Validus Reinsurance, Ltd. and Validus Reinsurance (Switzerland), Ltd, respectively, (the “Companies”) are accredited trusteed reinsurers in New Jersey through the establishment of multi beneficiary reinsurance trusts for the benefit of U.S. domiciled cedents.
The trusts are regulated by the New Jersey Department of Banking & Insurance and require the Companies each to fully collateralize all U.S. cedent liabilities with acceptable assets and a market value equal to or greater than the related liabilities, plus a $20 million required minimum surplus. This provides enhanced protection and convenience for U.S. cedents, including the benefit of automatic financial statement credit for reinsurance under current credit for reinsurance laws and regulations.
In order to ensure automatic financial statement credit on statutory filings, U.S. cedents are simply required to classify the Companies as non-U.S. authorized reinsurers on Schedule F-3 of their respective statutory annual statements.
The Companies will use the trusts going forward to collateralize the liabilities on new and existing business with U.S. cedents domiciled in each state, including the District of Columbia and Puerto Rico, in which each are accredited. Note that Validus Reinsurance, Ltd. has not applied for accreditation in Florida and neither Company has applied for accreditation in New York. The Companies will continue to operate as non-admitted reinsurers in respect of cedents domiciled in those states. Cedents domiciled in those states will not receive automatic financial statement credit for the reinsurance provided by the Companies and therefore the Companies will continue to collateralize cedent liabilities for these cedents by way of letters of credit.
For documentation relating to this matter please click on the links shown below.
Should you have any questions or comments on this matter please contact either of the individuals listed below.
|J. Patrick Reardon
Chief Counsel, Reinsurance
T +1 441 278 9038
T +1 441 278 7133