NAC681B.495. Preparation and submission of plan for risk-based capital.

     1. If an event that requires company action occurs, the insurer shall prepare and submit to the Commissioner a plan for risk-based capital which:

     (a) Identifies the conditions that contributed to the event which requires company action.

     (b) Contains proposals for corrective actions that the insurer will take which are expected to result in the elimination of the event.

     (c) Provides projections for financial results of the insurer, including projections of new and renewal business, operating income, net income, and capital and surplus, for the current year and at least the next 4 succeeding years, both in the absence of the proposed corrective actions and if the proposed corrective actions are carried out. The projections for both new and renewal business may include separate projections for each major line of business written by the insurer and identify separately each significant component of income, expenses and benefits.

     (d) Identifies the key assumptions impacting the projections of the insurer and the sensitivity of those projections to the assumptions made by the insurer.

     (e) Identifies the quality of, and problems associated with, the business of the insurer, including, but not limited to, its assets, its anticipated business growth and associated strain on its surplus, any extraordinary exposure to risk, its mix of business and its use of reinsurance, if any.

     2. The plan for risk-based capital must be submitted not later than 45 days after the date on which the event that requires company action occurs.

     (Added to NAC by Comm’r of Insurance by R088-97, eff. 3-19-98)