§ 25.23. Adequacy of surplus.
The factors in section 1405(d) of the act (40 P. S. § 991.1405(d)) to be considered in determining whether an insurer’s surplus is reasonable in relation to the insurer’s outstanding liabilities and adequate to its financial needs are not intended to be an exhaustive list. In determining the adequacy and reasonableness of an insurer’s surplus, no single factor is necessarily controlling. The Commissioner will consider the net effect of these factors plus other factors bearing on the financial condition of the insurer. In comparing the surplus maintained by other insurers, the Commissioner will consider the extent to which each of these factors varies from company to company. In determining the quality and liquidity of investments in subsidiaries, the Commissioner will consider the individual subsidiary and may discount or disallow its valuation to the extent that the individual investments so warrant.
Authority The provisions of this § 25.23 issued under Article XIV of The Insurance Company Law of 1921 (40 P. S. § § 991.1401—991.1413); amended under section 337.8 of The Insurance Company Law of 1921 (40 P. S. § 459.8).
Source The provisions of this § 25.23 adopted September 3, 1993, effective September 4, 1993, 23 Pa.B. 4216; amended August 10, 2001, effective August 11, 2001, 31 Pa.B. 4406. Immediately preceding text appears at serial page (245453).
APPENDIX A
FORM A
STATEMENT REGARDING THE ACQUISITION OF CONTROL OF OR MERGER WITH A DOMESTIC INSURER
(Name of Domestic Insurer)
BY: (Name of Acquiring Person (Applicant))
Filed with the Insurance Department of the Commonwealth of Pennsylvania
Dated:
Name, title, address and telephone number of individual to whom notices and correspondence concerning this form should be addressed:
Item 1. Insurer and Method of Acquisition
State the name, NAIC code number and address of the domestic insurer to which this application relates and a brief description of how control is to be acquired.
Item 2. Identity and Background of the Applicant
A. State the name and address of the applicant seeking to acquire control over the insurer.
B. If the applicant is not an individual, state the nature of its business operations for the past five (5) years or for such lesser period as the person and any predecessors thereof shall have been in existence. Briefly describe the business intended to be done by the applicant and the applicant’s subsidiaries.
C. Furnish a chart or listing clearly presenting the identities and the interrelationships among the applicant and all affiliates of the applicant. Indicate in the chart or listing the percentage of voting securities of each person which is owned or controlled by the applicant or by any other person. If control of any person is maintained other than by the ownership or control of voting securities, indicate the basis of control. As to each person specified in the chart or listing indicate the type of organization (e.g. corporation, trust, partnership) and the state or other jurisdiction of domicile. If court proceedings involving a reorganization or liquidation are pending with respect to any such person, indicate which person, and set forth the title of the court, nature of proceedings and the date when commenced.
Item 3. Identity and Background of Individuals Associated with the Applicant
Furnish a third-party background check upon request and biographical affidavit for (1) the applicant if the applicant is an individual or (2) all persons who are directors, executive officers or owners of 10% or more of the voting securities of the applicant if the applicant is not an individual. Biographical affidavits filed with the Department within the immediately preceding 3 years need not be included if there has been no change in the information already on file.
Biographical affidavits shall be signed in the original and shall include the following:
A. Name and business address.
B. Present principal business activity, occupation or employment including position and office held and the name, principal business and address of any corporation or other organization in which employment is carried on.
C. Material occupations, positions, offices or employment during the last five (5) years, giving the starting and ending date of each and the name, principal business and address of any business corporation or other organization in which each occupation, position, office or employment was carried on. If any occupation, position, office or employment required licensing by or registration with any Federal, state or municipal governmental agency, indicate that fact, the current status of the licensing or registration, and an explanation of any surrender, revocation, suspension or disciplinary proceedings in connection therewith.
D. Whether or not the person has ever been convicted in a criminal proceeding (excluding minor traffic violations) during the last ten (10) years and, if so, give the date, nature of conviction, name and location of court, and penalty imposed or other disposition of the case.
The Department will accept copies of original, signed biographical affidavits filed with the chief insurance regulatory official of another jurisdiction if the following conditions are met:
(1) The identity of the chief insurance regulatory official holding the original affidavit and the date of the original filing are provided in this statement.
(2) The original affidavit was filed within the immediately preceding three years.
(3) There has been no change in the information required in the affidavit.
