Practice/Industry Group Overview
When insurance companies seek capital solutions, they turn to Sutherland for advice that helps them craft and execute cost-effective transactions.
Insurance companies confront myriad regulatory, tax, accounting and structuring considerations when they look for financing solutions, so they need lawyers with a broad range of experience and deep industry knowledge. Sutherland attorneys have spent decades helping insurance companies open new markets and pursue new opportunities.
Sutherland’s Insurance Finance practice advises clients on complex transactions that enable them to improve liquidity, strengthen capital, manage risks and expand businesses. Sutherland’s multidisciplinary approach allows us to draw on finance, insurance, reinsurance, securities, commodities and tax experience to help insurance companies find the best financing solutions.
Our understanding of the insurance business encompasses operations, regulations, taxation and the industry market. Sutherland guides insurance companies through XXX and AXXX transactions in the United States and overseas. We handle captives and funds, equity offerings, securitizations and insurance-linked securities, catastrophe (CAT) bonds and extreme mortality bonds, equity-linked products and private placements, debt offerings, premium financing, investment grade bonds and hybrids, derivatives and industry loss warranties, BOLI, COLI, bespoke insurance coverage, all forms of reinsurance, surplus notes and securities backed by funding agreements and distressed debt trading and restructuring. We develop solutions that allow insurance companies to manage tactical day-to-day issues as well as implement strategic, long-term plans.
Experience. Our team draws on decades of practice in insurance, reinsurance, securities offerings, M&A, lending, distribution, corporate governance, derivatives, securitizations, commodities, funds, product design, tax and other essential areas to help insurance companies get access to capital.
Focus. Financing is complicated in a regulated industry. Our focus in the insurance sector and thorough understanding, particularly in insurance and reinsurance regulation and insurance tax, enable us to develop sophisticated financing options to secure needed capital efficiently.
Mitigating regulatory strains. Regulation XXX and AG 38 add reserve strains to life insurance companies, and our attorneys know how to evaluate and implement strategies to moderate these effects.
Strong securities background. Insurance companies often look to raise funds through registered and unregistered securities. Our team is intimately familiar with the implications of the Securities Act of 1933, the Securities Exchange Act of 1934 and the Investment Company Act of 1940.
International connections. Our attorneys design and implement captives and other financing vehicles for insurers domiciled domestically and outside of the United States, including those established in Ireland, Bermuda, the Cayman Islands and the Isle of Man. We have established relationships with leading law firms in these countries that allow us to provide comprehensive advice to clients and help develop sophisticated and diverse insurance programs.
Refined understanding of swaps and derivatives. We are particularly well versed in the use of derivatives, which pose unique regulatory challenges.
Private placement financings. Our attorneys have exceptional knowledge of private placement financings.
Scalability. Our team has the ability to handle transactions of any size. We handle a wide range of transactions of varying strategic importance.
Nuts and Bolts
As part of the firm’s financial services industry practice, we represent insurance and other financial services companies in a wide variety of financing transactions.
- Equity offerings
- Insurance-linked securities (ILS)
- Catastrophe (CAT) bonds and extreme mortality bonds
- Equity-linked products and private placements
- Investment grade bonds and hybrids
- Regulation XXX and AG 38
- Short-term and long-term reinsurance letters of credit, surplus note issuances and synthetic structures
- Surplus notes for mutual and stock insurance companies
- Securities and Exchange Commission Rule 144A
- Derivatives and industry loss warranties
- Credit default swaps
- Interest rate swaps
- Foreign exchange swaps
- Equity derivatives and total return swaps
- Swaps of natural catastrophe risk, weather risk, mortality/longevity tied to pools of lives, payments tied to mortality indices and industry loss warranty programs
- Securities backed by funding agreements
- Offshore vehicles
- Commercial paper programs
- Insurance-backed obligations
- Unsecured notes and general debt obligations
- Asset-backed securities
- Captives and funds
- Premium finance
- BOLI/COLI/Stable Value
- Bespoke insurance coverage
- Variable life insurance and annuity products
- Coverage for carbon trading risks, representation and warranty risks, tax risks, novel political risks and unusual errors and omissions risks
- Distressed debt trading and restructuring
Sutherland’s Insurance Finance Practice can open doors and find solutions that allow insurance companies to gain stronger financial footing and expand into new markets.
