WILLIAM DONALD SCHAEFER, Governor

Ch. 551

(II)     RELEASED A FALSE OR MISLEADING FINANCIAL STATEMENT
TO LENDING INSTITUTIONS OR TO THE GENERAL PUBLIC;

(III)    MADE A FALSE OR MISLEADING ENTRY; OR

(IV)    OMITTED AN ENTRY OF MATERIAL AMOUNT IN THE BOOKS OF
THE INSURER;

(14)    WHETHER THE INSURER HAS GROWN SO RAPIDLY AND TO THE
EXTENT THAT IT LACKS ADEQUATE FINANCIAL AND ADMINISTRATIVE CAPACITY
TO MEET ITS OBLIGATIONS IN A TIMELY MANNER; OR

(15)    WHETHER THE INSURER HAS EXPERIENCED OR WILL EXPERIENCE
IN THE FORESEEABLE FUTURE ANY CASH FLOW OR LIQUIDITY PROBLEMS.

(B) FOR THE PURPOSES OF MAKING A DETERMINATION OF WHETHER THE
FINANCIAL CONDITION OF AN INSURER WOULD CAUSE THE CONTINUED
OPERATION OR THE INSURER OF THE INSURER TO BE HAZARDOUS TO THE
POLICYHOLDERS, CREDITORS, OR THE GENERAL PUBLIC UNDER THIS SUBTITLE,
THE COMMISSIONER MAY:

(1)      DISREGARD ANY CREDIT OR AMOUNT RECEIVABLE RESULTING
FROM TRANSACTIONS WITH A REINSURER WHICH IS INSOLVENT, IMPAIRED, OR
OTHERWISE SUBJECT TO A DELINQUENCY PROCEEDING;

(2)      MAKE APPROPRIATE ADJUSTMENTS TO ASSET VALUES
ATTRIBUTABLE TO INVESTMENTS IN OR TRANSACTIONS WITH PARENTS,
SUBSIDIARIES, OR AFFILIATES OF THE INSURER;

(3)      REFUSE TO RECOGNIZE THE STATED VALUE OF ACCOUNTS
RECEIVABLE IF THE ABILITY TO COLLECT THE RECEIVABLES IS HIGHLY
SPECULATIVE BECAUSE OF THE AGE OF THE ACCOUNT OR THE FINANCIAL
CONDITION OF THE DEBTOR; OR

(4)      INCREASE THE INSURER'S LIABILITY IN AN AMOUNT EQUAL TO ANY
CONTINGENT LIABILITY, PLEDGE, OR GUARANTEE NOT OTHERWISE INCLUDED IN
THE STATEMENT OF LIABILITY IF THERE IS A SUBSTANTIAL RISK THAT THE
INSURER WILL BE CALLED UPON TO MEET THE OBLIGATION UNDERTAKEN WITHIN
THE NEXT 12-MONTH PERIOD.

131C.

(A) IF THE COMMISSIONER DETERMINES THAT THE CONTINUED OPERATION
OF AN AUTHORIZED INSURER MAY BE HAZARDOUS TO THE POLICYHOLDERS,
CREDITORS, OR THE GENERAL PUBLIC, THEN THE COMMISSIONER MAY ISSUE AN
ORDER REQUIRING THE INSURER TO:

(1)      REDUCE THE TOTAL AMOUNT OF THE INSURER'S PRESENT AND
POTENTIAL LIABILITY FOR POLICY BENEFITS THROUGH THE USE OF REINSURANCE:

(2)      REDUCE, SUSPEND, OR LIMIT THE VOLUME OF BUSINESS BEING
ACCEPTED OR RENEWED;

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