Item 4. Nature, Source and Amount of Consideration
A. Describe the nature, source and amount of funds or other considerations used or to be used in effecting the merger or other acquisition of control. If any part of the same is represented or is to be represented by funds or other consideration borrowed or otherwise obtained for the purpose of acquiring, holding or trading securities, furnish a description of the transaction, the names of the parties thereto, the relationship, if any, between the borrower, and the lender, the amounts borrowed or to be borrowed, and copies of all agreements, promissory notes and security arrangements relating thereto.
B. Explain the criteria used in determining the nature and amount of the consideration.
C. If the source of the consideration is a loan made in the lender’s ordinary course of business and if the applicant wishes the identity of the lender to remain confidential, the applicant must specifically request that the identity be kept confidential.
Item 5. Future Plans of Insurer
Describe any plans or proposals which the applicant may have to declare an extraordinary dividend, to liquidate the insurer, to sell its assets to or merge it with any person or persons or to make any other material change in its business operations or corporate structure or management.
Item 6. Voting Securities to be Acquired
State the number of shares of the insurer’s voting securities which the applicant, its affiliates and any person listed in Item 3 plan to acquire, and the terms of the offer, request, invitation, agreement or acquisition, and a statement as to the method by which the fairness of the proposal was arrived at.
Item 7. Ownership of Voting Securities
State the amount of each class of any voting security of the insurer which is beneficially owned or concerning which there is a right to acquire beneficial ownership by the applicant, its affiliates or any person listed in Item 3.
Item 8. Contracts, Arrangements, or Understandings with Respect to Voting Securities of the Insurer
Give a full description of any contracts, arrangements or understandings with respect to any voting security of the insurer in which the applicant, its affiliates or any person listed in Item 3 is involved, including, but not limited to, transfer of any of the securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or guarantees of profits, division of losses or profits, or the giving or withholding of proxies. The description shall identify the person with whom such contracts, arrangements or understandings have been entered into.
Item 9. Recent Purchases of Voting Securities
Describe any purchases of any voting securities of the insurer by the applicant, its affiliates or any person listed in Item 3 during the twelve (12) calendar months preceding the filing of this statement.
Include in the description the dates of purchase, the name of the purchasers, and the consideration paid or agreed to be paid therefor.
State whether any shares so purchased are hypothecated.
Item 10. Recent Recommendations to Purchase
Describe any recommendations to purchase any voting security of the insurer made by the applicant, its affiliates or any person listed in Item 3, or by anyone based upon interviews or at the suggestion of the applicant, its affiliates or any person listed in Item 3 during the twelve (12) calendar months preceding the filing of this statement.
Item 11. Agreements with Broker-Dealers
Describe the terms of any agreement, contract or understanding made with any broker-dealer as to solicitation of voting securities of the insurer for tender and the amount of any fees, commissions or other compensation to be paid to broker-dealers with regard thereto.
Item 12. Financial Statements and Exhibits
A. Financial statements and exhibits, and three-year financial projection of the insurer(s) shall be attached to this statement as an appendix, but list under this item the financial statements and exhibits so attached.
B. The financial statements shall include the annual financial statements of the persons identified in Item 2(c) for the preceding five (5) fiscal years (or for such lesser period as the applicant and its affiliates and any predecessors thereof shall have been in existence), and similar information covering the period from the end of the person’s last fiscal year, if that information is available. Statements may be prepared on either an individual basis, or, unless the Commissioner otherwise requires, on a consolidated basis if consolidated statements are prepared in the usual course of business.
The annual financial statements of the applicant shall be accompanied by the certificate of an independent public accountant to the effect that the statements present fairly the financial position of the applicant and the results of its operations for the year then ended, in conformity with generally accepted accounting principles or with requirements of insurance or other accounting principles or permitted under law. If the applicant is an insurer which is actively engaged in the business of insurance, the financial statements need not be certified, provided they are based on the Annual Statement of that person filed with the insurance department of the person’s domiciliary state and are in accordance with the requirements of insurance or other accounting principles prescribed or permitted under the law and regulations of that state.
C. If the acquiring person is an individual, the Department may require the filing of Federal income tax returns in lieu of audited financial statements. Any returns filed shall be given confidential treatment and shall not be subject to subpoena and shall not be made public by the Department or any other person.
