§ 23-73-112 — Qualifications for certificate of authority

Arkansas § 23-73-112

• Jurisdiction: Arkansas
• Title: 23

Text

To qualify for and hold a certificate of authority to insure property or issue policies, the company or association shall: (1) (A) (i) Have at least two hundred fifty (250) members who hold policies or certificates upon at least two hundred fifty (250) separate risks. (ii) An association or company whose membership falls below two hundred fifty (250) members shall notify the Insurance Commissioner immediately and shall have ninety (90) days from that date to bring its membership level back up to the requisite number of two hundred fifty (250) members. (iii) If an association or company fails to restore the membership level to two hundred fifty (250) members within the prescribed ninety-day period, the commissioner may: (a) Direct the association or company to follow a course of action that will protect the assets of the association and allow for continued protection of the members; or (b) Place the association or company into involuntary dissolution as contained in § 23-73-120 . (B) (i) If immediate initial compliance with subdivision (1)(A) of this section would cause a domestic association or company to be ineligible for a continued certificate of authority to operate in this state on April 11, 2005, the commissioner may allow that domestic association or company to augment its membership in increments in order for it to achieve compliance with the minimum requirements by no later than December 31, 2006. (ii) For good cause shown in writing by an association or company, including planned action steps to achieve the minimum membership, the commissioner may grant one (1) or more extensions of the deadline set for compliance in subdivision (1)(B)(i) of this section for a period or periods not to exceed one (1) year; (2) (A) Maintain contracts or treaties of reinsurance as necessary based on its risk and surplus level with insurance companies, excluding surplus lines insurers, licensed or otherwise registered to conduct that business in the State of Arkansas. (B) Indemnity reinsurance contracts or treaties shall be structured to provide protection to the company or association against a reduction of the surplus to an extent that the reduction: (i) Endangers the solvency of the company or association; or (ii) Hinders the company's or association's ability to pay claims made by policyholders; and (3) Fully comply with and qualify according to the other provisions of this chapter.

Legislative History

Acts 1959, No. 148, § 589; A.S.A. 1947, § 66-4611; Acts 1997, No. 774, § 1; 2005, No. 2004, § 2; 2007, No. 76, § 2.