Section 168A. (a) As used in this section ''eligible alien unauthorized insurer'' shall mean a company formed under the laws of any government or state other than the United States or 1 of its states or its territories that has filed an application with the commissioner under clause (4) of subsection (c), which application has been approved by the commissioner.
(b) Notwithstanding any general or specific law to the contrary, a special broker licensed by the commissioner pursuant to section 168 of this chapter may procure insurance from any company formed under the laws of any government or state other than the United States or one of its states or its territories that is not authorized to transact business in the commonwealth if:
(1) such company has been determined by the commissioner to be an eligible alien unauthorized insurer pursuant to clause (4) of subsection (c);
(2) the special broker has executed and filed an affidavit with the commissioner within 20 days after procuring such insurance stating that the full amount or type of insurance cannot be obtained from among companies admitted to transact insurance in the commonwealth after a diligent effort has been made to do so and that the amount of insurance procured in such company is only the excess over the amount so procurable from admitted companies;
(3) the procured policy contains the disclosure notice required by section 168; and
(4) all other requirements of this section and section 168 that are not inconsistent with this subsection have been met.
Insurance procured under this section shall be valid and enforceable as to all parties.
Nothing in this section shall be deemed to amend or modify any of the provisions of, or any of the exemptions specified in, section 168 that are inconsistent with this section.
(c) No company shall be determined to be an eligible alien unauthorized insurer unless it:
(1) has provided satisfactory evidence to the commissioner of its good reputation and financial integrity;
(2) has capital and surplus or its equivalent under the laws of its domiciliary jurisdiction in an amount not less than $20,000,000;
(3) has in force a United States trust fund of not less than the greater of:
(i) $5,400,000; or
(ii) a percentage of its United States surplus lines gross liabilities arising from business written on or after January 1, 1998, excluding aviation, wet marine, transportation insurance and direct procurement placements, such percentage to equal to the percentage and subject to any cap employed by the International Insurers Department of the National Association of Insurance Commissioners, as of December 31 next preceding the date of determination, where: (A) the liabilities are maintained in an irrevocable trust account in the United States in a qualified financial institution, on behalf of United States policyholders consisting of cash, securities, letters of credit or other investments of substantially the same character and quality as those which are eligible investments under this chapter for the capital and statutory reserves of admitted insurers to write like kinds of insurance in the commonwealth; provided, however, that the trust fund, which shall be included in any calculation of capital and surplus or its equivalent, shall satisfy the requirements of the Standard Form Trust Agreement required for listing with the International Insurers Department of the National Association of Insurance Commissioners; (B) the company may request approval from the commissioner to use the trust fund to pay valid surplus lines claims; provided, however, that the balance of the trust fund shall never be less than the minimum amount required by this subsection; and (C) in calculating the trust fund amount required by this subsection, credit shall be given for surplus lines deposits separately required and maintained for a particular state or territory of the United States, not to exceed the amount of the company's loss and loss adjustment reserves in that particular state or territory; and
(4) has submitted to the commissioner an application evidencing the company's compliance with the requirements of this section that has been approved by the commissioner.
(d) The application required by clause (4) of subsection (c) shall be on forms issued or approved by the commissioner and shall include the following information regarding the alien unauthorized insurer applicant:
(1) evidence that the unauthorized alien insurer has been listed by the International Insurers Department of the National Association of Insurance Commissioners;
(2) a certified audited financial statement of the eligible alien unauthorized insurer reflecting information as of a date not more than 12 months prior to the submission of the application evidencing compliance with the capital and surplus requirements of clause (2) of subsection (c) and an actuarial opinion as to the adequacy of and methodology used to determine the insurer's loss reserves;
(3) a copy, certified by the trustee, of the United States trust agreement required by clause (3) of subsection (c) prepared in accordance with the National Association of Insurance Commissioner's Standard Form Trust Agreement for Alien Excess or Surplus Lines Insurers;
(4) a copy, certified by the trustee, of the most recent quarterly statement of account or list of assets in the trust account required by clause (3) of subsection (c) evidencing that the alien unauthorized insurer has in force, as of the end of the most recent quarter, assets in the amounts required by said clause (3) of said subsection (c);
(5) a certified copy of the eligible alien unauthorized insurer's current license or certificate of authority issued by its domiciliary jurisdiction indicating that the company is authorized to insure the types of risks in its domiciliary jurisdiction that it proposes to insure in the commonwealth;
(6) a certificate of good standing or substantially similar documentation issued by the eligible alien unauthorized insurer's domiciliary jurisdiction;
(7) biographical affidavits, on forms promulgated by the National Association of Insurance Commissioners or approved by the commissioner for all executive officers, directors and senior management personnel of the eligible alien unauthorized insurer, prepared not more that 12 months prior to the submission date of the application required by clause (4) of subsection (c); and
(8) such additional information as the commissioner may require in order to determine that the eligible alien unauthorized insurer complies with the requirements of this section.
(e) The commissioner may refuse to approve an application under this section if the commissioner determines that such refusal will be in the public interest. In reviewing an application, the commissioner may consider:
(1) the length of time the insurer has been authorized in its domiciliary jurisdiction and elsewhere;
(2) the unavailability of the particular coverages from authorized insurers or unauthorized insurers meeting the requirements of this section and section 168;
(3) the size of the company as measured by its assets, capital and surplus, reserves, premium writings, insurance in force or other appropriate criteria;
(4) the kinds of business the company writes, its net exposure and the extent to which the company's business is diversified among several lines of insurance and geographic locations; and
(5) the past and projected trend in the size of the company's capital and surplus considering such factors as premium growth, operating history, loss and expense ratios or other appropriate criteria.
(f) The commissioner may revoke a company's status as an eligible alien unauthorized insurer in accordance with the terms and conditions of section 5 the commissioner has determined that the insurer:
(1) is in unsound financial condition or has acted in an untrustworthy manner;
(2) no longer meets the standards in subsection (c);
(3) has willfully violated the laws of the commonwealth; or
(4) does not conduct a proper claims practice.