Property & Casualty 2010 Compliance Conference

Using the “Filing Smart” Manual A Guide to Financial Program Filings and Property and Casualty Division – Data Services Filings for Insurers and Other Entities Doing Business in Texas John Peters Assistant Chief Analyst Financial Analysis Financial Program

Topics of Discussion Overview of Filing Smart Categories Premium Taxes, Maintenance Taxes, Filing Fees and Miscellaneous Assessments Using Filing Smart NAIC Checklists Actuarial Data Calls Issued by Property and Casualty Division – Data Services Holding Company Filings Company Licensing and Registration Questions

Overview of Filing Smart Originated in 1993 To assist insurers in submitting information to the Financial Program and Data Services Shows at a glance what, when, and where to file The amount of any applicable fee Who to call if there are questions Includes information about data call filings required by the Data Services Division Website:

Categories Categorized by Company Type Accredited and Trusteed Reinsurers Alien Surplus Lines Insurers Continuing Care Retirement Communities (CCRCs) Farm Mutuals Foreign Surplus Lines Insurers Fraternals Health Maintenance Organizations Life, Accident and Health Insurers Mexican Casualty Company Companies Multiple Employer Welfare Arrangements (MEWAS )

Categories continued Categorized by Company Type continued Mutuals: Local Mutual Burial, Local Mutual Aid, Statewide Mutual, and Exempt Companies Non-Profit Legal Services Corporations Premium Finance Companies Property/Casualty Insurers (including County Mutuals) Purchasing Groups Risk Retention Groups Stipulated Premium Companies Surplus Lines Insurers Title Insurers

Premium Taxes, Maintenance Taxes, Filing Fees and Miscellaneous Assessments Fees collected by the Financial Program are specified in the applicable section of the Guide Maintenance Taxes and various other taxes, fees and assessments are processed by the Texas Comptroller of Public Accounts -Insurers subject to these taxes, fees and assessments should contact the Comptroller with any questions. Comptroller’s website: or call (800) or (512)

Using Filing Smart Contains various useful information such as Department and NAIC mailing addresses and Department contact information Lists regular interval filings, separated into sections by each type of company Addresses the different TDI Financial Program filings relating to: Licensing Holding Company Transactions Actuarial Issues and Filings Data Calls Includes: Glossary of Terms Index to Statutory Citations

NAIC Checklists Required State Filings for Fraternals, Health Entities, Life, Accident and Health Insurers, Property and Casualty Insurers, and Title Companies NAIC Financial Statements NAIC Supplements Electronic Filing Requirements Audited Financial Statements State Required Filings

Actuarial The Actuarial Division is responsible for solvency analysis functions which include the review and examination of reserves for both life and property and casualty companies along with the review and examination of other related actuarial items. The Actuarial Division is also responsible for providing actuarial expertise in the review of matters ranging from reserve compliance to consumer policy value and equity issues. Information on efforts of the Division relating to either processing, issuance, filing review, or approvals are as follows: Actuarial Memorandums Actuarial Opinions Regulatory Asset Adequacy Issues Summary and Actuarial Opinion Summary Actuarial Opinion Exemptions – Property and Casualty Insurers

Actuarial continued Information on efforts of the division relating to either processing, issuance, filing review, or approvals continued Reserve Destrengthening Appointed Actuary Property and Casualty Insurers Reserve Valuation Reports (RVRS) Certificates of Valuation Approval Requests Relating To TAC §§ –

Data Calls Issued by Property & Casualty Division-Data Services Data Services collects and maintains statistical data and produces statistical reports for the Legislature, the agency, the public, and the insurance industry. Data are obtained through scheduled data calls, special data calls, statistical plans, or are downloaded from the NAIC database. Data calls and resulting reports are posted on the TDI web site at Data Collection Activities, include: Annual Aggregate Report (previously known as Annual (Summary) Closed Claim Report Call for Quarterly Experience Call for Quarterly Experience, Workers’ Compensation Deductible Plans

Data Calls Issued by Property & Casualty Division-Data Services continued Data Collection Activities, continued Closed Claim Reconciliation Form Detailed Claim Information Disallowed Expense Call Quarterly Closed Claim Report Texas Workers’ Compensation Financial Call (TXWCFC) Title Insurance Agent Statistical Report Title Insurance Company Call for Experience Unit Statistical Call (Unit Stat)

