State Codes and Statutes

Statutes > Vermont > Title-08 > Chapter-159 > 8303

§ 8303. Company action level event

(a) A risk based capital report or final adjusted risk based capital report which indicates:

(1) that the insurer's total adjusted capital is greater than or equal to its regulatory action level risk based capital but less than its company action level risk based capital; or

(2) that the insurer has total adjusted capital which is greater than or equal to its company action level risk based capital, but less than the product of its authorized control level risk based capital and 2.5 and has experienced a negative trend shall be considered a company action level event and subject to the requirements of this section.

(b) An insurer shall prepare and submit to the commissioner a risk based capital plan within 45 days of filing a risk based capital report or within 45 days of a final adjusted risk based capital report showing a company action level event. The risk based capital plan shall be a comprehensive financial plan and shall:

(1) identify the conditions in the insurer which contribute to the company action level event;

(2) contain proposals of corrective actions which the insurer intends to take that would result in the elimination of the company action level event;

(3) provide comparative projections of the insurer's statutory operating income, net income, capital and surplus for the current year and at least the four succeeding years showing both the effect and the absence of the proposed corrective actions. The projections should include separate projections for each major line of business for both new and renewal business and should separately identify each significant income, expense and benefit component;

(4) identify the key assumptions impacting the insurer's projections and the sensitivity of the projections to the assumptions; and

(5) identify the quality of, and problems associated with, the insurer's business, including, but not limited to, its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance.

(c) The commissioner shall notify the insurer whether the proposed risk based capital plan is approved within 60 days of its submission. If the commissioner disapproves the plan, the notice shall set forth the reasons for the disapproval and may notify the insurer of revisions which will render the risk based capital plan satisfactory to the commissioner. Upon notice that a proposed plan is disapproved, the insurer shall prepare and submit a revised risk based capital plan within 45 days of the commissioner's notice of disapproval or, if the commissioner's notice of disapproval is appealed under section 8307 of this title, within 45 days of a commissioner's determination adverse to the insurer.

(d) In the event of a notification by the commissioner to an insurer that the insurer's risk based capital plan or revised risk based capital plan is unsatisfactory, the commissioner may at the commissioner's discretion, subject to the insurer's right to a hearing under section 8307 of this title, specify in the notification that the notification constitutes a regulatory action level event.

(e) Each domestic insurer required to file a risk based capital plan or revised risk based capital plan under this section shall file a copy of the plan with the insurance commissioner in any state in which the insurer is authorized to do business if:

(1) such state has a provision that is substantially similar to section 8308 of this title; and

(2) the insurance commissioner of that state has notified the insurer of its request for the filing in writing. Plans required to be filed under this subdivision shall be filed no later than the later of:

(A) 15 days after notice to file a copy of its risk based capital plan or revised risk based capital plan with the state; or

(B) the date on which the risk based capital plan or revised risk based capital plan is required to be filed under section 8304 of this title. (Added 1993, No. 235 (Adj. Sess.), § 8, eff. June 21, 1994.)

State Codes and Statutes

Statutes > Vermont > Title-08 > Chapter-159 > 8303

§ 8303. Company action level event

(a) A risk based capital report or final adjusted risk based capital report which indicates:

(1) that the insurer's total adjusted capital is greater than or equal to its regulatory action level risk based capital but less than its company action level risk based capital; or

(2) that the insurer has total adjusted capital which is greater than or equal to its company action level risk based capital, but less than the product of its authorized control level risk based capital and 2.5 and has experienced a negative trend shall be considered a company action level event and subject to the requirements of this section.

(b) An insurer shall prepare and submit to the commissioner a risk based capital plan within 45 days of filing a risk based capital report or within 45 days of a final adjusted risk based capital report showing a company action level event. The risk based capital plan shall be a comprehensive financial plan and shall:

(1) identify the conditions in the insurer which contribute to the company action level event;

(2) contain proposals of corrective actions which the insurer intends to take that would result in the elimination of the company action level event;

(3) provide comparative projections of the insurer's statutory operating income, net income, capital and surplus for the current year and at least the four succeeding years showing both the effect and the absence of the proposed corrective actions. The projections should include separate projections for each major line of business for both new and renewal business and should separately identify each significant income, expense and benefit component;

(4) identify the key assumptions impacting the insurer's projections and the sensitivity of the projections to the assumptions; and

(5) identify the quality of, and problems associated with, the insurer's business, including, but not limited to, its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance.