D. File as exhibits copies of all tender offers for, requests or invitations for, tenders of, exchange offers for, and agreements to acquire or exchange any voting securities of the insurer and (if distributed) of additional soliciting material relating thereto, any proposed employment, consultation, advisory or management contracts concerning the insurer, annual reports to the stockholders of the insurer and the applicant for the last two fiscal years, and any additional documents or papers required by this chapter.
Item 13. Agreement Requirements for Enterprise Risk Management
Applicant agrees to provide, to the best of its knowledge and belief, the information required by Form F within thirty (30) days after the end of the month in which the acquisition of control occurs and annually thereafter as long as control exists or upon request as necessary for the Commissioner to evaluate enterprise risk of the insurer unless otherwise ordered by the Commissioner.
Item 14. Signature and Certification
Signature and certification required as follows:
SIGNATURE
Pursuant to the requirements of Section 1402 of the act
has caused this application to be duly signed on its behalf in the City of
and State of
on the
day of
,
.(SEAL)
Name of Applicant
BY (Name) (Title)
Attest:
(Signature of Officer)
(Title)
CERTIFICATION The undersigned deposes and says that (s)he has duly executed the attached application dated
,
, for and on behalf of
;
(Name of Applicant)
that (s)he is the
of such company and that (s)he is (Title of Officer)
authorized to execute and file such instrument. Deponent further says that (s)he is familiar with such instrument and the contents thereof, and that the facts therein set forth are true to the best of his/her knowledge, information and belief.(Signature)
(Type or print name beneath)
FORM B
INSURANCE HOLDING COMPANY SYSTEM ANNUAL REGISTRATION STATEMENT
Filed with the Insurance Department of the Commonwealth of Pennsylvania by (Name of Registrant) on behalf of the following insurance companies:
Name Address
NAIC Code Number State of Domicile
Date:
,
Name, title, address and telephone number of individual to whom notices and correspondence concerning this statement should be addressed:
Item 1. Identity and Control of Registrant
Furnish the exact name of each insurer registering or being registered (hereinafter called ‘‘the Registrant’’), the home office address and principal executive offices of each; the date on which each Registrant became part of the insurance holding company system; and the method(s) by which control of each Registrant was acquired and is maintained.
Item 2. Organizational Chart
Furnish a chart or listing clearly presenting the identities of and interrelationships among all affiliated persons within the insurance holding company system. The chart or listing should show the percentage of each class of voting securities of each affiliate which is owned, directly or indirectly, by another affiliate.
If control of any person within the system is maintained other than by the ownership or control of voting securities, indicate the basis of such control. As to each person specified in the chart or listing indicate the type of organization (e.g., corporation, trust, partnership) and the state or other jurisdiction of domicile.
Item 3. Ultimate Controlling Person
As to an ultimate controlling person in the insurance holding company system furnish the following information:
A. Name.
B. Home office address.
C. Principal executive office address.
D. The organizational structure of the person, i.e., corporation, partnership, individual, trust, etc.
E. The principal business of the person.
F. The name and address of any person who holds or owns 10% or more of any class of voting security, the class of the security, the number of shares held of record or known to be beneficially owned, and the percentage of class so held or owned.
G. If court proceedings involving a reorganization or liquidation are pending, indicate the title and location of the court, the nature of proceedings and the date when commenced.
Item 4. Biographical Information
If the ultimate controlling person is a corporation, an organization, a limited liability company, or other legal entity, furnish the following information for the directors and executive officers of an ultimate controlling person in the form of biographical affidavits signed in the original: the individual’s name and address, his or her principal occupation and all offices and positions held during the past five years, and any conviction of crimes other than minor traffic violations during the past five years. If the ultimate controlling person is an individual, furnish the following information in the form of a biographical affidavit signed in the original: the individual’s name and address, his or her principal occupation and all offices and positions held during the past five years, and any conviction of crimes other than minor traffic violations. Biographical affidavits filed with the Department within the immediately preceding three years need not be included if there has been no change in the information already on file. The Department will accept copies of original, signed biographical affidavits filed with the chief insurance regulatory official of another jurisdiction if the following conditions are met:
(1) The identity of the chief insurance regulatory official holding the original affidavit and the date of the original filing are provided in this statement.
(2) The original affidavit was filed within the immediately preceding 3 years.
(3) There has been no change in the information required in the affidavit.
