The National Association of Insurance Commissioners has new requirements for settlement of affiliated company transactions. The NAIC's Statement of Statutory Accounting Principle No. 96 — Settlement Requirements for Intercompany Transactions, effective for reporting periods ending on and after December 31, 2007, requires that affiliated party transactions must be in a written agreement and must provide for timely settlement with a specified due date. Receivables from an affiliate that are more than 90 days overdue will be nonadmitted and, if the due date is not addressed in the written agreement, any uncollected receivable is nonadmitted. In addition to the impact SSAP 96 will have on financial reporting, new or amended agreements among affiliates may also give rise to Holding Company Act filing requirements.
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SSAP 96 (boring but important)
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