17:48F-14 - Maintenance of tangible net equity - New Jersey Statutes

17:48F-14  Maintenance of tangible net equity.

14.  a.  Except as provided in subsection b. of this section, each prepaid prescription service organization shall, at all times, have and maintain tangible net equity equal to the greater of:

(1) $50,000; or

(2)2% of the organization's annual gross premium income, up to a maximum of the required capital and surplus of an admitted health insurer.

b.An organization which has uncovered expenses in excess of $50,000, as reported on the most recent annual financial statement filed with the commissioner, shall maintain tangible net equity equal to 25% of the uncovered expense in excess of $50,000, in addition to the tangible net equity required by subsection a. of this section.

c.The dollar amounts specified in subsections a. and b. of this section shall be adjusted annually by the commissioner, by regulation, in accordance with changes in the Consumer Price Index.

L.1997,c.380,s.14.