANY THAT IS NOT THE ULTIMATE HOLDING COMPANY TO FILE THE ANNUAL GROUP CAPITAL CALCULATION. (3) WHEN THIS STATE IS THE LEAD STATE, AN ULTIMATE HOLDING COMPANY SHALL BE EXEMPT FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION IF IT IS PART OF A HOLDING COMPANY SYSTEM THAT: (A) HAS ONLY ONE INSURER WITHIN ITS SYSTEM THAT ONLY WRITES BUSINESS AND IS ONLY LICENSED IN ITS DOMESTIC STATE AND ASSUMES NO BUSINESS FROM ANY OTHER INSURER; (B) IS REQUIRED TO PERFORM A GROUP CAPITAL CALCULATION SPECIFIED BY THE UNITED STATES FEDERAL RESERVE BOARD, EXCEPT THAT THE HOLDING COMPANY SHALL NOT BE EXEMPT IF THE SUPERINTENDENT REQUESTS THE GROUP CAPITAL CALCULATION FROM THE UNITED STATES FEDERAL RESERVE BOARD UNDER THE TERMS OF INFORMATION SHARING AGREEMENTS IN EFFECT AND THE FEDERAL RESERVE BOARD CANNOT SHARE THE CALCULATION WITH THE SUPERINTENDENT; (C) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS LOCATED WITHIN A RECIPROCAL JURISDICTION, AS DESCRIBED IN PART ONE HUNDRED TWEN- TY-FIVE OF TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THIS STATE, THAT RECOGNIZES THE UNITED STATES STATE REGU- LATORY APPROACH TO GROUP SUPERVISION AND GROUP CAPITAL; OR (D)(I) PROVIDES INFORMATION TO THE SUPERINTENDENT, EITHER DIRECTLY OR INDIRECTLY THROUGH THE GROUP-WIDE SUPERVISOR, WHO HAS DETERMINED SUCH INFORMATION IS SATISFACTORY TO ALLOW THE SUPERINTENDENT TO COMPLY WITH THE NAIC GROUP SUPERVISION APPROACH, AS DETAILED IN THE NAIC FINANCIAL ANALYSIS HANDBOOK; AND (II) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS NOT IN A RECIPROCAL JURISDICTION THAT RECOGNIZES AND ACCEPTS, AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION, THE GROUP CAPITAL CALCULATION AS THE WORLD-WIDE GROUP CAPITAL ASSESSMENT FOR UNITED STATES HOLDING COMPANY SYSTEMS THAT OPERATE IN THAT JURISDICTION. (4) NOTWITHSTANDING SUBPARAGRAPHS (C) AND (D) OF PARAGRAPH THREE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT SHALL REQUIRE THE GROUP CAPITAL CALCULATION FOR UNITED STATES OPERATIONS OF ANY NON-UNITED STATES-BASED HOLDING COMPANY SYSTEM WHERE, AFTER ANY NECESSARY CONSULTATION WITH OTHER SUPERVISORS OR OFFICIALS, IT IS DEEMED APPROPRIATE BY THE SUPERINTENDENT FOR PRUDENTIAL OVERSIGHT AND SOLVENCY MONITORING PURPOSES OR FOR ENSURING THE COMPETITIVENESS OF THE INSURANCE MARKETPLACE. (5) NOTWITHSTANDING THE EXEMPTIONS FROM FILING THE GROUP CAPITAL CALCULATION SET FORTH IN PARAGRAPH THREE OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT HAS THE DISCRETION TO EXEMPT A HOLDING COMPANY FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION OR ACCEPT A LIMITED GROUP CAPITAL CALCULATION FILING OR REPORT IN ACCORD- ANCE WITH CRITERIA AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION. (6) WHEN THIS STATE IS THE LEAD STATE, IF THE SUPERINTENDENT DETER- MINES THAT A HOLDING COMPANY NO LONGER MEETS ONE OR MORE OF THE REQUIRE- MENTS FOR AN EXEMPTION FROM FILING THE GROUP CAPITAL CALCULATION UNDER S. 7095--A 4 THIS SUBSECTION, THE HOLDING COMPANY SHALL FILE THE GROUP CAPITAL CALCU- LATION AT THE NEXT ANNUAL FILING DATE UNLESS GIVEN AN EXTENSION BY THE SUPERINTENDENT BASED ON REASONABLE GROUNDS SHOWN. (D)(1) AN ULTIMATE HOLDING COMPANY THAT DIRECTLY OR INDIRECTLY CONTROLS AN INSURER SUBJECT TO REGISTRATION AND THAT IS SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK SHALL FILE THE RESULTS OF A SPECIF- IC YEAR'S ANNUAL LIQUIDITY STRESS TEST WITH THE SUPERINTENDENT WHEN THIS STATE IS THE LEAD STATE OF THE HOLDING COMPANY SYSTEM AS DETERMINED BY THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC AND AS AMENDED FROM TIME TO TIME. (2) WHEN THE LEAD STATE IS NOT THIS STATE, AN ULTIMATE HOLDING COMPANY SHALL FILE WITH THE SUPERINTENDENT THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST AS ADOPTED BY ITS LEAD STATE IF THE ULTIMATE HOLD- ING COMPANY HAS FILED THE RESULTS WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE RESULTS WITH THE SUPERINTENDENT. (3) WHEN THIS STATE IS THE LEAD STATE, THE PERFORMANCE