Sutherland represents a large life insurer in financings worth more than $6 billion.
Sutherland represented a large life insurer in several XXX and AXXX funding solutions, including recourse and nonrecourse structures involving letters of credit, surplus notes, trust notes and collateral notes backed by securities lending transactions.
Sutherland advises large annuity writer on variable annuities with guaranteed living benefits.
A large annuity writer sought Sutherland’s representation in establishing facilities to manage its guaranteed living benefits liabilities.
Articles Authored by Lawyers at this office:
How Technology May Affect Insurance in 2017
, January 12, 2017
Marsh has released a new report on trends anticipated in the United States casualty insurance marketplace in 2017. It noted that the Internet of Things, the sharing economy, and autonomous vehicles will all begin to make major changes to the insurance business in the coming year. In particular,...
NY DFS Publishes Revised Proposed Cybersecurity Rules for Financial Services Companies
Mark D. Herlach,John S. Pruitt,Stephen E. Roth,Cynthia R. Shoss,Phillip E. Stano, January 02, 2017
On December 28, 2016, the New York Department of Financial Services (the DFS) published a revised proposed cybersecurity regulation (the Revised Regulation) for further public comment. First published in September 2016, the Revised Regulation is a culmination of three years of work by the DFS to...
NAIC Report: 2016 Fall National Meeting
B. Scott Burton,Ling Ling,Michael R. Nelson,John S. Pruitt,Stephen E. Roth, December 30, 2016
The National Association of Insurance Commissioners (NAIC) held its 2016 Fall National Meeting December 10-13. Despite the glitzy setting at the Fontainebleau Hotel in Miami Beach, there were no splashy new developments—save the announcement of the appointment of Michael Consedine as NAIC...
Enhanced Cyber Risk Management Standards Announced in Joint Rulemaking Initiative by Treasury, Federal Reserve, and FDIC
Mark D. Herlach,John S. Pruitt,Stephen E. Roth,Cynthia R. Shoss,Phillip E. Stano, December 29, 2016
On October 19, 2016, the three major federal banking regulators announced a joint advance notice of proposed rulemaking (ANPR) for enhanced cyber risk management standards (Enhanced Standards) for large and interconnected federally regulated financial institutions and their third-party service...
NAIC Adopts Revisions to Actuarial Guideline 49
Eric A. Arnold,Frederick R. Bellamy,Thomas E. Bisset,Dodie C. Kent,Clifford E. Kirsch, December 19, 2016
On December 13, the National Association of Insurance Commissioners (NAIC) Executive (EX) Committee and Plenary adopted revisions to Actuarial Guideline 49 (AG 49) with an effective date of March 1, 2017. The revisions apply AG 49’s standards for determining the maximum annual rate of...
Cybersecurity Certifications Now Required to Access Death Master File
Wilson G. Barmeyer,Robert D. Owen,Phillip E. Stano,Steuart H. Thomsen,Mary Jane Wilson-Bilik, November 14, 2016
Tough cybersecurity certification requirements for parties seeking access to certain information in the Social Security Death Master File (DMF) take effect on November 28.
STOLI Scheme Saved By Expiration of Contestability Clause
Wilson G. Barmeyer,Kristine M. Ellison,Phillip E. Stano,Steuart H. Thomsen,Gail L. Westover, October 05, 2016
On September 22, the Florida Supreme Court in Wells Fargo Bank NA v. Pruco Life Insurance Co., No. SC15-382 (Fla. Sept. 22, 2016) denied Pruco Life Insurance Company’s challenge to the validity of an insurance policy purchased under a stranger-originated life insurance (STOLI) scheme because...
A New Way to Buy Car Insurance?