Data Calls Issued by Property & Casualty Division -Data Services continued Published Reports Quarterly Legislative Report on Market Conditions Texas Liability Closed Claim Annual Report Texas Disallowed Expense Annual Report Texas Title Insurance Agent Statistical Report, and Texas Title Experience Report Texas Schedule Z Report Year-End Reports Job Classification Relativities State of Texas Property and Casualty Insurance Experience by Coverage and Carriers (Texas Statutory Page 14 Report) Insurance Expense Exhibit (IEE)

Data Calls Issued by Property & Casualty Division-Data Services continued Statistical Plans Texas Title Insurance Statistical Plan Texas Workers’ Compensation Statistical Plan Texas Detailed Claim Information Statistical Plan Texas Statistical Plan, refers collectively to: Texas Commercial Lines Statistical Plan Texas Private Passenger Automobile Statistical Plan Texas Residential Property Statistical Plan

Holding Company Filings Holding Company Filing Requirements Disclosure of Material Transactions, written notice if not otherwise provided Form B Initial Registration Statement Annual Registration Statement Completely Restated Registration Statement Special Monthly Amendments to Registration Statement

Holding Company Filings continued Holding Company Filing Requirements continued Form C Disclaimer of Control or Affiliation Insider Trading Reports (to be filed by officers, directors and 10% shareholders of a domestic insurer with 100 or more shareholders): Form 3, initial Statement of Beneficial Ownership of Securities Form 4, Statement of Changes in Beneficial Ownership of Securities Pledge of Assets Proxy Statement (Definitive), to be filed by a domestic insurer with 100 or more shareholders

Holding Company Filings continued Holding Company Filing Requirements continued Proxy Statement (Preliminary), to be filed by a domestic insurer with 100 or more shareholders Schedule SIS, Stockholder information Supplement (required of domestic insurers with 100 or more shareholders) Surplus Debentures, written notice before date of payment or repayment of subordinated indebtedness if schedule of payments not contained in the agreement or the payment or repayment does not comply with specific terms of the agreement (issued on or after September 1, 1995)

Holding Company Filings continued Affiliate Transactions Application of approval of transaction (written) – including agreements involving sales, purchases, exchanges, loans or extensions of credit or investments, involving the lesser of either : a) 5% of admitted assets, or b) 25% of surplus Approval of an exemption from filing of Form A (written application for) – to be filed by any entity proposing to acquire control of a domestic insurer or commercially domiciled insurer or a holding company controlling same which does not have the effect of changing or influencing control Approval of the investment funds (written application for) – in excess of those amounts authorized under applicable investment statutes along with copies of applicable agreements

Holding Company Filings continued Affiliate Transactions continued Approval of payment of principal or interest on money advanced (written application for) - Applies to County Mutuals and Reciprocals only Approval of transactions (written application for) - including agreements for the rendering of services or facilities on a regular or systematic basis; management service, cost sharing, rental or lease agreements, federal income tax return consolidation agreements; transactions with affiliated financial institutions; and, sales, purchases, exchanges, loans or extensions of credit or investments involving the lesser of either: a) more than ½ of 1% but less than 5% of admitted assets, or b) more than 5% but less than 25% of surplus; and transactions in the securities of an affiliate which is not a subsidiary of the insurer

Holding Company Filings continued Affiliate Transactions continued Form A, Statement Regarding the Acquisition of Control Form D, Notice of Declaration of Extraordinary Dividend

Company Licensing and Registration Company Licensing and Registration is now responsible for licensing HMOs, including: Application for Certificate of Authority to act as an HMO, as well as any amendments Service Area Expansions Changes to Organizational documents HMO Filing Requirements

Company Licensing and Registration continued HMO’s continued Changes of Officers and Directors Changes in Ownership Stop-loss Contracts Dividends Information required by Art. 20A.06(b)(1) affiliate agreements Any change in Affiliates Contracts with persons listed as officers and directors and management contracts

Company Licensing and Registration continued Non-Admitted Market Contains section on filings for: Surplus lines insurers Risk Retention and Purchasing Groups Accredited and Trusteed Reinsurers

Company Licensing and Registration continued Admitted Market Contains section on filings for: Applications for Incorporation Foreign/Alien Admissions Charter Amendments Changes in Status of Certificates of Authority Redomestications Filing of Disciplinary Actions

Company Licensing and Registration continued Admitted Market continued Appointment of Attorney for Service Mergers Assumptive Reinsurance Transactions Withdrawals Dissolutions Filing of By-Laws and Minutes Biographical Affidavits Matters relating to Statutory Deposits Joint Control Agreements Declarations of Trust

Questions? John Peters 512/ Kristine Ehrlich 512/ Filing Smart Website: