Montana Code 33-2-1904. Company action level event
33-2-1904. Company action level event. (1) “Company action level event” means any of the following events:
Terms Used In Montana Code 33-2-1904
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Domestic insurer: means any insurance company or health organization domiciled in this state. See Montana Code 33-2-1902
- Health organization: means a health maintenance organization or other managed care organization licensed under Title 33, chapter 31. See Montana Code 33-2-1902
- Insurer: includes life or other disability insurers, property and casualty insurers, and health organizations. See Montana Code 33-2-1902
- Life or disability insurer: means :
(a)any insurance company licensed under 33-2-116 and engaged in the business of entering into contracts of disability insurance, as described in 33-1-207, or life insurance, as described in 33-1-208;
(b)a licensed property and casualty insurer writing only disability insurance;
(c)any insurer engaged solely in the business of reinsurance of life or disability contracts;
(d)a fraternal benefit society formed under Title 33, chapter 7; or
(e)a health service corporation formed under Title 33, chapter 30. See Montana Code 33-2-1902
- Negative trend: means , with respect to a life or health insurer, a negative trend over a period of time, as determined in accordance with the trend test calculation included in the RBC instructions. See Montana Code 33-2-1902
- Property and casualty insurer: means :
(i)any insurance company licensed under 33-2-116 and engaged in the business of entering into contracts of property insurance, as described in 33-1-210, or casualty insurance, as described in 33-1-206;
(ii)any insurance company engaged solely in the business of reinsurance of property and casualty contracts; or
(iii)any insurance company engaged in the business of surety and marine insurance. See Montana Code 33-2-1902
- RBC instructions: means the RBC report, including risk-based capital instructions adopted by the NAIC, as the RBC instructions may be amended by the NAIC from time to time in accordance with the procedures adopted by the NAIC. See Montana Code 33-2-1902
- RBC plan: means a comprehensive financial plan containing the elements specified in 33-2-1904(2). See Montana Code 33-2-1902
- RBC report: means the report required in 33-2-1903. See Montana Code 33-2-1902
- regulatory action level RBC: means , except for the state fund as provided in subsection (12)(d)(ii), the product of 1. See Montana Code 33-2-1902
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
- Total adjusted capital: means the sum of:
(a)an insurer's statutory capital and surplus; and
(b)other items, if any, as the RBC instructions may provide. See Montana Code 33-2-1902
- Writing: includes printing. See Montana Code 1-1-203
(a)the filing of an RBC report by an insurer indicating that:
(i)the insurer’s total adjusted capital is greater than or equal to its regulatory action level RBC but less than its company action level RBC;
(ii)for a life or disability insurer, the insurer has total adjusted capital that:
(A)is greater than or equal to its company action level RBC but less than its authorized control level RBC multiplied by 3; and
(B)has a negative trend;
(iii)for a property and casualty insurer, the insurer has total adjusted capital that:
(A)is greater than or equal to its company action level RBC but less than its authorized control level RBC multiplied by 3; and
(B)triggers the trend test determined in accordance with the trend test calculation included in the RBC instructions; or
(iv)for a health organization, the insurer has total adjusted capital that:
(A)is greater than or equal to its company action level RBC but less than its authorized control level RBC multiplied by 3; and
(B)triggers the trend test determined in accordance with the trend test calculation included in the health RBC instructions;
(b)the notification by the commissioner to the insurer of an adjusted RBC report that indicates an event in subsection (1)(a) if the insurer does not challenge the adjusted RBC report under 33-2-1908 or if the commissioner has rejected the insurer’s challenge.
(2)In the event of a company action level event, the insurer shall prepare and submit to the commissioner an RBC plan that must:
(a)identify the conditions that contribute to the company action level event;
(b)contain proposals of corrective actions that the insurer intends to take and that would be expected to result in the elimination of the company action level event;
(c)provide projections of the insurer’s financial results in the current year and at least the next 4 years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory operating income, net income, capital, and surplus. The projections for both new and renewal business may include separate projections for each major line of business and separately identify each significant income, expense, and benefit component.
(d)identify the key assumptions impacting the insurer’s projections and the sensitivity of the projections to the assumptions; and
(e)identify the quality of and problems associated with the insurer’s business, including but not limited to its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business, and use of reinsurance, if any, in each case.
(3)The RBC plan must be submitted:
(a)within 45 days of the company action level event; or
(b)if the insurer challenges an adjusted RBC report pursuant to 33-2-1908, within 45 days after notification to the insurer that the commissioner has, after a hearing, rejected the insurer’s challenge.
(4)Within 60 days after an insurer submits an RBC plan to the commissioner, the commissioner shall notify the insurer as to whether the RBC plan may be implemented or is unsatisfactory in the judgment of the commissioner. If the commissioner determines that the RBC plan is unsatisfactory, the notification to the insurer must set forth the reasons for the determination and may propose revisions intended to render the RBC plan satisfactory in the judgment of the commissioner. Upon notification from the commissioner, the insurer shall prepare a revised RBC plan, which may incorporate by reference any revisions proposed by the commissioner, and shall submit the revised RBC plan to the commissioner:
(a)within 45 days after the notification from the commissioner; or
(b)if the insurer challenges the notification from the commissioner under 33-2-1908, within 45 days after a notification to the insurer that the commissioner has, after a hearing, rejected the insurer’s challenge.
(5)If the commissioner notifies an insurer that the insurer’s RBC plan or revised RBC plan is unsatisfactory, the commissioner may, at the commissioner’s discretion, subject to the insurer’s right to a hearing under 33-2-1908, specify in the notification that the notification constitutes a regulatory action level event.
(6)Each domestic insurer that files an RBC plan or revised RBC plan with the commissioner shall file a copy of the RBC plan or revised RBC plan with the insurance commissioner in any state in which the insurer is authorized to do business if:
(a)the state has an RBC provision substantially similar to 33-2-1909(1); and
(b)the insurance commissioner of that state has notified the insurer in writing of its request for the filing, in which case the insurer shall file a copy of the RBC plan or revised RBC plan in that state by the later of:
(i)15 days after the receipt of notice to file a copy of its RBC plan or revised RBC plan with that state; or
(ii)the date on which the RBC plan or revised RBC plan is filed under subsections (3) and (4).