Item 5. Transactions and Agreements
Briefly describe the following agreements in force, and transactions currently outstanding or which have occurred during the last calendar year, including extraordinary dividends and other material transactions reported under § § 25.21 and 25.22 of this chapter, between the Registrant and its affiliates:
A. Loans, other investments, or purchases, sales or exchanges of securities of the affiliates by the Registrant or of the Registrant by its affiliates;
B. Purchases, sales or exchanges of assets;
C. Transactions not in the ordinary course of business, including contributions of assets to Registrant;
D. Guarantees or undertakings for the benefit of an affiliate which result in an actual contingent exposure of the Registrant’s assets to liability, other than insurance contracts entered into in the ordinary course of the Registrant’s business;
E. All management agreements, service contracts and all cost-sharing arrangements;
F. Reinsurance agreements;
G. Dividends and other distributions to shareholders;
H. Tax allocation agreements; and
I. Any pledge of the Registrant’s stock and/or of the stock of any subsidiary or controlling affiliate, for a loan made to any member of the insurance holding company system.
Sales, purchases, exchanges, loans or extensions of credit, investments or guarantees involving one-half of 1% or less of the Registrant’s admitted assets as of the 31st day of December next preceding shall not be deemed material and need not be disclosed.
The description shall be in a manner as to permit the proper evaluation thereof by the Commissioner, and shall include at least the following: the effective date, nature and purpose of the transaction, the nature and amounts of any payments or transfers of assets between the parties, the identity of all parties to the transaction, and relationship of the affiliated parties to the Registrant.
Item 6. Litigation or Administrative Proceedings
A brief description of any litigation or administrative proceedings of the following types, either then pending or concluded within the preceding fiscal year, to which an ultimate controlling person or any of its directors or executive officers was a party or of which the property of an ultimate controlling person or any of its directors or executive officers is or was the subject; give the names of the parties and the court or agency in which the litigation or proceeding is or was pending:
A. Criminal prosecutions or administrative proceedings by any government agency or authority which may be relevant to the trustworthiness of any party thereto; and
B. Proceedings which may have a material effect upon the solvency or capital structure of an ultimate controlling person including, but not necessarily limited to, bankruptcy, receivership or other corporate reorganizations.
Item 7. Statement Regarding Plan or Series of Transactions
The insurer shall furnish a statement that transactions entered into since the filing of the prior year’s annual registration statement are not part of a plan or series of like transactions, the purpose of which is to avoid statutory threshold amounts and the review that might otherwise occur.
Item 8. Financial Statements and Exhibits
A. Financial statements and exhibits should be attached to this statement as an appendix, but list under this item the financial statements and exhibits so attached.
B. If the ultimate controlling person is a corporation, an organization, a limited liability company, or other legal entity, the financial statements shall include the annual financial statements of any ultimate controlling person in the insurance holding company system as of the end of the person’s latest fiscal year. Financial statements are required for an ultimate controlling person who is an individual as well as for a corporation or other type of business organization.
If a holding company system includes more than one ultimate controlling person, annual financial statements are required for each ultimate controlling person unless the Commissioner, in the Commissioner’s discretion, finds that annual financial statements for one or more of the ultimate controlling persons are not necessary to carry out the act.
If at the time of the initial registration, the annual financial statements for the latest fiscal year are not available, annual statements for the previous fiscal year may be filed and similar financial information shall be filed for any subsequent period to the extent that information is available. Financial statements may be prepared on either an individual basis, or unless the Commissioner otherwise requires, on a consolidated basis if the consolidated statements are prepared in the usual course of business.
Other than with respect to the foregoing, such financial statement shall be filed in a standard form and format adopted by the NAIC unless an alternative form is accepted by the Commissioner. Documentation and financial statements filed with the Securities and Exchange Commission or audited GAAP financial statements shall be deemed to be an appropriate form and format.
