[Federal Register: December 26, 2002 (Volume 67, Number 248)]
[Notices]
[Page 78864-78869]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26de02-138]
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DEPARTMENT OF THE TREASURY
Departmental Offices; Interim Guidance Concerning Definition of
Insurers, Scope of Insurance Coverage, and Disclosures Mandated by the
Terrorism Risk Insurance Act of 2002
AGENCY: Department of the Treasury, Departmental Offices.
ACTION: Notice.
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SUMMARY: This notice provides additional interim guidance concerning
entities that are ``insurers'' as defined in Title I of the Terrorism
Risk Insurance Act of 2002 and, therefore, are required to be
participants in the Department of Treasury's Terrorism Risk Insurance
Program. This notice also provides interim guidance concerning the
scope of insurance coverage under the Program, including guidance to
assist participating insurers in estimating their ``insurer
deductible,'' prior to the issuance of regulations, based on how they
report their ``direct earned premium'' (or comparable format).
Additional guidance concerning required disclosures under the Act is
also provided by this notice.
DATES: This notice is effective immediately and will remain in effect
until superceded by regulations or by subsequent notice.
FOR FURTHER INFORMATION CONTACT: Mario Ugoletti, Deputy Director,
Office of Financial Institutions and GSE Policy 202-622-2730; Martha
Ellett, Attorney-Advisor, Office of the Assistant General Counsel
(Banking and Finance) 202-622-0480.
SUPPLEMENTARY INFORMATION: This notice provides additional interim
guidance to assist insurers in ascertaining whether they are covered
by, and how they may comply with, certain immediately applicable
provisions of Title I of the Terrorism Risk Insurance Act of 2002 (Pub.
L. 107-297) (the Act) prior to the issuance of regulations by the
Department of the Treasury (Treasury). The interim guidance contained
in this notice, along with interim guidance issued previously by
Treasury, may be relied upon by insurers in complying with these
statutory requirements and is intended to assist insurers prior to the
issuance of regulations on these issues. This interim guidance remains
in effect until superceded by regulations or subsequent notice.
I. Background
On November 26, 2002, the President signed into law the Terrorism
Risk Insurance Act of 2002. The Act became effective immediately. It
establishes a temporary federal program of shared public and private
compensation for insured commercial property and casualty losses
resulting from an ``act of terrorism,'' as defined in the Act. The
Terrorism Risk Insurance Program is administered and implemented by
Treasury and will sunset on December 31, 2005.
II. Interim Guidance
Treasury will be issuing regulations to administer and implement
certain elements of the Terrorism Risk Insurance Program (Program). To
assist insurers in complying with certain statutory requirements prior
to the issuance of regulations, Treasury issued initial interim
guidance at 67 FR 76206 (December 11, 2002) (also located on Treasury's
Terrorism Risk Insurance Program web site at http://www.treasury.gov/trip
). This notice contains additional interim guidance concerning
entities within the definition of ``insurer'' in section 102(6) of the
Act. This notice also provides interim guidance concerning the scope of
insurance coverage based on the definition of ``insured loss'' and
guidance to assist insurers in estimating their ``insurer deductible''
under the Program prior to the issuance of regulations by Treasury.
This notice also provides additional guidance concerning the Act's
disclosure requirements.
A. Insurer Participation in General
What Entities Must Participate in the Program?
Section 103(a)(3) of the Act requires that each entity that meets
the definition of insurer in section 102(6) of the Act shall
participate in the Program. Under the Act, among other requirements,
participation means that insurers must comply with the ``make
available'' requirements and the disclosure provisions in section 103,
as further described in Treasury's initial interim guidance at 67 FR
76206. In addition, participation in the Program means that an insurer
is subject to the policy surcharge (recoupment) provisions of the Act
on the insurer's property and casualty insurance policies as provided
in section 103(e)(8).
What Entities Are ``Insurers'' for Purposes of the Program?
Section 102(6) of the Act defines the term ``insurer'' for purposes
of the Program to mean, any entity, including an affiliate of that
entity, that meets the statutory requirements contained in section
102(6)(A),(B) and (C), as described below.
