N.Y. Insurance Law 1710 – Divestiture of control; superintendent's power to order disposition of subsidiaries
§ 1710. Divestiture of control; superintendent's power to order disposition of subsidiaries.
Terms Used In N.Y. Insurance Law 1710
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Parent corporation: means a parent corporation of a type described in subsection (a), (b) or (c) of section one thousand seven hundred one of this article. See N.Y. Insurance Law 1702
- Subsidiary: means subsidiaries of the types described in subsection (b) of section one thousand seven hundred four of this article and subsidiaries acquired or held under this article, section one thousand four hundred five or section four thousand two hundred forty of this chapter, but shall not include a subsidiary acquired or held under section one thousand four hundred four of this chapter or a subsidiary acquired or held by an insurer authorized to make investments by subsection (c) of section one thousand four hundred three of this chapter. See N.Y. Insurance Law 1702
(a) Any parent corporation seeking to divest its controlling interest in a domestic insurer, in any manner, shall file with the superintendent, with a copy to the insurer, notice of its proposed divestiture at least thirty days prior to the cessation of control, provided, however that this subsection shall not apply if notice is provided as required by subsection (b) of section one thousand seven hundred one of this article.
(b) In addition to the powers granted to the superintendent elsewhere in this chapter (including, without limitation, § 109 of the financial services law), the superintendent may, at any time, order a parent corporation to dispose of any subsidiary, if the superintendent finds, after notice and an opportunity to be heard, either:
(1) that its acquisition or continued retention is or was not permitted by the provisions of this article; or
(2) except in the case of a subsidiary then exempted by the provisions of subsection (a) or (b) of section one thousand seven hundred four of this article, that its continued retention is materially adverse to the interests of the parent corporation's policyholders or subscribers.