Non-US reinsurers from qualified jurisdictions will benefit from reduced reinsurance collateral requirements in the United States in 2015.
Next year will see additional US states adopt the revised National Association of Insurance Commissioners credit for reinsurance model law and regulation, which allow non-US reinsurers from "qualified jurisdictions" to become "certified reinsurers".
A certified reinsurer can be eligible to post less than 100% collateral for reinsurance assumed from US ceding companies; the required collateral level can be 75%, 50%, 20%, 10% or 0% depending on the reinsurer's financial strength ratings from recognized agencies and other criteria.
The qualified jurisdictions in 2015 will include Bermuda, France, Germany, Ireland, Japan, Switzerland and United Kingdom. As a result, rated reinsurers from those jurisdictions that become certified will have access to the US market with reduced collateral requirements.