Current through Supplement No. 394, October, 2024
Section 45-03-26-05 - Definitions1. "Actuarial method" means the methodology used to determine the required level of primary security, as described in section 45-03-26-06.2. "Covered policies" means subject to the exemptions described in section 45-03-26-04, covered policies are those policies, other than grandfathered policies, of the following policy types: a. Life insurance policies with guaranteed nonlevel gross premiums or guaranteed nonlevel benefits, or both, except for flexible premium universal life insurance policies; orb. Flexible premium universal life insurance policies with provisions resulting in the ability of a policyholder to keep a policy in force over a secondary guarantee period.3. "Grandfathered policies" means policies of the types described in subsection 2 that were: a. Issued prior to January 1, 2015; andb. Ceded, as of December 31, 2014, as part of a reinsurance treaty that would not have met one of the exemptions set forth in section 45-03-26-04 had that section then been in effect.4. "Noncovered policies" means any policy that does not meet the definition of covered policies, including grandfathered policies.5. "Required level of primary security" means the dollar amount determined by applying the actuarial method to the risks ceded with respect to covered policies, but not more than the total reserve ceded.6. "Primary security" means the following forms of security:a. Cash meeting the requirements of subsection 1 of North Dakota Century Code section 26.1-31.2-02.b. Securities listed by the securities valuation office of the national association of insurance commissioners meeting the requirements of subsection 2 North Dakota Century Code section 26.1-31.2-02 but excluding any synthetic letter of credit, contingent note, credit-linked note, or other similar security that operates in a manner similar to a letter of credit, and excluding any securities issued by the ceding insurer or any of its affiliates; andc. For security held in connection with funds-withheld and modified coinsurance reinsurance treaties: (1) Commercial loans in good standing of CM3 quality and higher;(3) Derivatives acquired in the normal course and used to support and hedge liabilities pertaining to the actual risks in the policies ceded pursuant to the reinsurance treaty.7. "Other security" means any security acceptable to the commissioner other than security meeting the definition of primary security.8. "Valuation manual" means the valuation manual adopted by the national association of insurance commissioners as described in subdivision a of subsection 1 of North Dakota Century Code section 26.1-35-00.2, with all amendments adopted by the national association of insurance commissioners that are effective for the financial statement date on which credit for reinsurance is claimed.9 "VM-20" means requirements for principle-based reserves for life products, including all relevant definitions, from the Valuation Manual.N.D. Admin Code 45-03-26-05
Adopted by Administrative Rules Supplement 2022-384, April 2022, effective 4/1/2022.General Authority: NDCC 26.1-31.2-04
Law Implemented: NDCC 26.1-31.2