Page 623

House Bill No. 5506

Public Act No. 22-118 623 of 739

agency captive insurance company to meet such agency captive insurance company's policy obligations. (2) (A) The [Insurance Commissioner] commissioner shall not issue a license to a branch captive insurance company or allow the branch captive insurance company to retain such license unless the branch captive insurance company has and maintains, as security for the payment of liabilities attributable to the branch operations: (i) Not less than [two hundred fifty thousand dollars;] the greater of: (I) Fifty thousand dollars; or (II) An amount that the commissioner determines is necessary to secure the payment of liabilities attributable to the branch captive insurance company's operations; and (ii) Reserves on such insurance policies or such reinsurance contracts as may be issued or assumed by the branch captive insurance company through its branch operations, including reserves for losses, allocated loss adjustment expenses, incurred but not reported losses and unearned premiums with regard to business written through the branch operations. The commissioner may permit a branch captive insurance company to credit against any such reserves any [security for loss reserves that the branch captive insurance company posts with a ceding insurer or is posted by a reinsurer with the branch captive insurance company, so long as such security remains posted] assets belonging to: (I) The branch captive insurance company that are held in trust for, or otherwise segregated or controlled by, a ceding insurer, that secure the branch captive insurance company's reinsurance obligations to the ceding insurer; or (II) A reinsurer that are held in trust for, or otherwise under the control of, the branch captive insurance company, that secure the