§ 58-10-25. Definitions. - North Carolina Statutes

§ 58‑10‑25. Definitions.

(a)        As used in thisPart:

(1)        Assuming insurer. –The insurer that acquires an insurance obligation or risk from the transferringinsurer under an assumption reinsurance agreement.

(2)        Assumptionreinsurance agreement. – Any contract, arrangement, or plan that:

a.         Transfers insuranceobligations or risks of existing or in‑force policies from a transferringinsurer to an assuming insurer.

b.         Is intended toeffect a novation of transferred policies with the result that the assuming insurerbecomes directly liable to the policyholders of the transferring insurer andthe transferring insurer's insurance obligations or risks under the policiesare extinguished.

(3)        Home servicebusiness. – Insurance business on which premiums are collected on a weekly ormonthly basis by an agent of the insurer.

(4)        Policy. – A contractof insurance as defined in G.S. 58‑1‑10.

(5)        Policyholder. – Anyperson that has the right to terminate or otherwise alter the terms of apolicy. It includes any group policy certificate holder whose certificate is inforce on the proposed effective date of the assumption, if the certificateholder has the right to keep the certificate in force without any change inbenefits after termination of the group policy. The right to keep thecertificate in force referred to in this subdivision does not include the rightto elect individual coverage under the Consolidated Omnibus BudgetReconciliation Act ("COBRA"), section 601, et seq., of the EmployeeRetirement Income Security Act of 1974, as amended, 29 U.S.C. § 1161, et seq.

(6)        Transferringinsurer. – The insurer that transfers an insurance obligation or risk to anassuming insurer under an assumption reinsurance agreement.

(b)        For the purposes ofthis Part, a "novation" does not require the formation of a newpolicy or the amendment of an existing policy between the assuming insurer andthe policyholder. (1995, c. 318, s. 1; 1995 (Reg. Sess., 1996), c. 752,s. 2.)