, September 23, 2016
A car insurance startup has recently acquired an insurance company with licenses in 50 states. Metromile, which has received funding from investors such as Mark Cuban, charges for car insurance based on miles driven. (A hardware “dongle” tracks how many miles the subscriber drives.) The...
NY DFS Announces Proposal for Cybersecurity Rules for Financial Services Companies
Mark D. Herlach,John S. Pruitt,Stephen E. Roth,Cynthia R. Shoss,Phillip E. Stano, September 22, 2016
On September 13, 2016, New York Governor Andrew Cuomo announced a proposal by the New York Department of Financial Services (the DFS) of a rule that establishes cybersecurity requirements for financial services companies regulated by the DFS (the NY Regulation). The NY Regulation is the culmination...
NAIC Report: 2016 Summer National Meeting
B. Scott Burton,Ling Ling,Michael R. Nelson,John S. Pruitt,Cynthia R. Shoss, September 07, 2016
The National Association of Insurance Commissioners (NAIC) held its 2016 Summer National Meeting from August 26 through August 29 in San Diego, California.
NAIC Task Force Releases Revised Draft Insurance Data Security Model Law
Mark D. Herlach,John S. Pruitt,Stephen E. Roth,Cynthia R. Shoss,Mary Jane Wilson-Bilik, August 30, 2016
On August 17, the National Association of Insurance Commissioners (the NAIC) Cybersecurity (EX) Task Force (the Task Force) released for comment a revised draft Insurance Data Security Model Law (the Model Law). This Model Law purports to “establish exclusive standards . . . for data security...
Auto Insurers, Buckle Up — Automated Tech Is Already Here
, August 08, 2016
Many auto insurers have developed a false sense of security based on a belief that vehicles with automated driving technology are still several years off, but recent events have demonstrated that the public is buying and driving cars that have a high degree of automation. Auto insurers, whose...
NAIC Life Insurance and Annuities (A) Committee Adopts Revisions to Actuarial Guideline 49
Eric A. Arnold,Frederick R. Bellamy,Thomas E. Bisset,Dodie C. Kent,Clifford E. Kirsch, August 01, 2016
On July 27, 2016, the Life Insurance and Annuities (A) Committee adopted revisions to Actuarial Guideline 49 (AG 49) to address situations where indexed universal life (IUL) insurance policies make available multiple index account options with different account charges (the dual account issue). The...
Insurers Preparing for a World of Autonomous Vehicles
, July 28, 2016
When autonomous vehicles become ubiquitous, what will be the need for car insurance? That is the question auto insurers are beginning to face as autonomous vehicle technology promises safer roads and fewer accidents. At least one insurer, State Farm, is participating in research on driverless car...
Insurers Should Actively Monitor Automated Driving Technology Developments
, July 21, 2016
Automated technology will bring both new challenges and new opportunities for insurers. Although insurers may face the challenges associated with a shrinking market where manufacturers absorb more liability risk, insurers also have new opportunities. For example, such opportunities include new and...
New York Issues Two Advisory Opinions Regarding Surplus Lines Insurance
Michele Borens,Jonathan A. Feldman,Jeffrey A. Friedman,Todd A. Lard,Carley A. Roberts, July 01, 2016
The New York State Department of Taxation and Finance (Department) issued two advisory opinions determining that unauthorized non-life insurance corporations (here, surplus lines insurance companies) are subject to insurance franchise tax (under N.Y. Tax Law § 1502) instead of premium tax...
Insurance Coverage for Driverless Cars
, June 30, 2016
Who is liable for accidents involving autonomous vehicles? At least one insurance company in Britain is now offering an auto policy that will cover autonomous and partly automated vehicles. The policy covers accidents caused by malfunctions in the car’s driverless systems, as well as...
Insurers Aim to Use New Technology To Make Cars “Marketing Machines”
, June 24, 2016
Modern cars capture vast amounts of information about drivers through various computer technologies, tracking where drivers are going, when, and how they are driving. A new study from McKinsey and Company suggests that the future of car insurance lies in harnessing that data: by collecting and...