Unless the Commissioner otherwise permits, the annual financial statements shall be accompanied by the certificate of an independent public accountant to the effect that the statements present fairly the financial position of an ultimate controlling person and the results of its operations for the year then ended, in conformity with generally accepted accounting principles or with requirements of insurance or other accounting principles prescribed or permitted under law. If an ultimate controlling person is an insurer which is actively engaged in the business of insurance, the annual financial statements need not be certified, provided they are based on the Annual Statement filed in the insurer’s domiciliary jurisdiction and are in accordance with requirements of insurance or other accounting principles prescribed or permitted under the law and regulations of that jurisdiction. Any ultimate controlling person who is an individual may file personal financial statements that are reviewed rather than audited by an independent public accountant. The review shall be conducted in accordance with standards for review of personal financial statements published in the Personal Financial Statements Guide by the American Institute of Certified Public Accountants. Personal financial statements shall be accompanied by the independent public accountant’s Standard Review Report stating that the accountant is not aware of any material modifications that should be made to the financial statements in order for the statements to be in conformity with generally accepted accounting principles.
C. Exhibits shall include copies of the latest annual reports to shareholders of an ultimate controlling person and proxy material used by an ultimate controlling person; and any additional documents or papers required by this chapter.
Item 9. Form C Required
A Form C, Summary of Registration Statement, must be prepared and filed with this Form B.
Item 10. Corporate Governance and Internal Controls
The insurer shall furnish a statement that the insurer’s board of directors oversees corporate governance and internal controls and that the insurer’s officers or senior management have approved, implemented and will continue to maintain and monitor corporate governance and internal control procedures.
Item 11. Signature and Certification
SIGNATURE
Pursuant to the requirements of Section 1404 of the act, the Registrant has caused this annual registration statement to be duly signed on its behalf in the City of
and State of
on the
day of
,
.(SEAL)
Name of Registrant
BY (Name) (Title)
Attest:
(Signature of Officer)
(Title)
CERTIFICATION The undersigned deposes and says that (s)he has duly executed the attached annual registration statement dated
,
, for and on behalf of
; that (s)he is the
(Name of Company)
of such company and that (s)he is authorized to execute (Title of Officer)
and file such instrument. Deponent further says that (s)he is familiar with such instrument and the contents thereof, and that the facts therein set forth are true to the best of his/her knowledge, information and belief.(Signature)
(Type or print name beneath)
FORM D
PRIOR NOTICE OF A TRANSACTION
Filed with the Insurance Department of the Commonwealth of Pennsylvania by (Name of Registrant) on behalf of the following insurance companies:
Name Address
NAIC Code Number State of Domicile
Date:
,
Name, title, address and telephone number of individual to whom notices and correspondence concerning this statement should be addressed:
Item 1. Identity of Parties to Transaction
Furnish the following information for each of the parties to the transaction:
A. Name.
B. Home office address.
C. Principal executive office address.
D. The organizational structure, i.e. corporation, partnership, individual, trust, etc.
E. A description of the nature of the parties’ business operations.
F. Relationship, if any, of other parties to the transaction to the insurer filing the notice, including any ownership or debtor/creditor interest by any other parties to the transaction in the insurer seeking approval, or by the insurer filing the notice in the affiliated parties.
G. If the transaction is with a non-affiliate, the name(s) of the affiliate(s) which will receive, in whole or in substantial part, the proceeds of the transaction.
Item 2. Description of the Transaction
Furnish the following information for each transaction for which notice is being given:
A. A statement as to whether notice is being given under Section 1405(a)(2)(i), (ii), (iii), or (iv) or (v) of the act.
B. A description of the nature and purpose of the transaction, including the anticipated immediate and long-term effect of the transaction on the financial condition of the insurer.
C. A statement of how the transaction meets the fair and reasonable standard of section 1405(a)(1)(i) of the Act (40 P. S. § 991.1405(a)(1)(i)).
D. The proposed effective date of the transaction.
E. A copy of the management agreement, service contracts, tax allocation agreement, guarantee or cost-sharing arrangement.
Item 3. Sales, Purchases, Exchanges, Loans, Extensions of Credit, Guarantees, Investments, Pledges of Assets or Contributions to Surplus equal to or exceeding 3% of the insurer’s admitted assets or 25% of surplus as regards policyholders reported pursuant to 40 P. S. § 991.1405(a)(2)(i). Furnish a brief description of the amount and source of funds, securities, property or other consideration for the sale, purchase, exchange, loan, extension of credit, guarantee, investment, or pledge of assets, including assets to be received by the domestic insurer as a contribution to its surplus; whether any provision exists for purchase by the insurer filing notice, by any party to the transaction, or by any affiliate of the insurer filing notice; a description of the terms of any securities being received, if any; and a description of any other agreements relating to the transaction such as contracts or agreements for services, consulting agreements and the like. If the transaction involves other than cash, furnish a description of the consideration, its cost and its fair market value, together with an explanation and supporting documentation of the basis for valuation.