First, to be an insurer, an entity must fall within at least one of
the categories in section 102(6)(A):
(i) Licensed or admitted to engage in the business of providing
primary or excess insurance in any State (``State'' includes the
District of Columbia and territories of the United States);
(ii) Not so licensed or admitted, but is an eligible surplus line
carrier listed on the Quarterly Listing of Alien Insurers of the
National Association of Insurance Commissioners;
(iii) Approved for the purpose of offering property and casualty
insurance by a Federal agency in connection with maritime, energy or
aviation activity; or
(iv) A State residual market insurance entity or State workers'
compensation fund.
The definition of ``insurer'' in section 102(6)(A)(v) also includes
captive and self-insurance arrangements, not otherwise covered in
clauses (i)-(iv) above, to the extent provided in rules issued by
Treasury under this section 103(f) (emphasis supplied). Treasury has
not issued such rules.
In addition to coming within a category in section 102(6)(A), to be
an ``insurer'' under the Act, an entity must receive ``direct earned
premiums'' on any type of commercial ``property and casualty
insurance.'' (Section 102(6)(B) excepts state residual market insurance
entities and captives and self-insurance arrangements that do not fall
into the categories listed in section 102(6)(A)(i),(ii) or (iii) from
this direct earned premium requirement.)
Third, the entity must meet ``any other criteria that the Secretary
of the Treasury may reasonably prescribe'' under section 102(6)(C).
May an Affiliate of an Insurer Participate in the Program if the
Affiliate Itself Does Not Meet the Requirements for an Insurer in
Section 102(6)(A) and (B)?
No. To participate in the Program, an entity, including an
affiliate of an insurer, must itself meet all of the requirements of
section 102(6)(A)and (B) as well any requirements that may be
prescribed under section 102(6)(C).
If a Parent Company Meets the Requirements of section 102(6)(A) and
(B), But Not All of the Parent Company's Affiliates Meet the
Requirements for an Insurer Under Section 102(6)(A) and (B), How Will
These Entities be Treated Purposes of the Program?
Treasury intends to consider the parent company, and all affiliates
that meet the requirements of ``insurer'' in
[[Page 78865]]
section 102(6)(A) and (B) (and, if issued (C)), to be, collectively one
``insurer'' for purposes of the Program. Any affiliate that does not
meet these statutory requirements is not an insurer under the Act, and
therefore is not a participant in the Program. For example, if an
insurance company is licensed or admitted to engage in the business of
providing primary or excess insurance in a State and receives direct
earned premiums as required in section 102(6)(B), and three out of four
of its affiliate insurance companies also are State licensed and meet
the requirements of section 102(6)(B), then the parent company and the
three affiliates that meet the requirements of section 102(6)(A) and
(B) are collectively, one insurer for purposes of the Program. The
affiliate that does not fall within one of the categories in section
102(6)(A) or fails to meet all the requirements to be an ``insurer''
under section 102(6) is not included in the Program.
If an Entity Meets the Definition of Insurer But Its Parent Company
Does Not, Is the Entity an Insurer for Purposes of the Act?
Yes. Any entity that meets the requirements of section 102(A) and
(B) (and, if issued, (C)), is an ``insurer'' under the Act, and
therefore is required to participate in the Program under section
103(a)(3) of the Act. If an entity is ``under common control with the
insurer,'' and that entity meets the requirements of section 102(A) and
(B) (and if issued (C)) Treasury intends to consider that entity
collectively with the other insurer (its affiliate) as one ``insurer''
for purposes of the Program. For example, assume that two insurance
companies are licensed to engage in the business of providing primary
or excess insurance in any State (either in one State or in separate
States) and both receive direct earned premiums as required by section
102(6)(B). Each company, therefore, meets the definition of
``insurer,'' but assume that the common parent of the two companies
does not fall into any of the categories in section 102(6)(A). Treasury
intends to consider the two affiliated companies to be, collectively,
one insurer for purposes of the Program, but their parent company is
not an insurer and not included in the Program.
If an Entity Falls Within More Than One Category in Section 102(6)(A),
How is it Treated for Purposes of the Program?
