§ 26.1-03.2-04 — Regulatory action level event

North Dakota § 26.1-03.2-04

• Jurisdiction: North Dakota
• Title 26.1: Insurance
• Ch. 26.1-03.2: Risk-Based Capital for Health Organizations

Text

1. "Regulatory action level event" means, with respect to a health organization, any of the
following events:
a. The filing of a risk-based capital report by the health organization which indicates
that the health organization's total adjusted capital is greater than or equal to its
authorized control level risk-based capital but less than its regulatory action level
risk-based capital;
b. Notification by the commissioner to a health organization of an adjusted
risk-based capital report that indicates the event in subdivision a, provided the
health organization does not challenge the adjusted risk-based capital report
under section 26.1-03.2-07;
c. If, pursuant to section 26.1-03.2-07, the health organization challenges an
adjusted risk-based capital report that indicates the event in subdivision a, the
notification by the commissioner to the health organization that the commissioner,
after a hearing, has rejected the health organization's challenge;
d. The failure of the health organization to file a risk-based capital report by the filing
date, unless the health organization has provided an explanation for the failure
which is satisfactory to the commissioner and has cured the failure within ten
days after the filing date;
e. The failure of the health organization to submit a risk-based capital plan to the
commissioner within the time period set forth in subsection 3 of section
26.1-03.2-03;
f. Notification by the commissioner to the health organization that:
(1) The risk-based capital plan or revised risk-based capital plan submitted by
the health organization is, in the judgment of the commissioner,
unsatisfactory; and
(2) Notification constitutes a regulatory action level event with respect to the
health organization, provided the health organization has not challenged the
determination under section 26.1-03.2-07;
g. If, pursuant to section 26.1-03.2-07, the health organization challenges a
determination by the commissioner under subdivision f, the notification by the
commissioner to the health organization that the commissioner, after a hearing,
has rejected the challenge;
h. Notification by the commissioner to the health organization that the health
organization has failed to adhere to its risk-based capital plan or revised
risk-based capital plan, but only if the failure has a substantial adverse effect on
the ability of the health organization to eliminate the company action level event
in accordance with its risk-based capital plan or revised risk-based capital plan
and the commissioner has so stated in the notification, provided the health
organization has not challenged the determination under section 26.1-03.2-07; or
i. If, pursuant to section 26.1-03.2-07, the health organization challenges a
determination by the commissioner under subdivision h, the notification by the
commissioner to the health organization that the commissioner, after a hearing,
has rejected the challenge.
2. In the event of a regulatory action level event the commissioner shall:
a. Require the health organization to prepare and submit a risk-based capital plan
or, if applicable, a revised risk-based capital plan;
b. Perform such examination or analysis as the commissioner deems necessary of
the assets, liabilities, and operations of the health organization, including a review
of its risk-based capital plan or revised risk-based capital plan; and
c. Subsequent to the examination or analysis, issue an order specifying such
corrective actions as the commissioner determines are required.

3. In determining corrective actions, the commissioner may take into account factors the
commissioner deems relevant with respect to the health organization risk based upon
the commissioner's examination or analysis of the assets, liabilities, and operations of
the health organization, including the results of any sensitivity tests undertaken
pursuant to the risk-based capital instructions. The risk-based capital plan or revised
risk-based capital plan must be submitted:
a. Within forty-five days after the occurrence of the regulatory action level event;
b. If the health organization challenges an adjusted risk-based capital report
pursuant to section 26.1-03.2-07 and the challenge is not frivolous in the
judgment of the commissioner, within forty-five days after the notification to the
health organization that the commissioner has, after a hearing, rejected the
health organization's challenge; or
c. If the health organization challenges a revised risk-based capital plan pursuant to
section 26.1-03.2-07 and the challenge is not frivolous in the judgment of the
commissioner, within forty-five days after the notification to the health
organization that the commissioner has, after a hearing, rejected the health
organization's challenge.
4. The commissioner may retain actuaries and investment experts and other consultants
as may be necessary in the judgment of the commissioner to review the health
organization's risk-based capital plan or revised risk-based capital plan, examine or
analyze the assets, liabilities, and operations, including contractual relationships, of
the health organization and formulate the corrective order with respect to the health
organization. The fees, costs, and expenses relating to consultants must be borne by
the affected health organization or such other party as directed by the commissioner.