Arizona Laws 20-488.03. Regulatory action level event
A. If a regulatory action level event occurs, the director shall:
Terms Used In Arizona Laws 20-488.03
- Action: includes any matter or proceeding in a court, civil or criminal. See Arizona Laws 1-215
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Corrective order: means an order that is issued by the director and that specifies corrective actions that the director has determined are required. See Arizona Laws 20-488
- including: means not limited to and is not a term of exclusion. See Arizona Laws 1-215
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- RBC: means risk-based capital. See Arizona Laws 20-488
- RBC instructions: means the RBC report, including risk-based capital instructions adopted by the national association of insurance commissioners. See Arizona Laws 20-488
- RBC plan: means a comprehensive financial plan containing the elements specified in Section 20-488. See Arizona Laws 20-488
- RBC report: means the report required under Section 20-488. See Arizona Laws 20-488
- Regulatory action level event: means , with respect to any insurer, any of the following events:
(a) The filing of an RBC report by the insurer indicating that the insurer's total adjusted capital is more than or equal to its authorized control level RBC but less than its regulatory action level RBC. See Arizona Laws 20-488
1. Require the insurer to submit an RBC plan or, if applicable, a revised RBC plan.
2. Perform an examination or analysis, as the director deems necessary, of the assets, liabilities and operations of the insurer, including a review of the insurer’s RBC plan or revised RBC plan.
3. After conducting the examination or analysis, issue a corrective order specifying any corrective actions that the director determines are required.
B. In determining what corrective actions may be required, the director may consider any factors that the director deems relevant with respect to the insurer based on the director’s examination or analysis of the insurer’s assets, liabilities and operations, including but not limited to the results of any sensitivity tests undertaken pursuant to the RBC instructions. The RBC plan or revised RBC plan shall be submitted within one of the following:
1. Forty-five days after the regulatory action level event occurs.
2. If the insurer challenges an adjusted RBC report pursuant to Section 20-488.06 and the director does not consider the challenge to be frivolous, forty-five days after the insurer is notified that the director, after a hearing, has rejected the insurer’s challenge.
3. If the insurer challenges a revised RBC plan pursuant to Section 20-488.06, forty-five days after the insurer is notified that the director, after a hearing, has rejected the insurer’s challenge.
C. The director may retain actuaries, investment experts and other consultants to review the insurer’s RBC plan or revised RBC plan, to examine or analyze the assets, liabilities and operations of the insurer and to formulate the corrective order with respect to the insurer. The affected insurer or another party if ordered by the director shall pay the fees, costs and other expenses relating to any retained consultants.