| (a) In the case of a downgrade by an NRSRO or other
negative change to rating criteria, the Commissioner will assign a
new rating to the certified assuming insurer in accordance with the
requirements of this subchapter and notify the certified assuming
insurer in writing.
(b) If the Commissioner upgrades the assigned rating
of a certified assuming insurer, the certified assuming insurer may
meet the security requirements applicable to its new rating on a prospective
basis, provided that the certified assuming insurer posts security
under the previously applicable security requirements as to all contracts
in force on or before the effective date of the upgraded rating. If
the Commissioner downgrades the assigned rating of a certified assuming
insurer, the certified assuming insurer is subject to and must meet
the security requirements applicable to its new rating for all business
it has assumed as a certified assuming insurer.
(c) The Commissioner may, after notice and opportunity
for hearing as required under Insurance Code §493.1038(b), suspend
or revoke a certified assuming insurer's certification at any time
if the certified assuming insurer fails to meet its obligations or
security requirements under Insurance Code Chapter 493 or this subchapter,
including the certified assuming insurer's financial or operating
results, or documented delays in payment by the certified assuming
insurer that lead the Commissioner to reconsider the certified assuming
insurer's ability or willingness to meet its contractual obligations.
(d) If the Commissioner suspends or revokes the certification
of a certified assuming insurer, the ceding insurer may not continue
to take credit for reinsurance ceded to the assuming insurer unless
the assuming insurer posts security in accordance with Insurance Code §493.1038.
The Commissioner may allow up to 90 days for an order suspending or
revoking an assuming insurer's certification to become effective.
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