WILLIAM DONALD SCHAEFER, Governor

Ch. 507

(2) 8.0 PERCENT OF THE TOTAL PREMIUM RECEIVED BY THE
CORPORATION IN THE IMMEDIATELY PRECEDING CALENDAR YEAR.

(C) IF THE SIZE AND STRUCTURE OF THE CORPORATION REQUIRES, THE
COMMISSIONER SHALL HAVE THE AUTHORITY TO REQUIRE THE DIFFERENTIATION
OF THE CORPORATION'S ACTIVITIES INTO RISK AND NONRISK BUSINESS FOR THE
PURPOSE OF DETERMINING THE CORPORATION'S INCOME THAT IS DERIVED FROM
PREMIUM AND FROM OTHER SOURCES.

(C) (D) IF THE COMMISSIONER DETERMINES AFTER A HEARING THAT A
LARGER SURPLUS IS NECESSARY FOR THE PROTECTION OF SUBSCRIBERS UNDER A
NONPROFIT HEALTH SERVICE PLAN, THE COMMISSIONER MAY REQUIRE A
CORPORATION LICENSED UNDER THIS SUBTITLE TO MAINTAIN A SURPLUS IN AN
AMOUNT IN EXCESS OF THAT REQUIRED IN SUBSECTION (B) OF THIS SECTION.

(D) (E) (1) THE SURPLUS OF A CORPORATION LICENSED UNDER THIS
SUBTITLE MAY BE DEEMED TO BE EXCESSIVE ONLY IF:

(I)       THE SURPLUS IS GREATER THAN 30% OF THE TOTAL
PREMIUMS RECEIVED BY THE CORPORATION IN THE IMMEDIATELY PRECEDING
CALENDAR YEAR; AND

(II)     AFTER A HEARING, THE COMMISSIONER DETERMINES THAT
THE SURPLUS IS UNREASONABLY LARGE.

(2)      ONCE THE COMMISSIONER HAS DETERMINED THE SURPLUS OF A
CORPORATION LICENSED UNDER THIS SUBTITLE TO BE EXCESSIVE, THE
COMMISSIONER MAY:

(I)       ORDER THE CORPORATION TO SUBMIT A PLAN FOR
DISTRIBUTION OF THE EXCESS IN A FAIR AND EQUITABLE METHOD; OR

(II)     IF THE CORPORATION FAILS TO SUBMIT A PLAN WITHIN 60
DAYS, COMPILE A PLAN AND ORDER THE CORPORATION TO IMPLEMENT IT.

(3)      A DISTRIBUTION ORDERED UNDER PARAGRAPH (2) OF THIS
SUBSECTION MAY BE MADE ONLY TO SUBSCRIBERS WHO ARE COVERED BY THE
CORPORATION'S NONPROFIT HEALTH SERVICE PLAN AT THE TIME THE
DISTRIBUTION IS MADE.

(F) THE COMMISSIONER MAY NOT ORDER A DISTRIBUTION OR A PLAN FOR
DISTRIBUTION UNDER SUBSECTION (D)(2) OF THIS SECTION IF THE DISTRIBUTION
WOULD RENDER THE CORPORATION IMPAIRED OR INSOLVENT UNDER THE LAWS
OF ITS DOMICILIARY STATE OR IN ANY OTHER STATE IN WHICH THE CORPORATION
IS AUTHORIZED TO DO BUSINESS.

355B.

(A) IF THE MINIMUM SURPLUS REQUIRED TO BE MAINTAINED UNDER § 355A
OF THIS SUBTITLE BECOMES IMPAIRED, THE COMMISSIONER SHALL MAY AT ONCE
DETERMINE THE AMOUNT OF DEFICIENCY AND SERVE NOTICE UPON THE

- 2583 -