(a) Pursuant to the authority granted by what is now sections 201 and 301 of the Insurance Law and section 202 of the Financial Services Law, Part 63 was previously promulgated on February 15, 1980, and provided for standards for financial guaranty insurance of municipal bonds. These standards included the reserve requirements for such guaranties. Part 63 was subsequently amended, as an emergency rule, on April 22, 1986. The emergency rule was made permanent on June 19, 1986.

(b) Effective May 14, 1989, a new article 69 was added to the Insurance Law defining and authorizing the sale of certain types of financial guaranty insurance. Article 69 superseded Part 63 for all new financial guaranties. However, sections 6903(a)(2) and 6907(b) provide that certain reserve requirements that were applicable for municipal bond guaranties prior to the effective date of article 69 will continue to apply to all financial guaranties in force prior to the dates set forth in the respective sections. The specific reserve requirements that have to be met are different depending upon whether or not the insurer is currently organized and licensed as a financial guaranty insurance corporation pursuant to article 69.

(c) This Part sets forth the reserve requirements for financial guaranty insurance in force prior to the effective date of article 69 of the Insurance Law.