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RECIPROCAL JURISDICTION REINSURERS

Act 113 of 2020 was signed into law by the Governor in November of 2020. Act 113 incorporates the National Association of Insurance Commissioners' (NAIC) Credit for Reinsurance Model Law (#785) which incorporates the requirements of two agreements (Covered Agreement) between the United States and the European Union (EU) and also between the United States and the United Kingdom (UK) regarding new measures regarding reinsurance. Act 113 also creates a new type of jurisdiction, known as a Reciprocal Jurisdiction, and provides reciprocal jurisdiction status for accredited U.S. jurisdictions and qualified jurisdiction as long as they meet certain statutory requirements. Act 113 eliminates reinsurance collateral and local presence requirements in the U.S. for EU and UK reinsurers that maintain a minimum amount of their own funds. Conversely, U.S. reinsurers that maintain certain minimum statutory capital and surplus will not be required to maintain a local presence in order to do business in the EU or UK. The new standards implemented in Act 113 are required for the Department's accreditation with the NAIC.

A jurisdiction can be designated as a reciprocal jurisdiction by the Commissioner if it meets the requirements set forth in 40 P.S. § 442.3(k). 

The department is accepting applications to become a reciprocal jurisdiction reinsurer. The department is working in coordination with the NAIC's Reinsurance Task Force on the designation of qualified jurisdictions and with the Reinsurance Financial Analysis Working Group to allow "passporting" of companies that have been certified in another state.
 

Uniform Checklist for Reciprocal Jurisdiction Reinsurers

Form CR-F

Form CR-F Instructions

Form CR-S

Form CR-S Instructions

Reciprocal Jurisdictions Subject to a Covered Agreement:

United Kingdom of Great Britain (England, Scotland, Wales, and Northern Ireland)
Bermuda: Bermuda Monetary Authority (BMA)
Japan: Financial Services Agency (FSA)
Switzerland: Financial Market Supervisory Authority (FINMA)

Member States of the European Union: 

Reciprocal Jurisdictions Accredited by the NAIC: