A. In this chapter, the following terms have the meanings indicated.
B. Terms Defined.
(1) "Accredited reinsurer" means an unauthorized insurer who is accepted by the Commissioner to act as a reinsurer in the State under Insurance Article, §5-906, Annotated Code of Maryland.
(2) "Beneficiary" means:
(a) The entity for whose sole benefit the trust has been established; or
(b) Any successor of the beneficiary by operation of law or, if a court of law appoints a successor in interest to the named beneficiary, then the named beneficiary is the court appointed domiciliary receiver, including conservator, rehabilitator, or liquidator.
(a) "Grantor" means the entity that has established a trust for the sole benefit of the beneficiary.
(b) When established in conjunction with a reinsurance contract, the grantor is the unauthorized unaccredited assuming insurer.
(4) "Liabilities", as used in Regulations .08.11 of this chapter, means the assuming insurer's gross liabilities attributable to reinsurance ceded by U.S. domiciled insurers that are not otherwise secured by acceptable means, and shall include:
(a) For business ceded by domestic insurers authorized to write accident and health, and property and casualty insurance:
(i) Losses and loss adjustment expenses paid by the ceding insurer, recoverable from the assuming insurer;
(ii) Reserves for losses reported and outstanding;
(iii) Reserves for losses incurred but not reported;
(iv) Reserves for loss adjustment expenses; and
(v) Unearned premiums; and
(b) For business ceded by domestic insurers authorized to write life, health, and annuity insurance:
(i) Aggregate reserves for life policies and contracts net of policy loans and net due and deferred premiums;
(ii) Aggregate reserves for accident and health policies;
(iii) Deposit funds and other liabilities without life or disability contingencies; and
(iv) Liabilities for policy and contract claims.
(5) "Mortgage-related security", as used in Regulation .10 of this chapter, means an obligation that is rated AA or higher (or the equivalent) by a nationally recognized statistical rating organization approved by the Securities Valuation Office and that either:
(a) Represents ownership of one or more promissory notes or certificates of interest or participation in the notes (including any rights designed to assure servicing of, or the receipt or timeliness of receipt by the holders of the notes, certificates, or participation of amounts payable under, the notes, certificates or participation), that:
(i) Are directly secured by a first lien on a single parcel of real estate, including stock allocated to a dwelling unit in a residential cooperative housing corporation, upon which is located a dwelling or mixed residential and commercial structure, or on a residential manufactured home as defined in 42 U.S.C. §5402(6), whether the manufactured home is considered real or personal property under the laws of the state in which it is located; and
(ii) Were originated by a savings and loan association, savings bank, commercial bank, credit union, insurance company, or similar institution that is supervised and examined by a federal or state housing authority, or by a mortgagee approved by the Secretary of Housing and Urban Development pursuant to 12 U.S.C. §§1709 and 1715-b, or, where the notes involve a lien on the manufactured home, by an institution or by a financial institution approved for insurance by the Secretary of Housing and Urban Development pursuant to 12 U.S.C. §1703; or
(b) Is secured by one or more promissory notes or certificates of deposit or participations in the notes (with or without recourse to the insurer of the notes) and, by its terms, provides for payments of principal in relation to payments, or reasonable projections of payments, or notes meeting the requirements of §B(5)(a)(i) and (ii) of this regulation.
(6) “NAIC” means National Association of Insurance Commissioners.
(7) "Obligations", as used in Regulation .17 of this chapter, means:
(a) Reinsured losses and loss adjustment expenses paid by the ceding insurer, but not recovered from the assuming insurer;
(b) Reserves for reinsured losses reported and outstanding;
(c) Reserves for reinsured losses incurred but not reported; and
(d) Reserves for allocated reinsured loss expenses and unearned premiums.
(8) "Promissory note", as used in Regulation .10 of this chapter, when used in connection with a manufactured home, also includes a loan, advance, or credit sale as evidenced by a retail installment sales contract or other instrument.
(9) “Qualified jurisdiction” has the meaning set forth in Insurance Article, §5-901(d), Annotated Code of Maryland.
(10) "Qualified U.S. financial institution" means:
(a) For purposes of those provisions of Regulation .14 of this chapter specifying those institutions that are eligible to act as a fiduciary of a trust, an institution that:
(i) Is organized, or in the case of a U.S. branch or agency office of a foreign banking organization, licensed, under the laws of the United States or any state and has been granted authority to operate with fiduciary powers; and
(ii) Is regulated, supervised, and examined by federal or state authorities having regulatory authority over banks and trust companies; or
(b) For purposes of those provisions of Regulation .14 of this chapter specifying those institutions that are eligible to issue letters of credit, an institution that:
(i) Is organized or, in the case of a U.S. office of a foreign banking organization, licensed, under the laws of the United States or any state;
(ii) Is regulated, supervised, and examined by U.S. federal or state authorities having regulatory authority over banks and trust companies; and
(iii) Has been determined by either the Commissioner or the Securities Valuation Office of the NAIC to meet the standards of financial condition and standing as are considered necessary and appropriate to regulate the quality of financial institutions whose letters of credit will be acceptable to the Commissioner.
(11) “Reinsurance intermediary” has the meaning set forth in Insurance Article, §8-501(e), Annotated Code of Maryland.
(12) "Securities Valuation Office" refers to the Securities Valuation Office of the NAIC.