2023 New York Laws › ISC - Insurance › Article 15 - Holding Companies › 1506 - Acquisition or Retention of Control of Insurers.

§  1506.  Acquisition  or  retention  of  control  of insurers. (a) No
person, other than an authorized insurer, shall acquire control  of  any
domestic  insurer,  whether  by purchase of its securities or otherwise,
unless:
(1) it gives twenty days  written  notice  to  the  insurer,  or  such
shorter period of notice as the superintendent permits, of its intention
to  acquire control, provided that the notice shall include an agreement
by the person seeking to acquire control that the  person  will  provide
the  annual  report specified in section one thousand five hundred three
of this article for so long as control exists; and
(2) it receives the superintendent's prior approval.
(b)  The  superintendent  shall  disapprove  such  acquisition  if  he
determines,  after  notice  and  an  opportunity  to be heard, that such
action is reasonably necessary to protect the interests of the people of
this state. Only the following factors may be considered in making  such
determination:
(1) the financial condition of the acquiring person and the insurer;
(2) the trustworthiness of the acquiring person or any of its officers
or directors;
(3)  a  plan  for  the  proper  and effective conduct of the insurer's
operations;
(4) the source of the funds or assets for the acquisition;
(5) the fairness of any exchange of  shares,  assets,  cash  or  other
consideration for the shares or assets to be received;
(6)  whether  the  effect  of  the acquisition may be substantially to
lessen competition in any line of commerce in insurance or  to  tend  to
create a monopoly therein; and
(7)  whether  the acquisition is likely to be hazardous or prejudicial
to the insurer's policyholders or shareholders.
(c) (1) The following conditions  affecting  any  controlled  insurer,
regardless  of  when  such  control has been acquired, are violations of
this article:
(A) the controlling person or any of its officers  or  directors  have
demonstrated untrustworthiness; and
(B)  the  effect  of  retention  of control, in the case of a domestic
controlled insurer, may be substantially to lessen  competition  in  any
line  of  commerce in insurance or to tend to create a monopoly therein,
or, in the case of  a  foreign  or  alien  controlled  insurer,  may  be
substantially to lessen competition in any line of commerce in insurance
in this state or to tend to create a monopoly therein.
(2)   If,   after   notice   and  an  opportunity  to  be  heard,  the
superintendent determines that any of the foregoing  violations  exists,
he  shall issue an order based on written findings and cause the same to
be served upon the insurer and all persons  affected  thereby  directing
any person found to be in violation hereof to take appropriate action to
cure  such violation. Upon the failure of any such person to comply with
such order, section one thousand five hundred ten of this article  shall
become applicable.
(d)  The superintendent may require the submission of such information
as he deems necessary to determine whether any acquisition or  retention
of control complies with this article and may require, as a condition of
approval  of  such  acquisition or retention of control, that all or any
portion of such information be disclosed to the insurer's shareholders.
(e) Unless subject to registration under  section  one  thousand  five
hundred  three  of this article, or unless acquisition of its control is
subject to subsections (a) and  (b)  hereof,  every  authorized  insurer
shall,  within  thirty  days after any event requiring notice hereunder,
notify the superintendent in writing of the identity of any person  whom

the  insurer  then knows or has reason to believe controls, or has taken
any action, other  than  preliminary  negotiations  or  discussions,  to
acquire control of the insurer.
(f)  Any holding company 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 (a) of this section.