OF, AND FILING OF THE RESULTS FROM, A SPECIFIC YEAR'S LIQUIDITY STRESS TEST SHALL COMPLY WITH THE NAIC LIQUIDITY STRESS TEST FRAMEWORK. (4) WHEN THIS STATE IS THE LEAD STATE, ANY CHANGE TO THE NAIC LIQUIDI- TY STRESS TEST FRAMEWORK OR TO THE DATA YEAR FOR WHICH THE SCOPE CRITE- RIA ARE TO BE MEASURED SHALL BE EFFECTIVE ON JANUARY FIRST OF THE YEAR FOLLOWING THE CALENDAR YEAR WHEN SUCH CHANGES ARE ADOPTED. (5) WHEN THIS STATE IS THE LEAD STATE, AN INSURER MEETING AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL NOT BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. (6) WHEN THIS STATE IS THE LEAD STATE, AN INSURER THAT DOES NOT TRIG- GER AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR, UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. (7) THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, SHALL ASSESS THE CONCERN OF WISHING TO AVOID HAVING INSURERS SCOPED IN AND OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK ON A FREQUENT BASIS AS PART OF THE DETERMINATION FOR AN INSURER. (E) NO INSURER, INSURANCE PRODUCER, OR OTHER PERSON SHALL MAKE, PUBLISH, DISSEMINATE, CIRCULATE, ISSUE, OR PLACE BEFORE THE PUBLIC, OR CAUSE DIRECTLY OR INDIRECTLY TO BE MADE, PUBLISHED, DISSEMINATED, CIRCU- LATED, ISSUED, OR PLACED BEFORE THE PUBLIC, IN THIS STATE, IN ANY NEWS- PAPER, MAGAZINE, OR OTHER PUBLICATION, OR IN THE FORM OF A NOTICE, CIRCULAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR TELEVISION STATION OR ANY ELECTRONIC MEANS OF COMMUNICATION AVAILABLE TO THE PUBLIC, OR IN ANY OTHER WAY AS AN ADVERTISEMENT, ANNOUNCEMENT, OR STATE- MENT CONTAINING A REPRESENTATION OR STATEMENT WITH REGARD TO THE GROUP CAPITAL CALCULATION, GROUP CAPITAL RATIO, LIQUIDITY STRESS TEST RESULTS, OR SUPPORTING DISCLOSURES FOR SUCH TEST, OR ANY COMPONENT DERIVED IN THE CALCULATION THEREOF, OF ANY INSURER OR HOLDING COMPANY SYSTEM, PROVIDED, HOWEVER, THAT AN INSURER MAY PUBLISH, WITH THE SUPERINTENDENT'S PRIOR APPROVAL, AN ANNOUNCEMENT IN A WRITTEN PUBLICATION TO REBUT ANY MATE- RIALLY FALSE STATEMENT WITH RESPECT TO THE FOREGOING IF THE INSURER IS ABLE TO DEMONSTRATE TO THE SUPERINTENDENT WITH SUBSTANTIAL PROOF THE S. 7095--A 5 FALSITY OF SUCH STATEMENT OR INAPPROPRIATENESS, AS THE CASE MAY BE, AND IF THE SOLE PURPOSE OF THE ANNOUNCEMENT IS TO REBUT THE MATERIALLY FALSE STATEMENT. § 4. Subsection (c) of section 1504 of the insurance law, as amended by chapter 238 of the laws of 2013, is amended to read as follows: (c) (1) The [superintendent shall keep the] contents of each report AND FILING made pursuant to this article and any information obtained in connection therewith SHALL BE confidential AND PROPRIETARY AND SHALL NOT BE SUBJECT TO SUBPOENA OR DISCOVERY OR ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION, and THE SUPERINTENDENT shall not make the same public without the prior written consent of the controlled insurer to which it pertains unless the superintendent, after notice and an oppor- tunity to be heard, shall determine that the interests of policyholders, shareholders or the public will be served by the publication thereof. In any action or proceeding by the superintendent against the person exam- ined or any other person within the same holding company system a report of such examination published by the superintendent shall be admissible as evidence of the facts stated therein. (2) NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVED A REPORT OR FILING MADE PURSUANT TO THIS ARTICLE AND ANY INFORMATION OBTAINED IN CONNECTION THEREWITH, THROUGH EXAMINATION OR OTHERWISE, WHILE ACTING UNDER THE AUTHORITY OF THE SUPERINTENDENT OR WITH WHOM SUCH REPORT, FILING, OR INFORMATION ARE SHARED PURSUANT TO THIS CHAPTER, SHALL BE PERMITTED OR REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THE REPORT, FILING, OR INFORMATION. § 5. Subsection (f) of section 1506 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: (f) Any holding company seeking to divest its controlling interest