N.Y. ISC Law § 4706

§ 4706. Reserve and surplus requirements. (a) Notwithstanding any\nprovision of law, the governing board of a municipal cooperative health\nbenefit plan shall establish a reserve fund, and the plan's chief fiscal\nofficer shall cause to be paid into the reserve fund the amounts\nnecessary to satisfy all contractual obligations and liabilities of the\nplan, including:\n (1) a reserve for payment of claims and expenses thereon reported but\nnot yet paid, and claims and expenses thereon incurred but not yet\nreported which shall not be less than an amount equal to twenty-five\npercent of expected incurred claims and expenses thereon for the current\nplan year, unless a qualified actuary has demonstrated to the\nsuperintendent's satisfaction that a lesser amount will be adequate;\n (2) a reserve for unearned premium equivalents;\n (3) a claim stabilization reserve;\n (4) a reserve for other obligations of the municipal cooperative\nhealth benefit plan; and\n (5) a surplus account, established and maintained for the sole purpose\nof satisfying unexpected obligations of the municipal cooperative health\nbenefit plan in the event of termination or abandonment of the plan,\nwhich shall not be less than:\n (A) five percent of the annualized earned premium equivalents during\nthe current fiscal year of a municipal cooperative health benefit plan\nwhich consists of five or more participating municipal corporations and\ncovers two thousand or more employees and retirees; or\n (B) seven percent of the annualized earned premium equivalents during\nthe current fiscal year of the municipal cooperative health benefit plan\nwhich consists of four or fewer participating municipal corporations or\ncovers fewer than two thousand employees and retirees.\n (b) The moneys in the plan's reserve funds and surplus account shall\nbe deposited in one or more banks or trust companies designated by the\ngoverning board in accordance with the municipal cooperation agreement,\nin one or more separate segregated accounts, subject to investment in\nobligations specified in the general municipal law or education law (as\napplicable) for investment of moneys in reserve funds or as otherwise\nexpressly permitted by the superintendent. Any such bank or trust\ncompany shall be located in this state and shall be duly chartered\npursuant to federal law or the laws of this state. Any interest earned\nor capital gain realized on the money so deposited or invested shall\naccrue to and become part of the plan's reserve funds or surplus\naccount, as applicable.\n (c) The plan's chief fiscal officer shall account for the plan's\nreserve funds separate and apart from all other funds of the municipal\ncooperative health benefit plan, and such accounting shall show:\n (1) the purpose, source, date and amount of each sum paid into the\nfund;\n (2) the interest earned by such funds;\n (3) capital gains or losses resulting from the sale of investments of\nthe plan's reserve funds;\n (4) the order, purpose, date and amount of each payment from the\nreserve fund; and\n (5) the assets of the fund, indicating cash balance and schedule of\ninvestments.\n (d) The plan's chief fiscal officer, within ninety days of the end of\neach fiscal year, shall furnish a detailed report of the operations and\ncondition of the plan's reserve funds to the governing board.\n (e) An expenditure from the plan's reserve funds shall be made only\nfor the payment of benefits and other obligations of the municipal\ncooperative health benefit plan or expenses incurred in administering\nsuch plan.\n (f) If the municipal cooperative health benefit plan ceases to provide\nplan benefits on a shared-funding basis, the moneys remaining in the\nplan's reserve funds not needed to satisfy plan liabilities incurred\nprior to such cessation shall be disposed of in the manner provided in\nthe municipal cooperation agreement.\n (g) If a municipal corporation withdraws from a municipal cooperative\nhealt
(f) If the municipal cooperative health benefit plan ceases to provide\nplan benefits on a shared-funding basis, the moneys remaining in the\nplan's reserve funds not needed to satisfy plan liabilities incurred\nprior to such cessation shall be disposed of in the manner provided in\nthe municipal cooperation agreement.\n (g) If a municipal corporation withdraws from a municipal cooperative\nhealth benefit plan operating under a certificate of authority, the\ngoverning board shall, in accordance with the municipal cooperation\nagreement, determine the amount, if any, of the plan's reserve funds\nattributable to such municipal corporation, after considering all plan\nliabilities, and dispose of such amount in the manner provided in the\nmunicipal cooperation agreement.\n