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Alaska Statutes.

Title 21. Insurance

Chapter 78. Rehabilitation and Liquidation

Section 40. Grounds For Rehabilitation.

AS 21.78.040. Grounds For Rehabilitation.

(a) The director may apply to the court for an order appointing the director as receiver of and directing the director to rehabilitate a domestic insurer when the insurer

(1) is impaired or insolvent;

(2) has refused to submit any of its books, records, accounts, or affairs to reasonable examination by the director;

(3) has concealed or wrongfully removed records or assets or otherwise violated AS 21.69.390 ;

(4) has failed to comply with an order of the director to make good an impairment of capital or surplus or both;

(5) has transferred or attempted to transfer substantially its entire property or business, or has entered into a transaction the effect of which is to merge substantially its entire property or business in that of any other insurer without having first obtained the written approval of the director;

(6) is found, after examination, to be in such condition that its further transaction of business will be hazardous to its policyholders, or to its creditors, or to its members, subscribers, or stockholders, or to the public;

(7) has an officer, director, or manager who has refused to be examined under oath, concerning its affairs, for which purpose the director is authorized to conduct and to enforce by all appropriate and available means an examination under oath in another state or territory of the United States, in which the officer, director, or manager may then presently be, to the full extent permitted by the laws of the other state or territory, this special authorization considered;

(8) has been or is the subject of an application for the appointment of a receiver, trustee, custodian, or sequestrator of the insurer or its property otherwise than under the provisions of this title, but only if the appointment has been made or is imminent and its effect is or would be to oust the courts of this state of jurisdiction;

(9) has consented to such an order through a majority of its directors, stockholders, members, or subscribers;

(10) has failed to pay a final judgment rendered against it in this state upon any insurance contract issued or assumed by it, within 30 days after the judgment became final or within 30 days after the time for taking an appeal has expired, or within 30 days after dismissal of an appeal before final termination, whichever date is the later;

(11) has failed to remove a person who, in fact, has executive authority in the insurer, whether an officer, manager, general agent, employee, or other person, if the person has been found after notice and hearing by the director to be dishonest or untrustworthy in a way affecting the insurer's business;

(12) after demand by the director under AS 21.06.120 or under this chapter, has failed to promptly make available for examination its own property, books, accounts, documents, or other records, or those of a subsidiary or related company within the control of the insurer, or those of a person having executive authority in the insurer so far as they pertain to the insurer;

(13) has, within the previous four years, wilfully violated its charter or articles of incorporation, its bylaws, an insurance law of this state, or a valid order of the director issued under this title;

(14) has failed to file, within the time allowed by law, its annual report or other financial report required by statute and, after written demand by the director, has failed to give an immediate and adequate explanation; or

(15) has reached an authorized control level event under AS 21.14.040 or a mandatory control level event under AS 21.14.050 .

(b) The director may apply to the court for an order appointing the director as receiver of a domestic insurer, and directing the director to rehabilitate the insurer if

(1) there is reasonable cause to believe that there has been embezzlement from the insurer, wrongful sequestration or diversion of the insurer's assets, forgery or fraud affecting the insurer, or other illegal conduct in, by, or with respect to the insurer that, if established, would endanger assets in an amount threatening the solvency of the insurer;

(2) control of the insurer, whether by stock ownership or otherwise, and whether direct or indirect, is in a person or persons found after notice and hearing to be untrustworthy;

(3) a person who, in fact, has executive authority in the insurer, whether an officer, manager, general agent, director or trustee, employee, or other person, has refused to be examined under oath by the director concerning the insurer's affairs, whether in this state or elsewhere, and after reasonable notice of the fact the insurer has failed to promptly and effectively terminate the employment and status of the person and the person's influence on management.

Note to HTML Version:

This version of the Alaska Statutes is current through December, 2004. The Alaska Statutes were automatically converted to HTML from a plain text format. Every effort has been made to ensure their accuracy, but this can not be guaranteed. If it is critical that the precise terms of the Alaska Statutes be known, it is recommended that more formal sources be consulted. For statutes adopted after the effective date of these statutes, see, Alaska State Legislature If any errors are found, please e-mail Touch N' Go systems at E-mail. We hope you find this information useful.

Last modified 9/3/2005