§ 23-69-156 - Nonactive corporate charter -- Nullification. - Arkansas Statutes

23-69-156. Nonactive corporate charter -- Nullification.

(a) As used in this section, a corporation shall be deemed to have engaged in the business of insurance as a domestic insurer if any of its officers, directors, agents, or employees has engaged in:

(1) The writing of insurance;

(2) The reinsurance of risks;

(3) The handling of claims; or

(4) Any acts necessary or incidental to writing insurance, reinsuring risks, or handling claims.

(b) The corporate charter of any corporation formed under the laws of this state more than three (3) years prior to January 1, 1960, for the purpose of becoming an insurer and which corporation within the three-year period has not at any time actively engaged in business as a domestic insurer under a certificate of authority issued to it by the Insurance Commissioner under laws then in force, is extinguished and nullified.

(c) The corporate charter of any other corporation formed under the laws of this state for the purpose of becoming an insurer, and which corporation during any period of thirty-six (36) consecutive months after January 1, 1960, is not actively engaged in business as a domestic insurer under a certificate of authority issued to it by the commissioner under laws currently in force, is not automatically extinguished and nullified at the expiration of the thirty-six-month period.

(d) The period during which a corporation referred to in subsection (c) of this section is the subject of delinquency proceedings under 23-68-101 -- 23-68-113 and 23-68-115 -- 23-68-132 shall not be counted as part of any such thirty-six-month period.

(e) Upon merger or consolidation of a domestic insurer with another insurer under this chapter, the corporate charter of the merged or consolidated domestic insurer shall automatically be extinguished and nullified.

(f) (1) In the event a domestic insurer assumption reinsures all of the ceding domestic insurer's business in force or all except a token amount of the ceding domestic insurer's business, the commissioner, after notice and a hearing, shall make a determination and order that the ceding domestic insurer's corporate charter is extinguished or is continued in full force and effect.

(2) In making such a determination and order, the commissioner shall fully consider the equities to the stockholders, or members if the ceding domestic insurer is a mutual, and the policyholders of the ceding domestic insurer.

(3) With regard to proposed transactions of a domestic insurer which is a subsidiary or affiliate of a depository institution, the hearing shall be concluded and the order issued within the period required by federal law, and the order shall be final upon entry.