LD 1553
pg. 15
Page 14 of 25 An Act To Permit Special Purpose Reinsurance Vehicles Page 16 of 25
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LR 1915
Item 1

 
(a)__To transfer all such assets into one or more
trust accounts pursuant to Paragraph L for the
benefit of the ceding insurer pursuant to the terms
of the contract and in compliance with this
subchapter; and

 
(b)__To pay any other amounts that the ceding
insurer claims are due under the contract.

 
N.__The contract entered into by the reinsurance vehicle may
contain provisions that give the reinsurance vehicle the
right to seek approval from the ceding insurer to withdraw
from the trust account referred to in paragraph E all or
part of the assets contained in the trust account and to
transfer the assets to the reinsurance vehicle as long as:

 
(1)__The reinsurance vehicle shall at the time of the
withdrawal replace the withdrawn assets with other
qualified assets having a fair value equal to the fair
value of the assets withdrawn and that meet the
requirements of section 795; and

 
(2)__After the withdrawals and transfer, the fair value
of the assets in the trust account referred to in
paragraph E__securing the obligations of the
reinsurance vehicle under the contract is no less than
an amount needed to satisfy the full funding
requirement of the contract.__The ceding insurer has
the sole discretion to determine whether these
provisions have been satisfied but may not unreasonably
nor arbitrarily withhold its approval.

 
O.__The contract must provide that investors in the
reinsurance vehicle agree that any obligation to repay
principal, interest or dividends on the securities issued by
the reinsurance vehicle must be reduced upon the occurrence
of a triggering event, to the extent that the assets of the
reinsurance vehicle held in trust for the benefit of the
ceding insurer are remitted to the ceding insurer in
fulfillment of the obligations of the reinsurance vehicle
under the contract.

 
P.__Assets held by a reinsurance vehicle in trust must be
valued at their fair value.

 
Q.__The proceeds from the sale of securities by the reinsurance
vehicle to investors must be deposited with the trustee as
described in this subchapter and must be held or


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