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304.36-130 Prevention of insolvencies.
To aid in the detection and prevention of insurer insolvencies:
(1) It shall be the duty of the board of directors, upon majority vote, to notify the
commissioner of any information indicating any member insurer may be
insolvent or in a financial condition hazardous to the policyholders or the public;
(2) The board of directors may, upon majority vote, request that the commissioner
order an examination of any member insurer which the board in good faith
believes may be in a financial condition hazardous to the policyholders or the
public. Within thirty (30) days of the receipt of such request, the commissioner
shall begin such examination. The examination may be conducted as a
National Association of Insurance Commissioners examination or may be
conducted by such persons as the commissioner designates. The cost of such
examination shall be paid by the association and the examination report shall
be treated as are other examination reports. In no event shall such examination
report be released to the board of directors prior to its release to the public, but
this shall not preclude the commissioner from complying with subsection (3) of
this section. The commissioner shall notify the board of directors when the
examination is completed. The request for an examination shall be kept on file
by the commissioner but it shall not be open to public inspection prior to the
release of the examination report to the public;
(3) It shall be the duty of the commissioner to report to the board of directors when
the commissioner has reasonable cause to believe that any member insurer
examined or being examined at the request of the board of directors may be
insolvent or in a financial condition hazardous to the policyholders or the public;
(4) The board of directors may, upon majority vote, make reports and
recommendations to the commissioner upon any matter germane to the
solvency, liquidation, rehabilitation or conservation of any member insurer.
Such reports and recommendations shall not be considered public documents;
(5) The board of directors may, upon majority vote, make recommendations to the
commissioner for the detection and prevention of insurer insolvencies; and
(6) The board of directors shall, at the conclusion of any insurer insolvency in
which the association was obligated to pay covered claims, prepare a report on
the history and causes of such insolvency, based on the information available
to the association, and submit such report to the commissioner.
Effective:July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 1469, effective July 15, 2010. -Created 1972 Ky. Acts ch. 137, sec. 13, effective June 16, 1972.
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