2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-90. Approval of Commissioner of acquisition of control; hearing.

(A) The director or his designee shall approve a merger or other acquisition of control in Section 38-21-60 unless, after a public hearing, he finds that:
(1) After the change of control the domestic insurer referred to in Section 38-21-60 is not able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed.
(2) The effect of the merger or other acquisition of control would substantially lessen competition in insurance in this State or tend to create a monopoly. In applying the competitive standard in this item:
(a) The information requirements and standards of Section 38-21-125(C) and (D) apply.
(b) The merger or other acquisition must not be approved if the director or his designee finds that at least one of the situations in Section 38-21-125(D) exists.
(c) The director or his designee may condition the approval of the merger or other acquisition on the removal of the basis of disapproval within a specified period of time.
(3) The financial condition of the acquiring party might jeopardize the financial stability of the insurer or prejudice the interest of its policyholders.
(4) The plans or proposals which the acquiring party has to liquidate the insurer, sell its assets, or consolidate or merge it with a person or to make another material change in its business or corporate structure or management are unfair and unreasonable to policyholders of the insurer and not in the public interest.
(5) The competence, experience, and integrity of those persons who would control the operation of the insurer are such that it is not in the interest of policyholders of the insurer and of the public to permit the merger or other acquisition of control.
(6) The acquisition is likely to be hazardous or prejudicial to the insurance-buying public.
(B) The public hearing referred to in subsection (A) must be held within thirty days after the statement required by Section 38-21-60 is filed, and at least twenty days' notice must be given by the director or his designee to the person filing the statement, to the insurer, and to other persons designated by the director or his designee. The director or his designee shall make a determination within thirty days after the conclusion of the hearing. At the hearing, the person filing the statement, the insurer, a person to whom notice of hearing was sent, and other persons whose interests are affected may present evidence, examine and cross-examine witnesses, and offer oral and written arguments and are entitled to conduct discovery proceedings in the same manner allowed in the circuit courts of this State. Discovery proceedings must be concluded not later than three days before the public hearing.
(C)(1) If the proposed acquisition of control will require the approval of more than one commissioner, the public hearing provided in subsections (A) and (B) may be held on a consolidated basis upon request of the person filing the statement referred to in Section 38-21-60 if he files the statement with the National Association of Insurance Commissioners (NAIC) within five days after making the request for a public hearing. The director or his designee may opt out of a consolidated hearing, but shall provide notice of its decision of the opt out to the applicant within ten days after receipt of the statement. A hearing conducted on a consolidated basis must be public and held within the United States before the commissioners of the states in which the insurers are domiciled. These commissioners shall hear and receive evidence. The director or his designee may attend the hearing in person or by means of telecommunication.
(2) For purposes of this subsection, "commissioner" means the:
(a) insurance commissioner, director, or other chief insurance official of a state, territory, or the District of Columbia;
(b) deputy of a commissioner; and
(c) Insurance Department of a state, territory, or District of Columbia, as appropriate.
(D) The director may retain at the acquiring person's expense attorneys, actuaries, accountants, and other experts not otherwise a part of the department's staff reasonably necessary to assist the director or his designee in reviewing the proposed acquisition of control.
HISTORY: Former 1976 Code Section 38-29-90 [1962 Code Section 37-1408; 1971 (57) 351; 1986 Act No. 426, Section 6] recodified as Section 38-21-90 by 1987 Act No. 155, Section 1; 1991 Act No. 13, Section 13; 1993 Act No. 181, Section 567; 2015 Act No. 2 (S.342), Section 6, eff March 9, 2015.
Effect of Amendment
2015 Act No. 2, Section 6, in (B), substituted "circuit courts" for "Circuit Courts"; added (C); and redesignated former (C) as (D).