During the period of supervision, the commissioner or the commissioner’s designated appointee shall serve as the administrative supervisor. The commissioner may provide that the insurer may not do any of the following things during the period of supervision, without the prior approval of the commissioner or the commissioner’s appointed supervisor:

(1) Dispose of, convey or encumber any of its assets or its business in force;

Terms Used In Tennessee Code 56-9-505

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Commissioner: means the commissioner of commerce and insurance. See Tennessee Code 56-9-501
  • Contract: A legal written agreement that becomes binding when signed.
  • Insurer: means and includes every person engaged as indemnitor, surety or contractor in the business of entering into contracts of insurance or of annuities, as limited to:
    (A) Any insurer who is doing an insurer business, or has transacted insurance in this state, and against whom claims arising from that transaction may exist now or in the future. See Tennessee Code 56-9-501
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • Transfer: includes the sale and every other and different mode, direct or indirect, of disposing of or of parting with property or with an interest therein, or with the possession thereof or of fixing a lien upon property or upon an interest therein, absolutely or conditionally, voluntarily, by or without judicial proceedings. See Tennessee Code 56-9-103
(2) Withdraw any of its bank accounts;
(3) Lend any of its funds;
(4) Invest any of its funds;
(5) Transfer any of its property;
(6) Incur any debt, obligation or liability;
(7) Merge or consolidate with another company;
(8) Approve new premiums or renew any policies;
(9) Enter into any new reinsurance contract or treaty;
(10) Terminate, surrender, forfeit, convert or lapse any insurance policy, certificate or contract, except for nonpayment of premiums due;
(11) Release, pay or refund premium deposits, accrued cash or loan values, unearned premiums, or other reserves on any insurance policy, certificate or contract;
(12) Make any material change in management; or
(13) Increase salaries and benefits of officers or directors or the preferential payment of bonuses, dividends or other payments deemed preferential.
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