The bill amends the Washington State Insurance Holding Company Act by introducing new definitions and requirements aimed at enhancing the regulatory framework for insurance holding companies. Key insertions include definitions for "group capital calculation instructions," "scope criteria," and "national association of insurance commissioners liquidity stress test framework," which provide guidelines for evaluating the financial health of insurance groups. Additionally, it mandates that the ultimate controlling person of every insurer must file an annual group capital calculation with their registration, ensuring comprehensive monitoring of the financial stability of the entire holding company system. Certain exemptions from this requirement are also specified for specific types of insurance holding company systems.
Moreover, the bill clarifies the definition of "materiality" in registration statements, indicating that it does not pertain to the group capital calculation or liquidity stress test framework, thereby streamlining the reporting process for insurers. It also grants the lead state commissioner the authority to require group capital calculations from non-U.S. based insurance holding companies when necessary for oversight. The bill emphasizes the confidentiality of sensitive information related to these calculations and tests, designating such data as proprietary and trade secret, while outlining conditions for sharing this information with other regulatory bodies. Public dissemination of group capital calculations and liquidity stress test results is prohibited in a way that could mislead the public, reinforcing their intended use as tools for risk and capital adequacy evaluation.
Statutes affected: Original Bill: 48.31B.005, 48.31B.025, 48.31B.038
Bill as Passed Legislature: 48.31B.005, 48.31B.025, 48.31B.038
Session Law: 48.31B.005, 48.31B.025, 48.31B.038