Reinsurance Security Agreement Template for Philippines

The Reinsurance Security Agreement is essential in the Philippine insurance market where reinsurance companies need to provide security for their obligations to local insurers. This document becomes necessary when a reinsurer needs to establish collateral arrangements to secure its obligations under one or more reinsurance treaties or agreements. It must comply with the Insurance Code of the Philippines (Republic Act No. 10607) and Insurance Commission regulations, particularly regarding security requirements and collateral arrangements. The agreement typically includes specific provisions for collateral valuation, maintenance requirements, and enforcement mechanisms, while addressing both domestic and international reinsurance relationships. It's particularly relevant in cases where the reinsurer is not locally licensed or needs to provide additional security for its obligations.

1. Parties: Identification of the reinsured (cedant), reinsurer, and any security trustee or custodian

2. Background: Context of the reinsurance relationship and purpose of the security agreement

3. Definitions: Detailed definitions of technical terms, including regulatory references and calculation methodologies

4. Security Creation: Legal provisions establishing the security interest over the collateral

5. Collateral Requirements: Specifications for acceptable forms of collateral, valuation methods, and maintenance requirements

6. Deposit and Withdrawal Mechanics: Procedures for depositing and withdrawing collateral, including timing and notice requirements

7. Representations and Warranties: Standard and specific representations from each party regarding authority, compliance, and collateral

8. Covenants: Ongoing obligations of the parties regarding maintenance of security, reporting, and regulatory compliance

9. Events of Default: Circumstances constituting default and consequences thereof

10. Rights and Remedies: Actions available to parties upon default or breach

11. Term and Termination: Duration of the agreement and termination provisions

12. Governing Law and Jurisdiction: Choice of Philippine law and jurisdiction provisions