§431:5-103  Impairment of reciprocal's
surplus.



(a) (1)  A domestic reciprocal insurer's surplus
shall be deemed to be impaired if its qualified assets are at any time
insufficient to discharge its liabilities other than any liability on account
of funds contributed by the attorney or other parties, and insufficient to
maintain the surplus required for the classes of insurance it is authorized to
transact.



(2)  Upon such impairment of a reciprocal insurer's
surplus, its attorney shall forthwith levy an assessment upon subscribers made
subject to assessment by the terms of their policies for the amount needed to
make up the deficiency.



(3)  For the purposes of a determination of impairment
of a reciprocal under this section, surplus means the required surplus which
corresponds to the paid-up capital stock required of a stock insurer for
authority to transact a like class or classes of insurance.



(b)  The insurer shall be deemed insolvent and
shall be proceeded against as authorized by this code if:



(1)  The attorney fails to make the assessment within
thirty days after the commissioner orders the attorney to do so; or



(2)  The deficiency is not fully made up within sixty
days after the date the assessment was made.



(c)  If liquidation of such an insurer is ordered,
an assessment shall be levied upon the subscribers for such an amount, subject
to limits as provided by this code, as the commissioner determines to be
necessary to discharge all liabilities of the insurer, exclusive of any funds
contributed by the attorney, but including the reasonable cost of the
liquidation. [L 1987, c 347, pt of §2]