Impairment of capital, surplus or assets: Notice; time to cure; restrictions.
1. If at any time the amount of assets of a domestic stock or mutual insurer are less than the sum of its liabilities plus its paid-in capital stock and minimum surplus required to be maintained (in the case of a stock insurer), or the minimum surplus required to be maintained (in the case of a mutual insurer), under this Code for authority to transact the kinds of insurance being transacted, the Commissioner shall at once determine the amount of the deficiency and give written notice to the insurer of the amount of impairment and require that the impairment be cured and proof thereof filed with him within such period, not less than 30 days nor more than 90 days from date of the notice, as he may designate.
2. If the impairment of assets is 10 percent or less of the combined required paid-in capital stock and surplus (as to a stock insurer) or surplus (as to a mutual insurer), and the Commissioner believes that the impairment might be made good by an extension of time, he may extend the time within which the impairment may be cured by not to exceed an additional 90 days.
3. The Commissioner shall require such restriction of, or arrangements as to, operations of the insurer while the impairment exists as he deems advisable for the protection of policyholders, the insurer or the public.
Last modified: February 27, 2006