TITLE 27

Insurance

CHAPTER 27-4.6

Risk-Based Capital (RBC) for Insurers Act

SECTION 27-4.6-4



   § 27-4.6-4  Regulatory action level event.

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(a) "Regulatory action level event" means, with respect to any insurer, any of

the following events:



   (1) The filing of an RBC report by the insurer which

indicates that the insurer's total adjusted capital is greater than or equal to

its authorized control level RBC but less than its regulatory action level RBC;



   (2) The notification by the commissioner to an insurer of an

adjusted RBC report that indicates the event in subdivision (a)(1), provided

the insurer does not challenge the adjusted RBC report under § 27-4.6-7;



   (3) If, pursuant to § 27-4.6-7, the insurer challenges

an adjusted RBC report that indicates the event in subdivision (a)(1), the

notification by the commissioner to the insurer that the commissioner has,

after a hearing, rejected the insurer's challenge;



   (4) The failure of the insurer to file an RBC report by the

filing date, unless the insurer has provided an explanation for that failure

which is satisfactory to the commissioner and has cured the failure within ten

(10) days after the filing date;



   (5) The failure of the insurer to submit an RBC plan to the

commissioner within the time period set forth in § 27-4.6-3(c);



   (6) Notification by the commissioner to the insurer that:



   (i) The RBC plan or revised RBC plan submitted by the insurer

is, in the judgment of the commissioner, unsatisfactory; and



   (ii) The notification constitutes a regulatory action level

event with respect to the insurer, provided the insurer has not challenged the

determination under § 27-4.6-7;



   (7) If, pursuant to § 27-4.6-7, the insurer challenges a

determination by the commissioner under subdivision (a)(6), the notification by

the commissioner to the insurer that the commissioner has, after a hearing,

rejected those challenges;



   (8) Notification by the commissioner to the insurer that the

insurer has failed to adhere to its RBC plan or revised RBC plan, but only if

that failure has a substantial adverse effect on the ability of the insurer to

eliminate the company action level event in accordance with its RBC plan or

revised RBC plan and the commissioner has stated this in the notification,

provided the insurer has not challenged the determination under §

27-4.6-7; or



   (9) If, pursuant to § 27-4.6-7, the insurer challenges a

determination by the commissioner under subdivision (a)(8), the notification by

the commissioner to the insurer that the commissioner has, after a hearing,

rejected the challenge.



   (b) In the event of a regulatory action level event the

commissioner shall:



   (1) Require the insurer to prepare and submit an RBC plan or,

if applicable, a revised RBC plan;



   (2) Perform any examination or analysis as the commissioner

deems necessary of the assets, liabilities and operations of the insurer

including a review of its RBC plan or revised RBC plan; and



   (3) Subsequent to the examination or analysis, issue an order

specifying any corrective actions as the commissioner shall determine are

required (a "corrective order").



   (c) In determining corrective actions, the commissioner may

take into account any factors as are deemed relevant with respect to the

insurer based upon the commissioner's examination or analysis of the assets,

liabilities and operations of the insurer, including, but not limited to, the

results of any sensitivity tests undertaken pursuant to the RBC instructions.

The RBC plan or Revised RBC plan shall be submitted:



   (1) Within forty-five (45) days after the occurrence of the

regulatory action level event;



   (2) If the insurer challenges an adjusted RBC report pursuant

to § 27-4.6-7 and the challenge is not frivolous in the judgment of the

commissioner, within forty-five (45) days after the notification to the insurer

that the commissioner has, after a hearing, rejected the insurer's challenge; or



   (3) If the insurer challenges a revised RBC plan pursuant to

§ 27-4.6-7 and the challenge is not frivolous in the judgment of the

commissioner, within forty-five (45) days after the notification to the insurer

that the commissioner has, after a hearing, rejected the insurer's challenge.



   (d) The commissioner may retain actuaries and investment

experts and other consultants necessary in the judgment of the commissioner to

review the insurer's RBC plan or revised RBC plan, examine or analyze the

assets, liabilities and operations of the insurer and formulate the corrective

order with respect to the insurer. The fees, costs and expenses relating to

consultants shall be borne by the affected insurer or any other party as

directed by the commissioner.



History of Section.

(P.L. 1996, ch. 187, § 2.)