210 Neb. Admin. Code, ch. 56, § 002 - Purpose

002.01 The purpose of this Rule is to improve the Nebraska Insurance Department's surveillance of the financial condition of Insurers by requiring (1) an annual audit of financial statements reporting the financial position and the results of operations of Insurers by independent certified public accountants, (2) Communication of Internal Control Related Matters Noted in an Audit, (3) Management's Report of Internal Control over Financial Reporting.

002.02 This Rule shall apply to all Insurers as defined in Section 003.09. Insurers having direct premiums written in this state of less than $1,000,000 in any calendar year and less than 1,000 policyholders or certificate holders of direct written policies nationwide at the end of the calendar year shall be exempt from this Rule for the year (unless the Director makes a specific finding that compliance is necessary for the Director to carry out statutory responsibilities) except that the Insurers having assumed premiums pursuant to contracts and/or treaties of reinsurance of $1,000,000 or more will not be so exempt.

002.02(a) Assessment associations subject to Neb. Rev. Stat. § 44-801 et. seq. shall be exempt from the requirements of this Rule unless the assessment association is operating in or licensed in another state.

002.03 Foreign or alien Insurers filing Audited financial reports in another state, pursuant to such other state's requirement of Audited financial reports, which has been found by the Director to be substantially similar to the requirements herein, are exempt from Sections 004 through 013 of this Rule if:

002.03(a) A copy of the Audited financial report, Communication of Internal Control Related Matters Noted in An Audit, and the Accountants' Letter of Qualifications which are filed with such other state are filed with the Director in accordance with the filing dates specified in Sections 004 and 011 and 012, respectively. Canadian Insurers may submit accountants' reports as filed with the Office of the Superintendent of Financial Institutions, Canada.

002.03(b) A copy of any Notification of Adverse Financial Condition Report filed with such other state is filed with the Director within the specified time in Section 010.

002.04 Foreign or alien Insurers required to file Management's Report of Internal Control over Financial Reporting in another state are exempt from filing the Report in this state provided the other state has substantially similar reporting requirements and the Report is filed with the Director of the other state within the time specified.

002.05 This Rule shall not prohibit, preclude or in any way limit the Director of Insurance from ordering, conducting or performing examinations of Insurers under the Statutes and the Rules and Regulations of the Nebraska Department of Insurance and the practices and procedures of the Nebraska Department of Insurance.

Notes

210 Neb. Admin. Code, ch. 56, § 002