NAIC Task Force Continues Work on Insurance Data Security Model Law
John S. Pruitt,Cynthia R. Shoss,Mary Jane Wilson-Bilik,John Allen Zumpetta, June 07, 2016
On May 24 and 25, the National Association of Insurance Commissioners (the NAIC) Cybersecurity (EX) Task Force (the Task Force) hosted a meeting in which state insurance commissioners and interested parties were invited to provide comments to and voice concerns about the current draft of the...
Deloitte Predicts Changes to Auto Insurance Due to “the Future of Mobility”
, June 06, 2016
Deloitte has released a white paper analyzing trends and potential future changes in auto insurance. Two key trends addressed are the rise of autonomous vehicles and the shift from individual vehicle ownership toward the sharing economy. Members of Deloitte’s actuarial practice modeled how...
NAIC Task Force Hosts Insurance Data Security Model Law Meeting
, May 31, 2016
On May 24 and 25, the National Association of Insurance Commissioners (the “NAIC”) Cybersecurity (EX) Task Force (the “Task Force”) hosted a meeting in which state insurance commissioners and interested parties were invited to provide comments to and voice concerns about the...
NAIC Report: 2016 Spring National Meeting
Frederick R. Bellamy,Ling Ling,John S. Pruitt,Cynthia R. Shoss,Mary Jane Wilson-Bilik, May 25, 2016
The National Association of Insurance Commissioners (NAIC) held its 2016 Spring National Meeting from April 1 through April 6 in New Orleans, Louisiana. As host, Louisiana provided beautiful weather and bountiful great food. The Spring National Meeting was also highlighted by spirited discussions...
Unclaimed Property Primer for Health and Property & Casualty Insurance
Wilson G. Barmeyer,Holly H. Smith,Phillip E. Stano,Steuart H. Thomsen,Mary Jane Wilson-Bilik, May 17, 2016
Unclaimed Property: It’s not just about life insurance. The same contingency-fee unclaimed property auditors that targeted unclaimed life insurance proceeds are now turning their focus to other types of insurance, including health insurance and property & casualty insurance (P&C). For...
Basic-Supplemental Life Insurance Plan Pricing Structure Upheld in ERISA Class Action
Wilson G. Barmeyer,Carol T. McClarnon,Phillip E. Stano,Steuart H. Thomsen,Gail L. Westover, May 05, 2016
An employee benefit plan that includes an alleged subsidization component for its basic and supplemental options is neither prohibited by the Employee Retirement Income Security Act of 1974 (ERISA) nor a violation of the plan sponsor or service provider’s fiduciary duties, a federal district...
Conference Addresses Challenges in AV Deployment
, April 20, 2016
On April 15, 2016, the University of Michigan Law School hosted Autonomous Vehicles: Legal and Regulatory Hurdles to Deployment. Representatives from the National Highway Traffic Safety Administration (NHTSA), automakers, insurers, and academia discussed the legal challenges autonomous technology...
Automakers Reach out to Auto Insurers on Recalls
, April 14, 2016
Two associations representing the largest automakers in the world have asked the auto insurance industry to assist them by reminding insureds of recalls when they renew their policies. The Alliance of Automobile Manufacturers and the Association of Global Automakers made their request in letters to...
NHTSA To Propose Safety Guidelines For New and Emerging Technology
, April 01, 2016
The National Highway Traffic Safety Administration is submitting a proposed enforcement guideline to address safety concerns relating to new and emerging technology, such as automated vehicles and crash avoidance technology. The NHTSA acknowledged that the increased use of electronic systems has...
Interagency Guidance: CIP Requirements Apply to Certain Prepaid Cards
Brian Barrett,Brian M. Murphy,Robert J. Pile,John Allen Zumpetta, March 30, 2016
On March 21, the Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency (OCC), and the U.S. Department of Treasury’s Financial Crimes Enforcement Network (collectively, the...