SECTION 7.602. Definitions

The following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise.

(1) Assuming insurer--An insurer as defined in Insurance Code §493.001. The term includes an insurer that assumes:

(A) the insurance risk of loss of the ceding insurer under the ceding insurer's indemnity reinsurance agreement, or

(B) the policy obligations of the ceding insurer under an assumption reinsurance agreement.

(2) Assumption reinsurance--A reinsurance agreement under which the assuming insurer assumes in writing the direct policy obligations of the ceding insurer in substitution for the obligations of the ceding insurer.

(3) Ceding insurer--The insurer that transfers an insurance risk of loss or part of an insurance risk of loss to an assuming insurer pursuant to a reinsurance agreement.

(4) Commissioner--Texas Commissioner of Insurance.

(5) GAAP--United States Generally Accepted Accounting Principles.

(6) Indemnity reinsurance--A reinsurance agreement that transfers an insurance risk of loss between insurers for a consideration commensurate with the risk transferred and under which an assuming insurer indemnifies a ceding insurer against all or part of the insurance risk of loss that the ceding insurer may sustain under the insurance policy or policies that the ceding insurer has issued or assumed.

(7) Insurer--A person legally organized in and authorized by its domiciliary jurisdiction to do the business of insurance, including those types of entities listed in Insurance Code §493.002, a title insurer operating under Insurance Code Title 11, or a domestic surplus lines insurance company operating under Insurance Code Chapter 981.

(8) NAIC--National Association of Insurance Commissioners.

(9) Nationally recognized statistical rating organization (NRSRO)--A credit rating agency currently registered as such with the United States Securities and Exchange Commission to issue credit ratings for insurance companies.

(10) Person--An individual, corporation, partnership, or other legal entity.

(11) Qualified United States financial institution--Those institutions as defined in the Insurance Code §493.001.

(12) Reinsurance agreement--A written contract that transfers an insurance risk of loss between insurers for a consideration commensurate with the risk transferred.

(13) Surplus as regards policyholders--The excess of net admitted assets over the sum of total liabilities.

(14) TDI--Texas Department of Insurance.

Source Note: The provisions of this §7.602 adopted to be effective August 16, 1990, 15 TexReg 4435; amended to be effective June 19, 2018, 43 TexReg 3888