The bill amends the Code of West Virginia to enhance regulatory oversight of insurance companies within holding company systems. Key provisions include the requirement for these companies to annually file a group capital calculation and the results of a liquidity stress test that adheres to the National Association of Insurance Commissioners (NAIC) framework. The insurance commissioner is granted authority to mandate deposits or bonds for companies in precarious financial conditions and to ensure that records held by affiliates remain under the insurer's control. Additionally, the bill introduces definitions for terms such as "affiliate" and "control," and mandates that the ultimate controlling person of every insurer file an annual enterprise risk report identifying material risks within the holding company system.

Furthermore, the bill establishes standards for transactions within insurance holding company systems, emphasizing fair terms and introducing new requirements for insurers in hazardous financial conditions. It specifies that a minimum of one-third of the board of directors and committee members of a domestic insurer must be independent, and it updates confidentiality provisions regarding documents obtained during regulatory examinations. The bill also clarifies the conditions for extraordinary dividends and distributions, allowing insurers to carry forward net income from previous years. Overall, the legislation aims to bolster the financial stability and governance of insurance companies while ensuring compliance with regulatory standards.

Statutes affected:
Introduced Version: 33-27-2, 33-27-4, 33-27-5, 33-27-6a, 33-27-7, 33-27-8