Florida has approved lower collateral payments for another Bermuda reinsurer, the eighth foreign reinsurer to be granted this approval by the state.
Tokio Millennium Re Ltd., a subsidiary of Tokio Marine & Nichido Fire Insurance Co., Ltd., said it has been granted approval by the Florida Office of Insurance Regulation (OIR) to post 20 percent of collateral rather than the previously required 100 percent when placing business from the Florida market.
Reinsurers can be approved for the lower requirements if they have capital and surplus of at least $100 million, proof of financial strength by at least two nationally recognized rating organizations, and evidence of continued financial soundness and stability.
In 2007, Florida lawmakers passed legislation authorizing the OIR to establish lower collateral requirements for only the most highly rated and financially sound foreign reinsurers, in hopes of encouraging global reinsurance players to increase their participation in the Florida market. Only seven other non-U.S. companies have been granted approval thus far.
Tatsuhiko Hoshina, TMR’s president and CEO, said the company hopes that more states will agree to lower the collateral requirements for foreign reinsurers.
TMR is primarily engaged in property and casualty reinsurance.
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