in a domestic insurer, in any manner, shall file with the superintendent, with a copy to the insurer, notice of its proposed divestiture at least thirty days prior to the cessation of control, PROVIDED, HOWEVER THAT THIS SUBSECTION SHALL NOT APPLY IF NOTICE IS PROVIDED AS REQUIRED BY SUBSECTION (A) OF THIS SECTION. § 6. The insurance law is amended by adding a new section 1511 to read as follows: § 1511. EXPENSES FOR GROUP-WIDE SUPERVISION. A CONTROLLED INSURER SHALL BE LIABLE FOR AND SHALL PAY THE REASONABLE EXPENSES OF THE SUPER- INTENDENT'S PARTICIPATION IN THE ADMINISTRATION OF GROUP-WIDE SUPER- VISION OF INTERNATIONALLY ACTIVE INSURANCE GROUPS, INCLUDING THE ENGAGE- MENT OF ATTORNEYS, ACTUARIES, AND ANY OTHER PROFESSIONALS AND ALL REASONABLE TRAVEL EXPENSES. § 7. Subsection (d) of section 1603 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: (d) Any domestic insurer seeking to divest its controlling interest in another domestic insurer, in any manner, shall file with the superinten- dent, with a copy to the insurer, notice of its proposed divestiture at least thirty days prior to the cessation of control, PROVIDED, HOWEVER THAT THIS SUBSECTION SHALL NOT APPLY IF NOTICE IS PROVIDED AS REQUIRED BY SUBSECTION (A) OF THIS SECTION. § 8. Section 1604 of the insurance law is amended by adding four new subsections (c), (d), (e) and (f) to read as follows: (C) (1) AN AUTHORIZED DOMESTIC INSURER, OTHER THAN A DOMESTIC INSURER REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, SHALL FILE WITH THE SUPER- INTENDENT AN ANNUAL GROUP CAPITAL CALCULATION BY JUNE THIRTIETH OF EACH YEAR WHEN THIS STATE IS THE LEAD STATE AS DETERMINED IN ACCORDANCE WITH S. 7095--A 6 THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC, AS AMENDED FROM TIME TO TIME. (2) WHEN THE LEAD STATE IS NOT THIS STATE, AN AUTHORIZED DOMESTIC INSURER SHALL FILE WITH THE SUPERINTENDENT THE ANNUAL GROUP CAPITAL CALCULATION AS ADOPTED BY ITS LEAD STATE IF THE AUTHORIZED DOMESTIC INSURER HAS FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE ANNUAL GROUP CAPITAL CALCULATION WITH THE SUPERINTENDENT. (3) WHEN THIS STATE IS THE LEAD STATE, THE AUTHORIZED DOMESTIC INSURER SHALL COMPLETE THE ANNUAL GROUP CAPITAL CALCULATION IN ACCORDANCE WITH THE GROUP CAPITAL CALCULATION INSTRUCTIONS, WHICH MAY PERMIT THE SUPER- INTENDENT TO ALLOW A SUBSIDIARY TO FILE THE ANNUAL GROUP CAPITAL CALCU- LATION. (4) WHEN THIS STATE IS THE LEAD STATE, AN AUTHORIZED DOMESTIC INSURER SHALL BE EXEMPT FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION IF IT: (A) HAS ONLY ONE INSURER SUBSIDIARY THAT ONLY WRITES BUSINESS AND IS ONLY LICENSED IN ITS DOMESTIC STATE AND ASSUMES NO BUSINESS FROM ANY OTHER INSURER; (B) IS REQUIRED TO PERFORM A GROUP CAPITAL CALCULATION SPECIFIED BY THE UNITED STATES FEDERAL RESERVE BOARD, EXCEPT THAT THE AUTHORIZED DOMESTIC INSURER SHALL NOT BE EXEMPT IF THE SUPERINTENDENT REQUESTS THE GROUP CAPITAL CALCULATION FROM THE UNITED STATES FEDERAL RESERVE BOARD UNDER THE TERMS OF INFORMATION SHARING AGREEMENTS IN EFFECT AND THE FEDERAL RESERVE BOARD CANNOT SHARE THE CALCULATION WITH THE SUPERINTEN- DENT; (C) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS LOCATED WITHIN A RECIPROCAL JURISDICTION, AS DESCRIBED IN PART ONE HUNDRED TWEN- TY-FIVE OF TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THIS STATE, THAT RECOGNIZES THE UNITED STATES STATE REGU- LATORY APPROACH TO GROUP SUPERVISION AND GROUP CAPITAL; OR (D)(I) PROVIDES INFORMATION TO THE SUPERINTENDENT, EITHER DIRECTLY OR INDIRECTLY THROUGH THE GROUP-WIDE SUPERVISOR, WHO HAS DETERMINED SUCH INFORMATION IS SATISFACTORY TO ALLOW THE SUPERINTENDENT TO COMPLY WITH THE NAIC GROUP SUPERVISION APPROACH, AS DETAILED IN THE NAIC FINANCIAL ANALYSIS HANDBOOK; AND (II) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS NOT IN A RECIPROCAL JURISDICTION AND THAT RECOGNIZES AND ACCEPTS, AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION, THE GROUP CAPITAL CALCULATION AS