An entity that falls within two categories will be considered as
falling within the first category it meets under section 102(6)(A)(i)-
(v), as described in further detail below in part C of this interim
guidance.
Is Reinsurance Included in the Program?
No. Although the legislative history and design of the Act envision
reinsurance arrangements as an important component of capacity within
the insurance market, the Act excludes reinsurance from the federal
loss sharing Program. Section 103(g) of the Act expressly provides that
the Act does not limit or prevent ``insurers'' from obtaining
reinsurance coverage for ``insurer deductibles'' or ``insured losses''
retained by insurers. For the purposes of this interim guidance, if an
entity does not receive direct earned premiums as required by section
102(6)(B), then the entity is not an ``insurer'' under the Act.
B. Scope of Coverage in General
What Is an Insured Loss Under the Program?
The Act defines the term ``insured loss'' for purposes of the
Program in section 102(5). An insured loss means any loss resulting
from a certified ``act of terrorism'' covered by primary or excess
``property and casualty insurance,'' that is issued by an ``insurer,''
if such loss:
[sbull] ``Occurs within the United States'' or
[sbull] occurs to an ``air carrier''; a U.S. flag vessel or a
vessel ``based principally in the United States on which United States
income tax is paid and whose insurance coverage is subject to
regulation in the United States, regardless of where the loss occurs'',
or
[sbull] occurs ``at the premises of any United States mission.''
The Act defines ``United States'' in section 102(15) as the several
``States'' (defined in section 102(14) and including the District of
Columbia), as well as the territorial sea and the continental shelf of
the United States, as those terms are defined in the Violent Crime
Control and Law Enforcement Act of 1994 (18 U.S.C. 2280, 2281).
What Insurance Coverage Is Within the Scope of ``Insured Loss''?
In general, if the property and casualty insurance coverage is
provided within the geographic and other statutory parameters of the
definition of ``insured loss'' in the Act as described above, and is
provided by an ``insurer'' as defined in section 102(6) of the Act
(whether or not the insurer is foreign based or owned), then such
losses will be covered by the Program, subject to the conditions for
payment and other requirements of the Act. However, if insurance
coverage is provided by an entity that is not an ``insurer'' under the
Act, then, even if a loss occurs within the United States, or otherwise
meets the definitional parameters of ``insured loss,'' e.g. occurs to
an air carrier or vessel or mission as defined in the Act, the loss
would not be covered by the Program. In addition, if insurance is
provided by a U.S. insurer but the loss does not fall within the
definition of ``insured loss'' e.g. occurs on foreign soil and not to a
U.S. mission or covered air carrier or vessel, then the loss would not
be covered by the Program.
C. Categories of Insurers Under Section 102(6)(A)
1. State Licensed or Admitted
Which State Licensed or Admitted Insurance Companies Are Required to
Participate in the Program?
For purposes of this interim guidance, this category includes any
insurer that
[sbull] Is licensed or admitted in any State as defined in the Act,
[sbull] And that provides direct property and casualty insurance
coverage as defined in the Act and provided in Treasury's previous
interim guidance at 67 FR 76206 (December 11, 2002),
[sbull] And that reports its direct earned premiums as described in
Treasury's previous interim guidance (cited above), or that reports
comparable direct earned premium information to any State, e.g. county
mutual insurance companies.
What Insurance Coverage Provided by State Licensed and Admitted
Insurers Is Under the Program?
Treasury has issued interim guidance concerning lines of insurance
coverage included in the Program and ``direct earned premiums'' at 67
FR 76206 (December 12, 2002). The direct earned premium income for the
lines of coverage included in the Program described in that guidance
(direct premiums earned as reported to the NAIC in the Annual Statement
in column 2 of the Exhibit of Premiums and Losses--commonly known as
Statutory Page 14) primarily covers premiums and associated policies
for property and casualty insurance risks in the United States. Thus,
this direct earned premium information is generally consistent with
scope of ``insured loss'' as defined in the Act. If a State licensed or
admitted insurer within this category provides insurance coverage that
is not reported in the premium information submitted on Statutory Page
14, (or does not report comparable premium information to its licensing
or admitting State, e.g. as a county mutual insurance company) then
[[Page 78866]]
such insurance coverage will not be considered within the scope of the
Program prior to the issuance of regulations. Insurers and other
interested parties will have the opportunity to submit formal comments
to Treasury on lines of commercial property and casualty insurance
coverage that were specified in Treasury's initial interim guidance.
