Ch. 36

1995 LAWS OF MARYLAND

SUBTITLE 4. ACQUISITION OF CONTROL OF INSURER.

7-401. ACQUISITIONS SUBJECT TO SUBTITLE.

EXCEPT AS PROVIDED IN § 7-402 OF THIS SUBTITLE, THIS SUBTITLE APPLIES TO
ANY ACQUISITION, AGREEMENT, ARRANGEMENT, OR ACTIVITY, INCLUDING THE
ACQUISITION OF VOTING SECURITIES OR ASSETS, BULK REINSURANCE, AND
MERGER, THAT RESULTS IN A PERSON ACQUIRING DIRECTLY OR INDIRECTLY THE
CONTROL OF AN AUTHORIZED INSURER. .

REVISOR'S NOTE: This section is new language derived without substantive
change from former Art. 48A, § 494A(a)(2) and (b)(1)..

Former Art. 48A, § 494A(a)(2) defined "acquisition" as an "agreement,
arrangement, or activity the consummation of which results in a person
acquiring ... the control of another person ...". The definition served only to
delimit the scope of this subtitle. It is revised to clarify that function.

The former phrase "but is not limited to", which modified "includes", is
deleted as unnecessary. See Art. 1, § 30.

Former Art. 48A, § 494A(a)(l), which provided introductory language to a
definition section, is deleted as unnecessary because there are no definitions
in this subtitle.

Defined terms: "Authorized insurer" § 1-101
"Control" § 1-101
"Person" § 1-101
"Reinsurance" § 1-101

7-402. TRANSACTIONS EXCLUDED FROM SUBTITLE.

THIS SUBTITLE DOES NOT APPLY TO:                                                     

(1)      AN ACQUISITION THAT IS SUBJECT TO THE APPROVAL OR
DISAPPROVAL OF THE COMMISSIONER UNDER SUBTITLE 3 OF THIS TITLE;

(2)      A PURCHASE OF SECURITIES SOLELY FOR INVESTMENT PURPOSES IF
THE SECURITIES ARE NOT USED FOR VOTING OR OTHERWISE TO CAUSE, OR
ATTEMPT TO CAUSE, THE SUBSTANTIAL LESSENING OF COMPETITION IN ANY
INSURANCE MARKET IN THE STATE;

(3)      A PURCHASE OF SECURITIES THAT RESULTS IN A PRESUMPTION OF
CONTROL UNDER § 7-104 OF THIS TITLE, BUT THE COMMISSIONER OF THE INSURER'S
STATE OF DOMICILE:

(I)       ACCEPTS A DISCLAIMER OF CONTROL OR AFFIRMATIVELY
FINDS THAT CONTROL DOES NOT EXIST; AND

(II)     INFORMS THE COMMISSIONER OF THE DISCLAIMER OR
FINDING;

(4)      AN ACQUISITION:

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