§ 35A-25 — Authorized control event

(a) An authorized control event means any of the following events: (1) The filing of an RBC Report by the insurer that indicates that the insurer's total adjusted capital is greater than or equal to its mandatory control level RBC, but less than its authorized control level RBC. (2) The notification by the Director to the insurer of an Adjusted RBC Report that indicates the event described in paragraph (1), provided the insurer does not challenge the Adjusted RBC Report under Section 35A-35. (3) The notification by the Director to the insurer that the Director has, after a hearing, rejected the insurer's challenge under Section 35A-35 to an Adjusted RBC Report that indicates the event described in paragraph (1). (4) The insurer's failure to respond to a Corrective Order in a manner satisfactory to the Director, provided the insurer does not challenge the Corrective Order under Section 35A-35. (5) The insurer's failure to respond to a challenged or modified Corrective Order in a manner satisfactory to the Director after the Director has, after a hearing, rejected the insurer's challenge under Section 35A-35 or modified the Corrective Order. (b) In the event of an authorized control level event, the Director shall take the actions required under Section 35A-20 regarding an insurer with respect to which a regulatory action level event has occurred or, if the Director deems it to be in the best interests of the insurer's policyholders and creditors and of the public, take the actions necessary to cause the insurer to be placed in receivership under Article XIII. In the event the Director determines that receivership is necessary, the authorized control level event shall be deemed sufficient grounds for the Director to take action under Article XIII, and the Director shall have the rights, powers, and duties with respect to the insurer that are set forth in Article XIII. In the event the Director takes action under this subsection regarding an Adjusted RBC Report, the insurer shall be entitled to the protections afforded insurers under Article XIII.

Legislative History

(Source: P.A. 88-364.)