THE WORLD-WIDE GROUP CAPITAL ASSESSMENT FOR UNITED STATES SYSTEMS THAT OPER- ATE IN THAT JURISDICTION. (5) NOTWITHSTANDING SUBPARAGRAPHS (C) AND (D) OF PARAGRAPH FOUR OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT SHALL REQUIRE THE GROUP CAPITAL CALCULATION FOR UNITED STATES OPERATIONS OF ANY NON-UNITED STATES-BASED SYSTEM WHERE, AFTER ANY NECESSARY CONSUL- TATION WITH OTHER SUPERVISORS OR OFFICIALS, IT IS DEEMED APPROPRIATE BY THE SUPERINTENDENT FOR PRUDENTIAL OVERSIGHT AND SOLVENCY MONITORING PURPOSES OR FOR ENSURING THE COMPETITIVENESS OF THE INSURANCE MARKET- PLACE. (6) NOTWITHSTANDING THE EXEMPTIONS FROM FILING THE GROUP CAPITAL CALCULATION SET FORTH IN PARAGRAPH FOUR OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT HAS THE DISCRETION TO EXEMPT AN AUTHORIZED DOMESTIC INSURER FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION OR ACCEPT A LIMITED ANNUAL GROUP CAPITAL CALCULATION FILING OR REPORT IN ACCORDANCE WITH CRITERIA AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION. S. 7095--A 7 (7) WHEN THIS STATE IS THE LEAD STATE, IF THE SUPERINTENDENT DETER- MINES THAT AN AUTHORIZED DOMESTIC INSURER NO LONGER MEETS ONE OR MORE OF THE REQUIREMENTS FOR AN EXEMPTION FROM FILING THE GROUP CAPITAL CALCU- LATION UNDER THIS SUBSECTION, THE AUTHORIZED DOMESTIC INSURER SHALL FILE THE GROUP CAPITAL CALCULATION AT THE NEXT ANNUAL FILING DATE UNLESS GIVEN AN EXTENSION BY THE SUPERINTENDENT BASED ON REASONABLE GROUNDS SHOWN. (D)(1) AN AUTHORIZED DOMESTIC INSURER, OTHER THAN A DOMESTIC INSURER REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, THAT HAS A SUBSIDIARY THAT IS SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK SHALL FILE THE RESULTS OF A SPECIFIC YEAR'S ANNUAL LIQUIDITY STRESS TEST WITH THE SUPERINTENDENT WHEN THIS STATE IS THE LEAD STATE AS DETERMINED BY THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC AND AS AMENDED FROM TIME TO TIME. (2) WHEN THE LEAD STATE IS NOT THIS STATE, AN AUTHORIZED DOMESTIC INSURER SHALL FILE WITH THE SUPERINTENDENT THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST AS ADOPTED BY ITS LEAD STATE IF THE AUTHOR- IZED DOMESTIC INSURER HAS FILED THE RESULTS WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE RESULTS WITH THE SUPER- INTENDENT. (3) WHEN THIS STATE IS THE LEAD STATE, THE PERFORMANCE OF, AND FILING OF THE RESULTS FROM, A SPECIFIC YEAR'S LIQUIDITY STRESS TEST SHALL COMPLY WITH THE NAIC LIQUIDITY STRESS TEST FRAMEWORK. (4) WHEN THIS STATE IS THE LEAD STATE, ANY CHANGE TO THE NAIC LIQUIDI- TY STRESS TEST FRAMEWORK OR TO THE DATA YEAR FOR WHICH THE SCOPE CRITE- RIA ARE TO BE MEASURED SHALL BE EFFECTIVE ON JANUARY FIRST OF THE YEAR FOLLOWING THE CALENDAR YEAR WHEN SUCH CHANGES ARE ADOPTED. (5) WHEN THIS STATE IS THE LEAD STATE, AN INSURER MEETING AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL NOT BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. (6) WHEN THIS STATE IS THE LEAD STATE, AN INSURER THAT DOES NOT TRIG- GER AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR, UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. (7) THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, SHALL ASSESS THE CONCERN OF WISHING TO AVOID HAVING INSURERS SCOPED IN AND OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK ON A FREQUENT BASIS AS PART OF THE DETERMINATION FOR AN INSURER. (E) NO INSURER, INSURANCE PRODUCER, OR OTHER PERSON SHALL MAKE, PUBLISH, DISSEMINATE, CIRCULATE, ISSUE, OR PLACE BEFORE THE PUBLIC, OR CAUSE DIRECTLY OR INDIRECTLY TO BE MADE, PUBLISHED, DISSEMINATED, CIRCU- LATED, ISSUED, OR PLACED BEFORE THE PUBLIC, IN THIS STATE, IN A NEWSPA- PER, MAGAZINE, OR OTHER PUBLICATION, OR IN THE FORM OF A NOTICE, CIRCU- LAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR TELEVISION STATION OR ANY ELECTRONIC MEANS OF COMMUNICATION AVAILABLE TO THE PUBLIC, OR IN ANY OTHER WAY AS AN ADVERTISEMENT, ANNOUNCEMENT, OR STATE- MENT CONTAINING A REPRESENTATION OR STATEMENT WITH REGARD TO THE GROUP