If the transaction involves a loan, extension of credit or a guarantee, furnish a description of the maximum amount which the insurer will be obligated to make available under the loan, extension of credit or guarantee, the date on which the credit or guarantee will terminate, and any provisions for the accrual of or deferral of interest.
If the transaction involves an investment, guarantee or other arrangement, state the time period during which the investment, guarantee or other arrangement will remain in effect, together with any provisions for extensions or renewals of the investments, guarantees or arrangements. Furnish a brief statement as to the effect of the transaction upon the insurer’s surplus and the insurer’s accounting treatment.
No notice need be given under this item if the maximum amount which can at any time be outstanding or for which the insurer can be legally obligated under the loan, extension of credit or guarantee is less than 3% of the insurer’s admitted assets or 25% of its surplus as of the 31st day of December next preceding. Please see item 6 for the reporting of matters below these thresholds.
Item 4. Loans or Extensions of Credit to a Non-Affiliate
If the transaction involves a loan or extension of credit to any person who is not an affiliate, furnish a brief description of the agreement or understanding whereby the proceeds of the proposed transaction, in whole or in substantial part, are to be used to make loans or extensions of credit to, to purchase the assets of, or to make investments in, any affiliate of the insurer making the loans or extensions of credit, and specify in what manner the proceeds are to be used to loan to, extend credit to, purchase assets of or make investments in any affiliate. Describe the amount and source of funds, securities, property or other consideration for the loan or extension of credit and, if the transaction is one involving consideration other than cash, a description of its cost and its fair market value together with an explanation of and supporting documentation for the basis of valuation. Furnish a brief statement as to the effect of the transaction upon the insurer’s surplus.
No notice need be given if the loan or extension of credit is one which equals less than 3% of the insurer’s admitted assets or 25% of its surplus as of the 31st day of December next preceding.
Item 5. Reinsurance
If the transaction is a reinsurance agreement or modification thereto, as described by Section 1405(a)(2)(iii) of the act or a reinsurance pooling agreement or modification thereto as described by Section 1405(a)(2)(iii)(C) of the act, furnish a description of the known and/or estimated amount of liability to be ceded and/or assumed in each calendar year, the period of time during which the agreement will be in effect, and a statement whether an agreement or understanding exists between the insurer and non-affiliate to the effect that any portion of the assets constituting the consideration for the agreement will be transferred to one or more of the insurer’s affiliates. Furnish a brief description of the consideration involved in the transaction, and a brief statement as to the effect of the transaction upon the insurer’s surplus.
Notice shall be given for all reinsurance pooling agreements including modifications thereto.
No notice need be given for reinsurance agreements or modifications thereto if the reinsurance premium or the projected reinsurance premium or change in the insurer’s liabilities in any of the next three years, in connection with the reinsurance agreement or modification thereto is less than 5% of the insurer’s surplus as regards policyholders, as of the 31st day of December next preceding.
Item 6. Management Agreements, Service Contracts, Tax Allocation Agreements, Guarantees and Cost-Sharing Arrangements reported pursuant to 40 P. S. § 991.1405(a)(2)(v).
A. For management agreements and service contracts, furnish:
(1) A brief description of the managerial responsibilities, or services to be performed.
(2) A brief description of the agreement, including a statement of its duration, together with brief descriptions of the basis for compensation and the terms under which payment or compensation is to be made.
B. For cost-sharing arrangements, furnish:
(1) A brief description of the purpose of the agreement.
(2) A description of the period of time during which the agreement is to be in effect.
(3) A brief description of each party’s expenses or costs covered by the agreement.
(4) A brief description of the accounting basis to be used in calculating each party’s costs under the agreement.
(5) A brief statement as to the effect of the transaction upon the insurer’s policyholder surplus.
(6) A statement regarding the cost allocation methods that specifies whether proposed charges are based on ‘‘cost or market.’’ If market based, rationale for using market instead of cost, including justification for the company’s determination that amounts are fair and reasonable.
(7) A statement regarding compliance with the NAIC Accounting Practices and Procedure Manual regarding expense allocation.