(c) The commissioner shall notify the insurer whether the proposed risk based capital plan is approved within 60 days of its submission. If the commissioner disapproves the plan, the notice shall set forth the reasons for the disapproval and may notify the insurer of revisions which will render the risk based capital plan satisfactory to the commissioner. Upon notice that a proposed plan is disapproved, the insurer shall prepare and submit a revised risk based capital plan within 45 days of the commissioner's notice of disapproval or, if the commissioner's notice of disapproval is appealed under section 8307 of this title, within 45 days of a commissioner's determination adverse to the insurer.

(d) In the event of a notification by the commissioner to an insurer that the insurer's risk based capital plan or revised risk based capital plan is unsatisfactory, the commissioner may at the commissioner's discretion, subject to the insurer's right to a hearing under section 8307 of this title, specify in the notification that the notification constitutes a regulatory action level event.

(e) Each domestic insurer required to file a risk based capital plan or revised risk based capital plan under this section shall file a copy of the plan with the insurance commissioner in any state in which the insurer is authorized to do business if:

(1) such state has a provision that is substantially similar to section 8308 of this title; and

(2) the insurance commissioner of that state has notified the insurer of its request for the filing in writing. Plans required to be filed under this subdivision shall be filed no later than the later of:

(A) 15 days after notice to file a copy of its risk based capital plan or revised risk based capital plan with the state; or

(B) the date on which the risk based capital plan or revised risk based capital plan is required to be filed under section 8304 of this title. (Added 1993, No. 235 (Adj. Sess.), § 8, eff. June 21, 1994.)


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State Codes and Statutes

Statutes > Vermont > Title-08 > Chapter-159 > 8303

§ 8303. Company action level event

(a) A risk based capital report or final adjusted risk based capital report which indicates:

(1) that the insurer's total adjusted capital is greater than or equal to its regulatory action level risk based capital but less than its company action level risk based capital; or

(2) that the insurer has total adjusted capital which is greater than or equal to its company action level risk based capital, but less than the product of its authorized control level risk based capital and 2.5 and has experienced a negative trend shall be considered a company action level event and subject to the requirements of this section.

(b) An insurer shall prepare and submit to the commissioner a risk based capital plan within 45 days of filing a risk based capital report or within 45 days of a final adjusted risk based capital report showing a company action level event. The risk based capital plan shall be a comprehensive financial plan and shall:

(1) identify the conditions in the insurer which contribute to the company action level event;

(2) contain proposals of corrective actions which the insurer intends to take that would result in the elimination of the company action level event;

(3) provide comparative projections of the insurer's statutory operating income, net income, capital and surplus for the current year and at least the four succeeding years showing both the effect and the absence of the proposed corrective actions. The projections should include separate projections for each major line of business for both new and renewal business and should separately identify each significant income, expense and benefit component;

(4) identify the key assumptions impacting the insurer's projections and the sensitivity of the projections to the assumptions; and

(5) identify the quality of, and problems associated with, the insurer's business, including, but not limited to, its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance.

(c) The commissioner shall notify the insurer whether the proposed risk based capital plan is approved within 60 days of its submission. If the commissioner disapproves the plan, the notice shall set forth the reasons for the disapproval and may notify the insurer of revisions which will render the risk based capital plan satisfactory to the commissioner. Upon notice that a proposed plan is disapproved, the insurer shall prepare and submit a revised risk based capital plan within 45 days of the commissioner's notice of disapproval or, if the commissioner's notice of disapproval is appealed under section 8307 of this title, within 45 days of a commissioner's determination adverse to the insurer.

(d) In the event of a notification by the commissioner to an insurer that the insurer's risk based capital plan or revised risk based capital plan is unsatisfactory, the commissioner may at the commissioner's discretion, subject to the insurer's right to a hearing under section 8307 of this title, specify in the notification that the notification constitutes a regulatory action level event.

(e) Each domestic insurer required to file a risk based capital plan or revised risk based capital plan under this section shall file a copy of the plan with the insurance commissioner in any state in which the insurer is authorized to do business if:

(1) such state has a provision that is substantially similar to section 8308 of this title; and

(2) the insurance commissioner of that state has notified the insurer of its request for the filing in writing. Plans required to be filed under this subdivision shall be filed no later than the later of:

(A) 15 days after notice to file a copy of its risk based capital plan or revised risk based capital plan with the state; or

(B) the date on which the risk based capital plan or revised risk based capital plan is required to be filed under section 8304 of this title. (Added 1993, No. 235 (Adj. Sess.), § 8, eff. June 21, 1994.)


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