CAPITAL CALCULATION, GROUP CAPITAL RATIO, LIQUIDITY STRESS TEST RESULTS, S. 7095--A 8 OR SUPPORTING DISCLOSURES FOR SUCH TEST, OR ANY COMPONENT DERIVED IN THE CALCULATION THEREOF, OF ANY AUTHORIZED DOMESTIC INSURER OR SUBSIDIARY THEREOF, PROVIDED, HOWEVER, THAT AN INSURER MAY PUBLISH, WITH THE SUPER- INTENDENT'S PRIOR APPROVAL, ANNOUNCEMENTS IN A WRITTEN PUBLICATION TO REBUT ANY MATERIALLY FALSE STATEMENT WITH RESPECT TO THE FOREGOING IF THE INSURER IS ABLE TO DEMONSTRATE TO THE SUPERINTENDENT WITH SUBSTAN- TIAL PROOF THE FALSITY OF SUCH STATEMENT OR THE INAPPROPRIATENESS, AS THE CASE MAY BE, AND IF THE SOLE PURPOSE OF THE ANNOUNCEMENT IS TO REBUT THE MATERIALLY FALSE STATEMENT. (F) FOR THE PURPOSE OF THIS SECTION: (1) "GROUP CAPITAL CALCULATION INSTRUCTIONS" MEANS THE GROUP CAPITAL CALCULATION INSTRUCTIONS AS ADOPTED BY THE NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC, EXCEPT WHERE SUCH INSTRUCTIONS CONFLICT WITH THE LAWS OF THIS STATE AND SUBJECT TO EXCEPTIONS THE SUPERINTENDENT MAY TAKE IN A REGU- LATION UPON A WRITTEN FINDING THAT THE EXCEPTIONS WOULD NOT BE UNDULY BURDENSOME ON THE DOMESTIC INSURER OR SUBSIDIARY. (2) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. (3) "NAIC LIQUIDITY STRESS TEST FRAMEWORK" MEANS AN NAIC PUBLICATION THAT INCLUDES A HISTORY OF THE NAIC'S DEVELOPMENT OF REGULATORY LIQUIDI- TY STRESS TESTING, THE SCOPE CRITERIA APPLICABLE FOR A SPECIFIC DATA YEAR, AND THE LIQUIDITY STRESS TEST INSTRUCTIONS AND REPORTING TEMPLATES FOR A SPECIFIC DATA YEAR, SUCH SCOPE CRITERIA, INSTRUCTIONS AND REPORT- ING TEMPLATE BEING AS ADOPTED BY THE NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC, EXCEPT WHERE SUCH PUBLICATION CONFLICTS WITH THE LAWS OF THIS STATE AND SUBJECT TO EXCEPTIONS THE SUPERINTENDENT MAY TAKE IN A REGULATION UPON A WRITTEN FINDING THAT THE EXCEPTIONS WOULD NOT BE UNDULY BURDENSOME ON THE DOMESTIC INSURER OR SUBSIDIARY. (4) "SCOPE CRITERIA" MEANS THE DESIGNATED EXPOSURE BASES ALONG WITH MINIMUM MAGNITUDES THEREOF FOR THE SPECIFIED DATA YEAR, USED TO ESTAB- LISH A PRELIMINARY LIST OF INSURERS CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. § 9. The insurance law is amended by adding two new sections 1613 and 1614 to read as follows: § 1613. EXPENSES FOR GROUP-WIDE SUPERVISION. AN AUTHORIZED DOMESTIC INSURER SHALL BE LIABLE FOR AND SHALL PAY THE REASONABLE EXPENSES OF THE SUPERINTENDENT'S PARTICIPATION IN THE ADMINISTRATION OF GROUP-WIDE SUPERVISION OF INTERNATIONALLY ACTIVE INSURANCE GROUPS, INCLUDING THE ENGAGEMENT OF ATTORNEYS, ACTUARIES, AND ANY OTHER PROFESSIONALS AND ALL REASONABLE TRAVEL EXPENSES. § 1614. CONFIDENTIALITY OF REPORTS AND FILINGS. THE CONTENTS OF EACH REPORT AND FILING SUBMITTED PURSUANT TO THIS ARTICLE AND INFORMATION PERTAINING THERETO SHALL BE KEPT CONFIDENTIAL, SHALL NOT BE SUBJECT TO SUBPOENA OR DISCOVERY, SHALL NOT BE ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION, AND SHALL NOT BE MADE PUBLIC UNLESS, AFTER NOTICE AND OPPORTUNITY TO BE HEARD, THE SUPERINTENDENT DETERMINES THAT THE INTERESTS OF POLICYHOLDERS, SUBSCRIBERS, STOCKHOLDERS OR THE PUBLIC WILL BE SERVED BY THE PUBLICATION THEREOF. NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVED A REPORT OR FILING SUBMITTED PURSUANT TO THIS ARTI- CLE AND INFORMATION PERTAINING THERETO, THROUGH EXAMINATION OR OTHER- WISE, WHILE ACTING UNDER THE AUTHORITY OF THE SUPERINTENDENT OR WITH WHOM SUCH REPORT OR INFORMATION ARE SHARED PURSUANT TO THIS CHAPTER, SHALL BE PERMITTED OR REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THE REPORT, FILING, OR INFORMATION. S. 7095--A 9 § 10. The section heading of section 1702 of the insurance law, as amended by chapter 238 of the laws of 2013, is amended to read as follows: [Meaning of "subsidiary", "parent corporation" and "enterprise risk"; certain types of subsidiaries defined] DEFINITIONS. § 11. Section 1702 of the insurance law is amended by adding four new subsections (g), (h), (i) and (j) to read as follows: (G) "GROUP CAPITAL CALCULATION INSTRUCTIONS" MEANS THE GROUP CAPITAL CALCULATION INSTRUCTIONS AS ADOPTED BY THE NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC, EXCEPT WHERE SUCH INSTRUCTIONS CONFLICT WITH THE LAWS OF THIS STATE AND SUBJECT TO EXCEPTIONS THE SUPERINTENDENT MAY TAKE IN A REGU- LATION UPON A WRITTEN FINDING THAT THE EXCEPTIONS WOULD NOT BE UNDULY BURDENSOME ON THE PARENT CORPORATION OR SUBSIDIARY. (H) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. (I) "NAIC LIQUIDITY STRESS TEST FRAMEWORK" MEANS AN NAIC PUBLICATION THAT INCLUDES A HISTORY OF THE NAIC'S DEVELOPMENT OF REGULATORY LIQUIDI- TY STRESS TESTING, THE SCOPE CRITERIA APPLICABLE FOR A SPECIFIC DATA YEAR, AND THE LIQUIDITY STRESS TEST INSTRUCTIONS AND REPORTING TEMPLATES FOR A SPECIFIC DATA YEAR, SUCH SCOPE CRITERIA, INSTRUCTIONS AND REPORT- ING TEMPLATE BEING AS ADOPTED BY THE NAIC AND AS AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE PROCEDURES ADOPTED BY THE NAIC, EXCEPT WHERE SUCH INSTRUCTIONS CONFLICT WITH THE LAWS OF THIS STATE AND SUBJECT TO EXCEPTIONS THE SUPERINTENDENT MAY TAKE IN A REGULATION UPON A WRITTEN FINDING THAT THE EXCEPTIONS WOULD NOT BE UNDULY BURDENSOME ON THE PARENT CORPORATION OR SUBSIDIARY. (J) "SCOPE CRITERIA" MEANS THE DESIGNATED EXPOSURE BASES ALONG WITH MINIMUM MAGNITUDES THEREOF FOR THE SPECIFIED DATA YEAR, USED TO ESTAB- LISH A PRELIMINARY LIST OF INSURERS CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. § 12. Section 1709 of the insurance law, as amended by chapter 381 of the laws of 1986, is amended to read as follows: § 1709. Confidentiality of [information] reports AND FILINGS. The contents of each [information] report [filed hereunder] AND FILING SUBMITTED PURSUANT TO THIS ARTICLE and information pertaining thereto shall be kept confidential, shall not be subject to subpoena OR DISCOV- ERY, SHALL NOT BE ADMISSIBLE IN EVIDENCE IN ANY PRIVATE CIVIL ACTION, and shall not be made public unless, after notice and opportunity to be heard, the superintendent determines that the interests of policyhold- ers, subscribers, stockholders or the public will be served by the publication thereof. The provisions of this section shall not be appli- cable to any [information] report [filed hereunder] OR FILING SUBMITTED PURSUANT TO THIS ARTICLE and any information pertaining thereto, if the parent corporation is a corporation subject to article forty-three of this chapter. NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVED A REPORT OR FILING SUBMITTED PURSUANT TO THIS ARTICLE AND INFORMATION PERTAINING THERETO, THROUGH EXAMINATION OR OTHERWISE, WHILE ACTING UNDER THE AUTHORITY OF THE SUPERINTENDENT OR WITH WHOM SUCH REPORT OR INFORMA- TION ARE SHARED PURSUANT TO THIS CHAPTER, SHALL BE PERMITTED OR REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THE REPORT, FILING, OR INFORMATION. § 13. Subsection (a) of section 1710 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: (a) Any parent corporation seeking to divest its controlling interest in a domestic insurer, in any manner, shall file with the superinten- dent, with a copy to the insurer, notice of its proposed divestiture at S. 7095--A 10 least thirty days prior to the cessation of control, PROVIDED, HOWEVER THAT THIS SUBSECTION SHALL NOT APPLY IF NOTICE IS PROVIDED AS REQUIRED BY SUBSECTION (B) OF SECTION ONE THOUSAND SEVEN HUNDRED ONE OF THIS ARTICLE. § 14. The opening paragraph of paragraph 1 of subsection (b) of section 1712 of the insurance law, as added by chapter 238 of the laws of 2013, is amended to read as follows: sales, purchases, exchanges, loans, extensions of credit, or invest- ments with a [subsidy] SUBSIDIARY, provided the transactions are equal to or exceed: § 15. Section 1717 of the insurance law is amended by adding three new subsections (c), (d) and (e) to read as follows: (C) (1) A PARENT CORPORATION, OTHER THAN A PARENT CORPORATION REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, SHALL FILE