How May a State Licensed and Admitted Insurer Estimate Its Insurer
Deductible for Purposes of the Program?
The Act defines an ``Insurer Deductible'' in Section 102(7) for the
various ``Program Years'' and other periods covered by the Program. For
example, Section 102(7)(B) defines the insurer deductible for Program
Year 1 (January 1, 2003 through December 31, 2003) as ``the value of an
insurer's direct earned premiums over the calendar year immediately
preceding Program Year 1 multiplied by 7 percent.'' Prior to the
issuance of regulations, a State licensed or admitted insurer may
estimate its insurer deductible by multiplying the applicable
percentage (listed in the Act for the Transition Period and each of the
Program Years) by the direct earned premium information that the
insurer reports on Statutory Page 14, as described in Treasury's
previous interim guidance at 67 FR 76206 (or as comparably reported by
the insurer to its licensing or admitting State).
If an Entity Is State Licensed or Admitted Within Section 102(6)(A)(i)
and Also Is a Self-Insured or Captive Insurance Company (or Risk
Retention Group), How Is the Entity Treated For Purposes of the
Program?
Any entity that falls within the State ``licensed or admitted''
category 102(6)(A)(i), and receives and reports direct earned premiums
in accordance with section 102(6)(B) and Treasury's interim guidance at
67 FR 76206 (or reports comparable information to its licensing or
admitting State), will be considered by Treasury as an insurer under
section102(6)(A)(i), even if the entity is also in a self-insured or
captive arrangement. Such entities are required by section 103(a)(3) to
participate in the Program. In contrast, if a captive insurance company
or a risk retention group is licensed or admitted by a State, but does
not collect direct earned premiums as required by section 102(6)(B),
then such entities are not ``insurers'' under section 102(6)(A)(i).
These other entities may be addressed under subsequent Treasury
regulations, if issued for self-insured or captive entities under
section 103(f).
2. Eligible Alien Surplus Line Carriers
What Entities Are Covered by the Eligible Surplus Line Category?
Any eligible alien surplus line carrier listed on the NAIC
Quarterly Listing of Alien Insurers (Quarterly Listing) that receives
direct earned premiums as required in section 102(6)(B) is an insurer
and required to participate under the Program.
What Portion of Insurance Coverage Provided by Eligible Surplus Line
Carriers Is Required to Come Under the Terrorism Risk Insurance
Program?
The scope of insurance coverage provided by eligible surplus line
carriers covered by the Program for policies that are in-force as of
the date of enactment or that are entered into prior to January 1,
2003, may be determined by a surplus line carrier with reference to the
geographic scope in the definition of ``insured loss,'' and with
reference to the covered property and casualty lines of insurance
described in Treasury's previous interim guidance at 67 FR 76206, and
with reference to premium information collected using a format
consistent with Treasury's interim guidance for those entities that
report to the NAIC (i.e. direct earned premium information reported on
Statutory Page 14).
Treasury is coordinating with the NAIC and will be issuing
regulations governing the scope of insurance coverage provided by
eligible surplus line carriers under the Program for policies issued by
them and entered into after January 1, 2003. For purposes of interim
guidance, Treasury expects to propose that insurance coverage is within
the Program if (i) provided for losses within the geographic scope of
the definition of ``insured loss'' and (ii) within the lines of the
property and casualty insurance described in Treasury's interim
guidance at 67 FR 76206 and (iii) the premium income is calculated
using a format consistent with the format referred to in that interim
guidance (i.e. Statutory Page 14). Treasury also expects to propose
that the premium for insurance coverage within the geographic scope of
``insured loss'' must be priced separately by eligible surplus line
insurers for policies issued after January 1, 2003.
How May Eligible Surplus Line Carriers Calculate Their Insurer
Deductibles?
