Oregon Administrative Rules › Chapter 836 - DEPARTMENT OF CONSUMER AND BUSINESS SERVICES, INSURANCE REGULATION › Division 13 - ANNUAL STATEMENT; DIRECTOR'S AUTHORITY › Section 836-013-0110 - Standards

Current through Register Vol. 63, No. 7, July 1, 2024
The Director may consider the following standards, either
				singly or in combination of two or more, to determine whether the continued
				operation of any insurer transacting insurance in this state might be
				determined to be hazardous to the policyholders, its creditors or the general
				public:
(1) Adverse findings reported
			 in financial condition and market conduct examination reports, audit reports,
			 and actuarial opinions, reports or summaries.
(2) The National Association of Insurance
			 Commissioners Insurance Regulatory Information System and its other financial
			 analysis solvency tools and reports.
(3) Whether the insurer has made adequate
			 provision, according to presently accepted actuarial standards of practice, for
			 the anticipated cash flows required by the contractual obligations and related
			 expenses of the insurer, when considered in light of the assets held by the
			 insurer with respect to such reserves and related actuarial items including but
			 not limited the investment earnings on such assets, and the considerations
			 anticipated to be received and retained under such policies and
			 contracts.
(4) The ability of an
			 assuming reinsurer to perform and whether the insurer's reinsurance program
			 provides sufficient protection for the insurer's remaining capital and surplus
			 after taking into account the insurer's cash flow and the classes of business
			 written as well as the financial condition of the assuming reinsurer.
(5) Whether the insurer's operating loss in
			 the last 12-month period or any shorter period of time, including but not
			 limited to net capital gain or loss, change in non-admitted assets and cash
			 dividends paid to shareholders, is greater than 50 percent of the insurer's
			 remaining capital and surplus in excess of the minimum required.
(6) Whether the insurer's operating loss in
			 the last 12-month period or any shorter period of time, excluding net capital
			 gains, is greater than 20 percent of the insurer's remaining surplus as regards
			 policyholders in excess of the minimum required.
(7) Whether a reinsurer or obligor, or any
			 entity within the insurer's insurance holding company system is insolvent,
			 threatened with insolvency or delinquent in payment of its monetary or other
			 obligations and which, in the opinion of the director may affect the solvency
			 of the insurer.
(8) Contingent
			 liabilities, pledges or guaranties that either individually or collectively
			 involve a total amount that in the opinion of the Director may affect the
			 solvency of the insurer.
(9)
			 Whether any "controlling person" of an insurer is delinquent in the
			 transmitting to, or payment of, net premiums to the insurer.
(10) The age and collectibility of
			 receivables.
(11) Whether the
			 management of an insurer, including officers, directors or any other person who
			 directly or indirectly controls the operation of the insurer, fails to possess
			 and demonstrate the competence, fitness and reputation determined by the
			 Director to be necessary to serve the insurer in such position.
(12) Whether management of an insurer has
			 failed to respond to inquiries relating to the condition of the insurer or has
			 furnished false and misleading information concerning an inquiry.
(13) Whether the insurer has failed to meet
			 financial and holding company filing requirements in the absence of a reason
			 satisfactory to the director.
(14)
			 Whether management of an insurer either has filed a false or misleading sworn
			 financial statement or has released a false or misleading financial statement
			 to lending institutions or to the general public, or has made a false or
			 misleading entry, or has omitted an entry of material amount in the books of
			 the insurer.
(15) Whether the
			 insurer has grown so rapidly and to such an extent that it lacks adequate
			 financial and administrative capacity to meet its obligations in a timely
			 manner.
(16) Whether the insurer
			 has experienced or will experience in the foreseeable future cash flow or
			 liquidity problems, or both.
(17)
			 Whether management has established reserves that do not comply with minimum
			 standards established by state insurance laws, regulations, statutory
			 accounting standards, sound actuarial principles and standards of
			 practice.
(18) Whether management
			 persistently engages in material under reserving that results in adverse
			 development.
(19) Whether
			 transactions among affiliates, subsidiaries or controlling persons for which
			 the insurer receives assets or capital gains, or both, do not provide
			 sufficient value, liquidity or diversity to assure the insurer's ability to
			 meet its outstanding obligations as they mature.
(20) Any other finding determined by the
			 director to be hazardous to the insurer's policyholders, creditors or general
			 public.
Stat. Auth.: ORS
				  731.244,
				  731.385
Stats. Implemented: ORS
				  731.385