C. For tax allocation agreements and guarantees, furnish:
(1) A brief description of the purpose of the agreement.
(2) A description of the period of time during which the agreement is to be in effect.
(3) A brief statement as to the effect of the transaction upon the insurer’s policyholder surplus.
(4) A statement regarding compliance with the NAIC Accounting Practices and Procedure Manual regarding expense allocation.
Item 7. Signature and Certification
Signature and certification required as follows:
SIGNATURE
Pursuant to the requirements of Section 1405 of the act,
has caused this notice to be duly signed on its behalf in the City of
and State of
on the
day of
,
.(SEAL)
Name of Applicant
By (Name) (Title)
Attest:
(Signature of Officer)
(Title)
CERTIFICATION The undersigned deposes and says that (s)he has duly executed the attached notice dated
,
, for and on behalf of
;
(Name of Applicant)
that (s)he is the
of such company and that (s)he is authorized
(Title of Officer)
to execute and file such instrument. Deponent further says that (s)he is familiar with such instrument and the contents thereof, and that the facts therein set forth are true to the best of his/her knowledge, information and belief.(Signature)
(Type or print name beneath)
FORM E
PRE-ACQUISITION NOTIFICATION STATEMENT OF THE POTENTIAL COMPETITIVE IMPACT OF A PROPOSED MERGER OR ACQUISITION
(Name of Insurer)
BY: (Name of Acquiring Persons)
Filed with the Insurance Department of the Commonwealth of Pennsylvania
Date:
Name, title, address and telephone number of person completing this statement:
Item 1. Name and Address
State the names and addresses of acquiring persons.
Item 2. Name and Addresses of Affiliated Persons
State the names and addresses of the persons affiliated with those listed in Item 1. Describe their affiliations.
Item 3. Nature and Purpose of Proposed Merger or Acquisition
State the nature and purpose of the proposed merger or acquisition.
Item 4. Nature of Business
State the nature of the business performed by each of the persons identified in response to Item 1 and Item 2.
Item 5. Market and Market Share
State specifically what market and market share the persons identified in Item 1 and Item 2 currently enjoy in this Commonwealth in each insurance market which, under section 1403(b)(2)(v) of the act (40 P. S. § 1403(b)(2)(v)), causes the proposed merger or acquisition not to be exempted from Article XIV of the act. Provide historical market and market share data for each person identified in Item 1 and Item 2 for the past 5 years, or for the number of years the person and any predecessors thereof have been transacting business if less than 5 years, and identify the source of the data. Provide a determination as to whether the proposed acquisition or merger, if consummated would violate the competitive standards as stated in Section 1403 of the Act (40 P. S. § 991.1403(d)(1)). If the proposed acquisition or merger would violate competitive standards, provide justification of why the acquisition or merger would not substantially lessen competition or create a monopoly in the Commonwealth.
For purposes of this item, market means direct written insurance premium in this Commonwealth for a line of business as contained in the annual statement required to be filed by insurers licensed to do business in this Commonwealth.
Item 6. Signature and Certification
Signature and certification required as follows:
SIGNATURE
Pursuant to the requirements of Section 1402 of the act
has caused this application to be duly signed on its behalf in the City of
and State of
on the
day of
,
.(SEAL)
Name of Applicant
BY (Name) (Title)
Attest:
(Signature of Officer)
(Title)
CERTIFICATION The undersigned deposes and says that (s)he has duly executed the attached application dated
,
, for and on behalf of
; (Name of Applicant)
that (s)he is the
of such company and that (s)he is authorized
(Title of Officer)
to execute and file such instrument. Deponent further says that (s)he is familiar with such instrument and the contents thereof, and that the facts therein set forth are true to the best of his/her knowledge, information and belief.(Signature)
(Type or print name beneath)
FORM F
ENTERPRISE RISK REPORT
Filed with the Insurance Department of
By
Name of Registrant/Applicant
On Behalf of/Related to Following Insurance Companies
Name Address
Date:
, 20
Name, Title, Address and telephone number of Individual to Whom Notices and Correspondence Concerning This Statement Should Be Addressed:
Item 1. Enterprise Risk
The Registrant/Applicant, to the best of its knowledge and belief, shall provide information regarding the following areas that could produce enterprise risk as defined in section 1401 of the act (40 P. S. § 991.1401) provided such information is not disclosed in the Insurance Holding Company System Annual Registration Statement filed on behalf of itself or another insurer for which it is the ultimate controlling person:
A. Any material developments regarding strategy, internal audit findings, compliance or risk management affecting the insurance holding company system.