WITH THE SUPERINTENDENT AN ANNUAL GROUP CAPITAL CALCULATION BY JUNE THIRTIETH OF EACH YEAR WHEN THIS STATE IS THE LEAD STATE AS DETERMINED IN ACCORDANCE WITH THE PROCE- DURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC, AS AMENDED FROM TIME TO TIME. (2) WHEN THE LEAD STATE IS NOT THIS STATE, A PARENT CORPORATION SHALL FILE WITH THE SUPERINTENDENT THE ANNUAL GROUP CAPITAL CALCULATION AS ADOPTED BY ITS LEAD STATE IF THE PARENT CORPORATION HAS FILED THE ANNUAL GROUP CAPITAL CALCULATION WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE ANNUAL GROUP CAPITAL CALCULATION WITH THE SUPERINTENDENT. (3) WHEN THIS STATE IS THE LEAD STATE, THE PARENT CORPORATION SHALL COMPLETE THE ANNUAL GROUP CAPITAL CALCULATION IN ACCORDANCE WITH THE GROUP CAPITAL CALCULATION INSTRUCTIONS, WHICH MAY PERMIT THE SUPERINTEN- DENT TO ALLOW A SUBSIDIARY TO FILE THE ANNUAL GROUP CAPITAL CALCULATION. (4) WHEN THIS STATE IS THE LEAD STATE, A PARENT CORPORATION SHALL BE EXEMPT FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION IF IT: (A) HAS ONLY ONE INSURER SUBSIDIARY THAT ONLY WRITES BUSINESS AND IS ONLY LICENSED IN ITS DOMESTIC STATE AND ASSUMES NO BUSINESS FROM ANY OTHER INSURER; (B) IS REQUIRED TO PERFORM A GROUP CAPITAL CALCULATION SPECIFIED BY THE UNITED STATES FEDERAL RESERVE BOARD, EXCEPT THAT THE PARENT CORPO- RATION SHALL NOT BE EXEMPT IF THE SUPERINTENDENT REQUESTS THE GROUP CAPITAL CALCULATION FROM THE UNITED STATES FEDERAL RESERVE BOARD UNDER THE TERMS OF INFORMATION SHARING AGREEMENTS IN EFFECT AND THE FEDERAL RESERVE BOARD CANNOT SHARE THE CALCULATION WITH THE SUPERINTENDENT; (C) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS LOCATED WITHIN A RECIPROCAL JURISDICTION, AS DESCRIBED IN PART ONE HUNDRED TWEN- TY-FIVE OF TITLE ELEVEN OF THE OFFICIAL COMPILATION OF CODES, RULES AND REGULATIONS OF THIS STATE, THAT RECOGNIZES THE UNITED STATES STATE REGU- LATORY APPROACH TO GROUP SUPERVISION AND GROUP CAPITAL; OR (D)(I) PROVIDES INFORMATION TO THE SUPERINTENDENT, EITHER DIRECTLY OR INDIRECTLY THROUGH THE GROUP-WIDE SUPERVISOR, WHO HAS DETERMINED SUCH INFORMATION IS SATISFACTORY TO ALLOW THE SUPERINTENDENT TO COMPLY WITH THE NAIC GROUP SUPERVISION APPROACH, AS DETAILED IN THE NAIC FINANCIAL ANALYSIS HANDBOOK; AND (II) HAS A NON-UNITED STATES GROUP-WIDE SUPERVISOR THAT IS NOT IN A RECIPROCAL JURISDICTION THAT RECOGNIZES AND ACCEPTS, AS SPECIFIED BY THE SUPERINTENDENT IN A REGULATION, THE GROUP CAPITAL CALCULATION AS THE WORLD-WIDE GROUP CAPITAL ASSESSMENT FOR UNITED STATES SYSTEMS THAT OPER- ATE IN THAT JURISDICTION. S. 7095--A 11 (5) NOTWITHSTANDING SUBPARAGRAPHS (C) AND (D) OF PARAGRAPH FOUR OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT SHALL REQUIRE THE GROUP CAPITAL CALCULATION FOR UNITED STATES OPERATIONS OF ANY NON-UNITED STATES-BASED SYSTEM WHERE, AFTER ANY NECESSARY CONSUL- TATION WITH OTHER SUPERVISORS OR OFFICIALS, IT IS DEEMED APPROPRIATE BY THE SUPERINTENDENT FOR PRUDENTIAL OVERSIGHT AND SOLVENCY MONITORING PURPOSES OR FOR ENSURING THE COMPETITIVENESS OF THE INSURANCE MARKET- PLACE. (6) NOTWITHSTANDING THE EXEMPTIONS FROM FILING THE GROUP CAPITAL CALCULATION SET FORTH IN PARAGRAPH FOUR OF THIS SUBSECTION, WHEN THIS STATE IS THE LEAD STATE, THE SUPERINTENDENT HAS THE DISCRETION TO EXEMPT A PARENT CORPORATION FROM FILING AN ANNUAL GROUP CAPITAL CALCULATION OR ACCEPT A LIMITED ANNUAL GROUP CAPITAL CALCULATION FILING OR REPORT IN ACCORDANCE WITH CRITERIA AS SPECIFIED BY THE SUPERINTENDENT IN A REGU- LATION. (7) WHEN THIS STATE IS THE LEAD STATE, IF THE SUPERINTENDENT DETER- MINES THAT A PARENT CORPORATION NO LONGER MEETS ONE OR MORE OF THE REQUIREMENTS FOR AN EXEMPTION FROM FILING THE GROUP CAPITAL CALCULATION UNDER THIS SUBSECTION, THE PARENT CORPORATION SHALL FILE THE GROUP CAPI- TAL CALCULATION AT THE NEXT ANNUAL FILING DATE UNLESS GIVEN AN EXTENSION BY THE SUPERINTENDENT BASED ON REASONABLE GROUNDS SHOWN. (D)(1) A PARENT CORPORATION, OTHER THAN A PARENT CORPORATION REQUIRED TO REGISTER