LX Insurance Exchange maintains full compliance with applicable federal and state securities laws, insurance regulations, and anti-money laundering requirements.
All tokenized assets held as reinsurance collateral are maintained in qualified trust accounts established under New York Insurance Law Section 1307 or equivalent state statutes. Trust agreements are reviewed by independent legal counsel and approved by applicable state insurance departments.
Physical assets underlying tokenized instruments are held by qualified custodians meeting NAIC custodial agreement requirements. Custodians maintain segregated accounts, provide regular reporting, and are subject to annual audit requirements.
Trust account beneficiaries (ceding insurers) retain priority rights to trust assets in the event of reinsurer insolvency. Trust agreements include provisions for automatic replenishment, substitution of assets, and withdrawal procedures consistent with NAIC model trust agreement requirements.
Monthly trust account statements are provided to all beneficiaries. Annual independent audits verify asset values and trust compliance. The LX Insurance Exchange platform provides real-time visibility into trust account composition and valuations.
Legal Disclaimer: This compliance documentation is provided for informational purposes only and does not constitute legal advice. LX Insurance Exchange recommends that all participants consult with qualified legal counsel regarding applicable regulatory requirements. Compliance requirements vary by jurisdiction and are subject to change.