For purposes of this interim guidance, in calculating an ``Insurer
Deductible'' as defined in Section 102(7), eligible surplus line
carriers may use the premium base that corresponds to the coverage
requirements described in the previous question. In calculating the
deductible for Program Year 1, prior to the issuance of regulations,
eligible surplus line carriers may use and rely on the same allocation
methodologies contained within the NAIC's ``Allocation of Surplus Lines
and Independently Procured Insurance Premium Tax on Multi-State Risks
Model Regulation'' for allocating premium between coverage within the
geographic scope of ``insured loss'' and all other coverage to estimate
the appropriate percentage of premium income for such policies that
applies to such risks. A similar procedure may be relied upon to
calculate an eligible surplus line carrier's deductible for the
Transition Period.
3. Insurers Approved by Federal Agencies
Which Federally Approved Insurers Are Required to Participate in the
Terrorism Risk Insurance Program?
If an entity does not fall within section 102(6)(A)(i) or (ii), but
is approved by a Federal agency to offer property and casualty
insurance in connection with maritime, energy or aviation activities
and the entity receives direct earned premiums for any type of property
and casualty insurance, then, for purposes of this interim guidance,
such entity is considered by Treasury to be an ``insurer'' under
section 102(6)(A)(iii). This category of federally approved insurers
under section 102(6)(A)(iii) will be administered in a manner that is
consistent with any other reasonable criteria that may be prescribed at
a later date by Treasury pursuant to section 102(6)(C).
Examples of insurers under section 102(6)(A)(iii) are those
insurers that do not fall within section 102 (6)(A)(i) or (ii) and are
approved or accepted by a Federal agency under the following programs
and/or statutes:
[sbull] Approval of Underwriters for Marine Hull Insurance
(Maritime Administration, U.S. Department of Transportation)
[sbull] Aircraft Accident Liability Insurance (U.S. Department of
Transportation)
[sbull] Oil Spill Financial Responsibility for Offshore Facilities
(Minerals Management Service, U.S. Department of the Interior
[sbull] Oil Spill Financial Responsibility for Vessels (United
States Coast Guard, U.S. Department of Transportation)
[sbull] Longshoremen's and Harbor Workers' Compensation Act
(Employment Standards Administration, U.S. Department of Labor)
[[Page 78867]]
The above list of Federal insurance programs is not exclusive. Any
entity that is approved by a U.S. agency to offer property and casualty
insurance in connection with maritime, energy or aviation activities by
a program that is not listed above is encouraged to notify the
designated Treasury contacts in this notice prior to the issuance of
Treasury regulations or to submit a comment once regulations are
proposed.
Treasury intends to propose regulations providing that scope of
insurance coverage under the Program for insurers that are within
section 102(6)(A)(iii) is only the insurance coverage approved by the
Federal Agency.
How May Insurers Approved by a Federal Agency Calculate Their
Deductibles?
In estimating an ``Insurer Deductible'' as defined in Section
102(7), federally approved insurers may use the premium base that
corresponds to the coverage approved by the Federal agency. In
addition, Treasury expects to propose regulations that treat federally
approved insurers in a manner consistent with eligible alien surplus
line carriers as described above in the second question under Section
C.2.
For the purposes of this interim guidance, because insurers
approved by a Federal agency share many of the same characteristics as
eligible surplus line carriers on the NAIC's Quarterly Listing of Alien
Insurers, this class of insurers may estimate their insured deductible
under the Program in a similar manner as described for eligible surplus
line carriers. In calculating the deductible for Program Year 1, prior
to the issuance of regulations, and because insurance policies issued
by federally approved insurers may not have specifically allocated the
percentage of premium income that is attributable to risks within the
geographic scope of the definition of ``insured loss,'' federally
approved insurers may use the same allocation methodologies that are
contained within the NAIC's ``Allocation of Surplus Lines and
Independently Procured Insurance Premium Tax on Multi-State Risks Model
Regulation'' for allocating premiums between coverage within the
geographic scope of ``insured loss'' and all other coverage, to
estimate the appropriate percentage of premium income for such policies
that applies to such risks. A similar procedure may be relied upon to
calculate a federally approved insurer's deductible for the Transition
Period.
