New Tax Rules for Catastrophic Risk Transfer Companies
This act introduces new tax rules for companies that specialize in insuring catastrophic risks, such as natural disasters. The goal is to ensure these companies have enough capital to pay out claims in the event of large losses. For citizens, this could mean greater stability in the insurance market when facing severe events.
Key points
Catastrophic risk transfer companies will have specific tax rules to build capital for claims payouts.
The act defines what constitutes a catastrophic risk (e.g., losses exceeding $25 million) and what investments are permitted for these companies.
Rules are established for how income from these companies is taxed for their security holders, including tax exemptions for certain foreign investors.
Prohibition of double taxation on reinsurance premiums by different states, aiming to facilitate nationwide operations for these companies.
Expired
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