Ch. 36                                      1995 LAWS OF MARYLAND

(1)     A DOMESTIC INSURER AND ANOTHER MEMBER OF THE SAME
INSURANCE HOLDING COMPANY SYSTEM MAY NOT ENTER INTO A TRANSACTION
THAT IS PART OF A PLAN OR SERIES OF LIKE TRANSACTIONS IF THE PURPOSE OF
MAKING SEPARATE TRANSACTIONS IS TO AVOID EXCEEDING LIMITATIONS UNDER
THIS SECTION AND THE REVIEW OF THE TRANSACTION THAT OTHERWISE WOULD
OCCUR.

(2)     IF THE COMMISSIONER DETERMINES THAT SEPARATE
TRANSACTIONS WERE ENTERED INTO DURING ANY 12-MONTH PERIOD IN
VIOLATION OF PARAGRAPH (1) OF THIS SUBSECTION, THE COMMISSIONER MAY
IMPOSE ANY SANCTION AUTHORIZED BY §§ 7-802, 7-803, 7-805, AND 7-807 OF THIS
TITLE.

REVISOR'S NOTE: This section is new language derived without substantive
change from former Art. 48A, §§ 492(h), 495(l), and 496(c) through (e).

In subsection (d) of this section, the reference to the "notice period under
subsection (c) of this section" is substituted for the former reference to "such
period" for clarity.

In subsection (e)(1)(ii) and (2)(ii)2 of this section, the reference to an insurer
"other than a life insurer" is substituted for the former reference to a
"nonlife" insurer for clarity.

In the introductory language of subsection (e)(3) of this section, the reference
to a "person that is not its. affiliate" is substituted for the former term
"nonaffiliate" for clarity and consistency.

Subsection (g) of this section is revised to apply to "material transactions" as
defined under former Art. 48A, § 496(c), which is revised as subsection (a) of
this section. Since former Art. 48A, § 495 was limited to registration
requirements, it appeared that former § 495(1) was inappropriately placed in §
495.

As to subsection (g)(1) of this section, the Insurance Article Review
Committee notes, for the consideration of the General Assembly, that former
Art. 48A, § 495(1) provided that a "material transaction ... found to be not in
conformity with this section shall constitute a violation of this subtitle".
However, only persons that violate this title are subject to sanctions. The
General Assembly may wish to clarify that it is the person who makes the
transaction — not the transaction itself — that is subject to sanctions under
this title.

In subsection (g)(2) of this section, the term "sanctions" is substituted for the
former term "penalties" for clarity and consistency. Similarly, in subsection
(h)(2) of this section, the term "sanction" is substituted for the former
reference to "exercis[ing] ... authority under § 500" for clarity and consistency.

In subsection (h)(1) of this section, the reference to limitations "under this
section" is substituted for the former reference to "the statutory threshold
amount" for clarity.

- 1060 -