4. State Residual Insurance Market and Workers Compensation Funds
Which State Residual Insurance Market Entities or State Workers'
Compensation Funds Are Required to Participate in the Program?
These entities fall within section 102(6)(A)(iv) of the definition
of insurer and are required to participate in the Program. For the
purposes of this interim guidance, the Treasury, in consultation with
the NAIC, has identified a group of entities that fall within this
class of insurers (see attached list at the end of this interim
guidance). Any state residual insurance market entity or state workers'
compensation fund that is not on this list is encouraged to notify
Treasury through the designated contacts in this interim guidance.
How Do the Provisions of the Act Apply to State Residual Market
Insurance Entities or State Workers Compensation Funds?
Section 102(6)(A)(iv) provides a category for State residual market
insurance entities and State workers' compensation funds within the
definition of insurer. Section 102(6)(B) provides an exception for such
insurers from the requirement that they receive direct earned premiums,
but section 103(d) requires Treasury to issue regulations as soon as
practicable to apply the provisions of the Act to these types of
entities. Treasury is working with the NAIC on a methodology to address
a data reporting anomaly that arises when insurers act as servicing
carriers for residual market mechanisms. For purposes of interim
guidance, insurers within this category that have insufficient
information to issue disclosures under section 103(b)(2) are being
given a waiver from these disclosure requirements until Treasury issues
regulations governing how such requirements can and should be applied
to State Residual Market Entities and State Workers Compensation Funds
to fulfill the purposes of the Act. Treasury is giving priority
consideration to the development and issuance of proposed rules
applying provisions of the Act to State residual market insurance
entities and State workers compensation funds, as required by section
103(d).
5. Newly Formed Insurers
How Does an Insurer Determine Its Insured Deductible if It Was Not in
Business for the Full Calendar Year Prior to the Program Year?
Section 102(7) of the Act defines an ``insurer deductible.'' In
general, this is the value of a participating insurer's ``direct earned
premium'' over the calendar year immediately preceding the Program Year
(as defined). Section 102(7)(E) provides Treasury with authority to
determine the appropriate methodology for measuring the direct earned
premium if an insurer has not had a full year of operations during the
calendar year immediately preceding the Program Year.
Because new companies have only had limited business operations, it
is likely that their premium income will be somewhat volatile. Such
volatility could persist throughout the life of the three-year Program.
Thus, to administer these newly formed insurers in a manner that is
consistent with other insurers under the Program and to prevent newly
formed insurers from having the unfair advantage of lower relative
deductibles, Treasury intends to propose that the deductible measure
for new companies formed after the date of enactment (November 26) will
be based on contemporaneous data for direct earned premium that
corresponds to the current Program Year. If a newly formed insurer does
not have a full year of operations within a particular Program year,
Treasury intends to propose that insurer's direct earned premium for
Program year will be annualized to determine an insurer's deductible.
D. Additional Disclosure Guidance
If an Insurer Chooses To Use the NAIC's Model Disclosure Forms To
Satisfy the Disclosure Requirements of Section 103, Does the Insurer
Have To Follow the Model Disclosure Form Exactly?
No. As described in previous interim guidance, the NAIC disclosure
forms are ``model'' forms. Treasury's previous interim guidance
provides a safe harbor to insurers that use such model forms for the
purposes described in that guidance, but that guidance states that this
is not the exclusive means of complying with the disclosure provisions.
The NAIC's model disclosure forms reflect key information regarding
the Terrorism Risk Insurance Program that is required to be disclosed
to policyholders as a condition for federal payment under the Program,
such as Federal participation in the Program and any premium that is
being charged by the insurer for ``insured losses.'' However, insurers
may decide to modify such model forms to fit individual circumstances.
For example, if an insurer is providing disclosures under Section
103(b) and there is no change in the premium, the signature line on the
model form may be unnecessary. In
[[Page 78868]]
addition, in complying with the disclosure requirements, an insurer may
communicate the price to a policyholder in a manner that is consistent
with standard business practice, which, in some cases, may be as
percentage of overall policy premium.