AS A CONTROLLED INSURER PURSUANT TO SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS CHAPTER, THAT HAS A SUBSIDIARY THAT IS SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK SHALL FILE THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST WITH THE SUPERINTENDENT WHEN THIS STATE IS THE LEAD STATE AS DETERMINED BY THE PROCEDURES WITHIN THE FINANCIAL ANALYSIS HANDBOOK ADOPTED BY THE NAIC AND AS AMENDED FROM TIME TO TIME. (2) WHEN THE LEAD STATE IS NOT THIS STATE, A PARENT CORPORATION SHALL FILE WITH THE SUPERINTENDENT THE RESULTS OF A SPECIFIC YEAR'S LIQUIDITY STRESS TEST AS ADOPTED BY ITS LEAD STATE IF THE PARENT CORPORATION HAS FILED THE RESULTS WITH THE LEAD STATE BUT THE LEAD STATE IS NOT WILLING OR ABLE TO SHARE THE RESULTS WITH THE SUPERINTENDENT. (3) WHEN THIS STATE IS THE LEAD STATE, THE PERFORMANCE OF, AND FILING OF THE RESULTS FROM, A SPECIFIC YEAR'S LIQUIDITY STRESS TEST SHALL COMPLY WITH THE NAIC LIQUIDITY STRESS TEST FRAMEWORK. (4) WHEN THE LEAD STATE IS THIS STATE, ANY CHANGE TO THE NAIC LIQUIDI- TY STRESS TEST FRAMEWORK OR TO THE DATA YEAR FOR WHICH THE SCOPE CRITE- RIA ARE TO BE MEASURED SHALL BE EFFECTIVE ON JANUARY FIRST OF THE YEAR FOLLOWING THE CALENDAR YEAR WHEN SUCH CHANGES ARE ADOPTED. (5) WHEN THIS STATE IS THE LEAD STATE, AN INSURER MEETING AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL NOT BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. (6) WHEN THIS STATE IS THE LEAD STATE, AN INSURER THAT DOES NOT TRIG- GER AT LEAST ONE THRESHOLD OF THE SCOPE CRITERIA SHALL BE CONSIDERED SCOPED OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THE SPECIFIED DATA YEAR, UNLESS THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, DETERMINES THE INSURER SHALL BE SCOPED INTO THE NAIC LIQUIDITY STRESS TEST FRAMEWORK FOR THAT DATA YEAR. (7) THE SUPERINTENDENT, IN CONSULTATION WITH THE NAIC FINANCIAL STABILITY TASK FORCE, OR ITS SUCCESSOR, SHALL ASSESS THE CONCERN OF S. 7095--A 12 WISHING TO AVOID HAVING INSURERS SCOPED IN AND OUT OF THE NAIC LIQUIDITY STRESS TEST FRAMEWORK ON A FREQUENT BASIS AS PART OF THE DETERMINATION FOR AN INSURER. (E) NO INSURER, INSURANCE PRODUCER, OR OTHER PERSON SHALL MAKE, PUBLISH, DISSEMINATE, CIRCULATE, ISSUE, OR PLACE BEFORE THE PUBLIC, OR CAUSE DIRECTLY OR INDIRECTLY TO BE MADE, PUBLISHED, DISSEMINATED, CIRCU- LATED, ISSUED, OR PLACED BEFORE THE PUBLIC, IN THIS STATE, IN A NEWSPA- PER, MAGAZINE, OR OTHER PUBLICATION, OR IN THE FORM OF A NOTICE, CIRCU- LAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR TELEVISION STATION OR ANY ELECTRONIC MEANS OF COMMUNICATION AVAILABLE TO THE PUBLIC, OR IN ANY OTHER WAY AS AN ADVERTISEMENT, ANNOUNCEMENT, OR STATE- MENT CONTAINING A REPRESENTATION OR STATEMENT WITH REGARD TO THE GROUP CAPITAL CALCULATION, GROUP CAPITAL RATIO, LIQUIDITY STRESS TEST RESULTS OR SUPPORTING DISCLOSURES FOR SUCH TEST, OR ANY COMPONENT DERIVED IN THE CALCULATION THEREOF, OF ANY PARENT CORPORATION OR SUBSIDIARY THEREOF, PROVIDED, HOWEVER, THAT A PARENT CORPORATION MAY PUBLISH, WITH THE SUPERINTENDENT'S PRIOR APPROVAL, ANNOUNCEMENTS IN A WRITTEN PUBLICATION TO REBUT ANY MATERIALLY FALSE STATEMENT WITH RESPECT TO THE FOREGOING IF THE INSURER IS ABLE TO DEMONSTRATE TO THE SUPER- INTENDENT WITH SUBSTANTIAL PROOF THE FALSITY OF SUCH STATEMENT OR THE INAPPROPRIATENESS, AS THE CASE MAY BE, AND IF THE SOLE PURPOSE OF THE ANNOUNCEMENT IS TO REBUT THE MATERIALLY FALSE STATEMENT. § 16. The insurance law is amended by adding a new section 1718 to read as follows: § 1718. EXPENSES FOR GROUP-WIDE SUPERVISION. A PARENT CORPORATION SHALL BE LIABLE FOR AND SHALL PAY THE REASONABLE EXPENSES OF THE SUPER- INTENDENT'S PARTICIPATION IN THE ADMINISTRATION OF GROUP-WIDE SUPER- VISION OF INTERNATIONALLY ACTIVE INSURANCE GROUPS, INCLUDING THE ENGAGE- MENT OF ATTORNEYS, ACTUARIES, AND ANY OTHER PROFESSIONALS AND ALL REASONABLE TRAVEL EXPENSES. § 17. This act shall take effect immediately.
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