B. Acquisition or disposal of insurance entities and reallocating of existing financial or insurance entities within the insurance holding company system.
C. Any changes of shareholders of the insurance holding company system exceeding ten percent (10%) or more of voting securities.
D. Developments in various investigations, regulatory activities or litigation that may have a significant bearing or impact on the insurance holding company system.
E. Business plan of the insurance holding company system and summarized strategies for next 12 months.
F. Identification of material concerns of the insurance holding company system raised by a supervisory college, if any, in last year.
G. Identification of insurance holding company system capital resources and material distribution patterns.
H. Identification of any negative movement, or discussions with rating agencies which may have caused, or may cause, potential negative movement in the credit ratings and individual insurer financial strength ratings assessment of the insurance holding company system (including both the rating score and outlook).
I. Information on corporate or parental guarantees throughout the holding company and the expected source of liquidity should such guarantees be called upon.
J. Identification of any material activity or development of the insurance holding company system that, in the opinion of senior management, could adversely affect the insurance holding company system.
The Registrant/Applicant may attach the appropriate form most recently filed with the U.S. Securities and Exchange Commission, provided the Registrant/Applicant includes specific references to those areas listed in Item 1 for which the form provides responsive information. If the Registrant/Applicant is not domiciled in the U.S., it may attach its most recent public audited financial statement filed in its country of domicile, provided the Registrant/Applicant includes specific references to those areas listed in Item 1 for which the financial statement provides responsive information.
Item 2: Obligation to Report
If the Registrant/Applicant has not disclosed any information pursuant to Item 1, the Registrant/Applicant shall include a statement affirming that, to the best of its knowledge and belief, it has not identified enterprise risk subject to disclosure pursuant to Item 1.
Item 3: Signature and Certification
SIGNATURE AND CERTIFICATION Signature and certification required as follows:
SIGNATURE
Pursuant to the requirements of Section 1404 of the act, the Registrant has caused this enterprise risk report to be duly signed on its behalf in the City of
and State of
on the
day of
,
.(SEAL)
Name of Registrant
By (Name) (Title)
Attest:
(Signature of Officer)
(Title)
CERTIFICATION The undersigned deposes and says that (s)he has duly executed the attached enterprise risk report dated
,
, for and on behalf of (Name of Company); that (s)he is the (Title of Officer) of such company and that (s)he is authorized to execute and file such instrument. Deponent further says that (s)he is familiar with such instrument and the contents thereof, and that the facts therein set forth are true to the best of his/her knowledge, information and belief.(Signature)
(Type or print name beneath)
Authority The provisions of this Appendix A issued under Article XIV of The Insurance Company Law of 1921 (40 P. S. § § 991.1401—991.1413); amended under section 337.8 and Article XIV of The Insurance Company Law of 1921 (40 P. S. § § 459.8 and 991.1401—991.1413); and sections 206, 506, 1501 and 1502 of The Administrative Code of 1929 (71 P. S. § § 66, 186, 411 and 412).
Source The provisions of this Appendix A adopted September 3, 1993, effective September 4, 1993, 23 Pa.B. 4216; amended August 10, 2001, effective August 11, 2001, 31 Pa.B. 4406; amended May 16, 2014, effective June 16, 2014, 44 Pa.B. 2851. Immediately preceding text appears at serial pages (281693) to (281709).
Cross References This appendix cited in 31 Pa. Code § 25.12 (relating to forms—general requirements); 31 Pa. Code § 25.13 (relating to forms—incorporation by reference, summaries and omissions); 31 Pa. Code § 25.15 (relating to forms—additional information and exhibits); 31 Pa. Code § 25.16 (relating to acquisition of control—statement filings); 31 Pa. Code § 25.17 (relating to annual registration of insurers—statement filing); 31 Pa. Code § 25.18 (relating to summary of registration—statement filing); 31 Pa. Code § 25.19 (relating to alternative and consolidated registrations); 31 Pa. Code § 25.21 (relating to transactions subject to prior notice—notice filing); 31 Pa. Code § 25.21a (relating to enterprise risk report); and 31 Pa. Code § 25.22 (relating to all dividends and other distributions).
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