Treasury intends to propose regulations that will indicate that
compliance with the disclosure provisions may be evidenced by an
insurer in a variety of ways, including but not limited to, a proof of
mailing process, certificates of mailing, returned forms signed by the
policyholders, and other methods consistent with the normal forms of
communication with policyholders that demonstrate that the disclosures
have been provided.
If Two or More Insurers Participate In Insuring a Single Commercial
Risk Through a Joint Underwriting or Risk Sharing Plan, Would Policies
Written Under Such Plans Be Under the Program?
Yes, if the insurers meet the definition of insurer and the joint
underwriting or risk sharing plans are authorized by the laws of the
state where the risk is located and where the policy or policies are
issued or delivered. To satisfy the ``make available'' requirement the
policy or policies should make available to the insured, coverage for
``insured losses'' that does not differ materially from the terms,
amounts and other coverage limitations applicable to losses arising
from events other than acts of terrorism.
Are the Property and Casualty Lines of Coverage Described in Treasury's
Initial Interim Guidance the Only Lines Covered Under the Program?
Until Treasury proposes and issues regulations concerning the
definition of property and casualty insurance for purposes of the
Program, insurers should refer to the definition contained within the
Act and the guidance provided in Treasury's previous interim guidance.
As part of the rulemaking process, interested parties will have a
chance to provide comments on Treasury's proposed regulation on this
definition.
Are All Types of Insurance Coverage Reported Under the Lines of
Coverage Listed Described in Treasury's Initial Interim Guidance
Covered Under the Program?
Until Treasury proposes and issues regulations concerning the
definition of property and casualty insurance for purposes of the
Program, insurers should refer to the definition contained within the
Act and the guidance provided in Treasury's previous interim guidance.
As part of the rulemaking process, interested parties will have a
chance to provide comments on Treasury's proposed regulation on this
definition.
Dated: December 18, 2002.
Wayne A. Abernathy,
Assistant Secretary of the Treasury.
Attachment--List of State Residual Market Mechanisms
----------------------------------------------------------------------------------------------------------------
Workers'
State Automobile Liability Property compensation
----------------------------------------------------------------------------------------------------------------
Alabama......................... Assigned Risk Plan .................. .................. NCCI.
Alaska.......................... Assigned Risk Plan .................. .................. NCCI.
American Samoa.................. None..............
Arizona......................... Assigned Risk Plan JUA--Liability.... .................. NCCI.
Arkansas........................ Assigned Risk Plan .................. .................. NCCI-Ark. Service
Center.
California...................... Assigned Risk Plan .................. Syndicate......... State Compensation
Insurance Fund.
Colorado........................ Assigned Risk Plan JUA--Commercial .................. Colorado
Lines. Compensation
Insurance
Authority.
Connecticut..................... Assigned Risk Plan .................. Syndicate......... NCCI.
Delaware........................ Assigned Risk Plan JUA--Property..... Syndicate......... Delaware
Compensation
Rating Bureau.
District of Columbia............ D.C. Auto .................. Syndicate......... NCCI.
Insurance Plan.
Florida......................... Joint Underwriting JUA--Unavailable Multiple Servicing Florida W.C. JUA.
Assoc. Lines. Carrier.
Georgia......................... Assigned Risk Plan JUA--Casualty..... Syndicate......... NCCI.
Guam............................ None..............
Hawaii.......................... Assigned Risk Plan .................. Single Servicing Hawaii Employers
Carrier. Mutual Insurance
Company.
Idaho........................... Assigned Risk Plan .................. .................. NCCI.
Illinois........................ Assigned Risk Plan .................. Syndicate......... NCCI.
Indiana......................... Assigned Risk Plan .................. Multiple Servicing Indiana
Car. Compensation
Rating Bureau.
Iowa............................ Assigned Risk Plan JUA--All P/C...... Syndicate......... NCCI.
Kansas.......................... Assigned Risk Plan JUA--Liability.... Single Servicing NCCI.
Carrier.
Kentucky........................ Insurance Plan.... .................. Syndicate......... Kentucky
Employers' Mutual
Insurance Co.
Louisiana....................... Assigned Risk Plan .................. Single Servicing Louisiana Workers'
Carrier. Compensation
Corp.
Maine........................... Assigned Risk Plan .................. .................. Maine Employers
Mutual Insurance
Company.
