The long legislative session has closed, 2015 is almost over, and now is a perfect time to summarize the main statutory changes to North Carolina's insurance law. 

Captive Insurance - The first insurance-related bill to pass, S.L. 2015-99, made a series of technical corrections to the North Carolina Captive Insurance Act.  This bill contained a number of clarifying and conforming language changes.  It also gave the Insurance Commissioner discretion in setting capital and surplus limits less than $250,000 in certain special purpose captives, depending on the business plan and feasibility study (akin to the provisions already in place for pure captives).  The bill also provides for captive insurers to establish one or more separate accounts.  
Importantly, the bill gives the Insurance Commissioner the ability to waive the filing of an annual report if the captive complies with the annual audit requirement.  This provision will provide real savings for certain captive owners who use NC as a domicile compared to many other states.  The bill also gives the Insurance Commissioner the authority to provide exemptions to inactive captive insurers from filing annual reports, making premium tax filings, or paying premium taxes.  In essence, the captive is allowed to go 'dormant' for certain years, rather than being completely unwound or dissolved.  This provision is not intended to allow shelf-registrations of captives.

Insurance for mopeds - S.L. 2015-125 was hotly debated amongst many members of the bar (insurance lawyers, criminal lawyers, public interest lawyers, and personal injury lawyers).  Under this new legislation, mopeds must be insured, although they do not have to be titled and dealers do not have to be licensed (in the manner that automobile dealers are licensed).  

More specifically, various provisions were added to Chapter 20 and Chapter 58 of the General Statutes are changed.  If mopeds are to be operated on streets and roadways, they must be registered and they are only allowed to be registered if they are insured.  The North Carolina Rate Bureau will not be promulgating rates (neither liability, theft, or property damage) for mopeds.  Rates will be regulated through Chapter 58, Article 40 ("Regulation of Insurance Rates").  Moped coverage may be added to an automobile policy as a rider or endorsement.  Moped liability insurance cannot be ceded to a reinsurance facility.  

Technical corrections to various insurance statutes - S.L. 2015-146 provides various amendments to Chapter 58, the insurance chapter, of the General Statutes.  Periodically, the National Association of Insurance Commissioners (NAIC) meet to discuss insurance regulations.  These regulations are then sometimes codified as model acts or proposed statutes, which are then passed into law in each state.  S.L. 2015-146 contained various provisions originating from the NAIC, and passed to maintain accreditation by the NAIC, related to the governance of insurance company holding systems, risk-based capital requirements for life insurers, and corporate governance of risk retention groups.  

This bill will effect the mergers and acquisitions of domestic insurers.  It also gives specific outlines for the composition of the Boards of Directors of risk retention groups, including the requirement of a majority of the board members to be independent directors and contains other provisions to enhance the transparency of risk retention group board supervision and activities.  

Unemployment Insurance - S.L. 2015-238 made a number of changes to unemployment insurance.  During the recent recession, the State paid unemployment benefits by, in part, borrowing funds from the federal government (to the tune of $2.5 billion).  Unemployment insurance was overhauled in 2013 by the General Assembly, in part to collect funds to repay this amount.  North Carolina has quickly repaid the federal government and has been saving money in an Unemployment Trust Fund.  Pursuant to this statute, if the Unemployment Trust Fund reaches $1 billion by March 1, 2016, the currently-in-place 20% surtax on employers will be suspended.  

Principle-Based Reserving/Revision to Insurance Laws - Finally, S.L. 2015-281 amends Chapter 58 to require principle-based approach to life insurance reserving.  This should provide a more accurate valuation of life insurance reserves compared to the formulaic models currently used.  This bill also amends the standard non-forfeiture provision contained in N.C.G.S. 58-58-55 and provides some clarifying changes to laws regarding professional employer organizations, insurance company deposits, provides for a nine member advisory committee to be appointed by the Insurance Commissioner regarding continuing care retirement communities (which are under the supervision of the Insurance Commissioner in North Carolina), expedited health insurance external review, and an addition to N.C.G.S. 58-41-20 (the statute on notice of nonrenewals, premium rate increases, or changes in coverage).