Maryland........................ State Fund........ .................. Syndicate......... Injured Workers'
Insurance Fund.
Massachusetts................... Assigned Risk Plan .................. Syndicate......... WCRIB of
& Reinsurance Massachusetts.
Facility.
Michigan........................ Placement Facility .................. Syndicate......... Michigan Workers'
Comp. Placement
Facility.
Minnesota....................... Assigned Risk Plan JUA--Liability, Syndicate......... Minnesota Workers'
except Product Comp. Insurers'
Liability. Assoc.
Mississippi..................... Assigned Risk Plan .................. .................. NCCI.
Missouri........................ Joint Underwriting .................. Syndicate......... Travelers
Assoc.. Insurance Co.
Montana......................... Assigned Risk Plan .................. .................. State Compensation
Insurance Fund.
[[Page 78869]]
Nebraska........................ Assigned Risk Plan .................. .................. Travelers
Insurance Co.
Nevada.......................... Assigned Risk Plan JUA--All Lines.... .................. NCCI.
New Hampshire................... Insurance Plan & JUA--Liability.... .................. NCCI.
Reinsurance
Facility.
New Jersey...................... Assigned Risk Plan .................. Syndicate......... Compensation
Rating and
Inspection
Bureau.
New Mexico...................... Assigned Risk Plan JUA--Essential Single Servicing NCCI-NM Service
Property. Carrier. Center.
New York........................ Assigned Risk Plan .................. Syndicate......... NY State Insurance
Fund.
North Carolina.................. Reinsurance JUA--Essential .................. NC Rate Bureau.
Facility. Property.
North Dakota.................... Assigned Risk Plan .................. .................. ND Workmen's
Compensation
Bureau.
Ohio............................ Assigned Risk Plan JUA--Classes of Syndicate......... Ohio Bureau of
Commercial Lines Workers'
Designated by the Compensation.
Commissioner.
Oklahoma........................ Assigned Risk Plan JUA--Liability.... .................. OK State Insurance
Fund.
Oregon.......................... Assigned Risk Plan JUA--Liability.... Single Servicing NCCI.
Carrier.
Pennsylvania.................... Assigned Risk Plan .................. Syndicate......... State Workmen's
Insurance Fund.
Puerto Rico..................... Assigned Risk Plan .................. .................. State Insurance
Fund Corporation
of Puerto Rico.
Rhode Island.................... Assigned Risk Plan .................. Syndicate......... Beacon Mutual Ins.
Co.
South Carolina.................. JUA \1\/Assigned JUA--Prof. .................. NCCI.
Risk Plan. Liability and
Liability for
Daycare Providers.
South Dakota.................... Assigned Risk Plan .................. .................. NCCI.
Tennessee....................... Assigned Risk Plan JUA--Unavailable .................. Aon Risk Services.
Lines.
Texas........................... Assigned Risk Plan JUA--Non-Profits.. .................. Texas Workers'
Comp. Insurance
Fund.
Utah............................ Assigned Risk Plan JUA--Unavailable .................. Workers'
Lines. Compensation Fund
of Utah.
Vermont......................... Assigned Risk Plan JUA--Unavailable .................. NCCI.
Lines, except
Pollution.
Virgin Islands.................. None..............
Virginia........................ Assigned Risk Plan JUA--Commercial Syndicate......... NCCI.
Line.
Washington...................... Assigned Risk Plan JUA--Daycare...... Single Servicing Washington
Carrier. Department of
Labor & Industry.
West Virginia................... Assigned Risk Plan JUA--Fire & EC.... Syndicate......... West Virginia
Workmen's
Compensation
Fund.
Wisconsin....................... Assigned Risk Plan JUA--Liability.... Syndicate......... Wisconsin
Compensation
Rating Bureau.
Wyoming......................... Assigned Risk Plan .................. .................. Wyoming Workers
Safety and
Compensation.
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\1\ South Carolina operates a JUA until Feb. 28, 2002 and will convert to an assigned risk plan thereafter.
[FR Doc. 02-32468 Filed 12-24-02; 8:45 am]
BILLING CODE 4810-25-P