§ 58-12-2. Definitions. - North Carolina Statutes

§ 58‑12‑2. Definitions.

As used in this Article, thefollowing terms have the following meanings:

(1)        Adjusted risk‑basedcapital report. – A risk‑based capital report that has been adjusted bythe Commissioner under G.S. 58‑12‑6.

(2)        Corrective order. – Anorder issued by the Commissioner specifying corrective actions that theCommissioner has determined are required.

(3)        Domestic insurer. –Any insurance company or health organization organized in this State underArticle 7, 15, 65, or 67 of this Chapter.

(4)        Foreign insurer. –Any insurance company or health organization that is admitted to do business inthis State under Article 16 or 67 of this Chapter but is not domiciled in thisState.

(4a)      Health organization.– Any health maintenance organization, limited health service organization,dental or vision plan, hospital, medical, or dental indemnity or servicecorporation, or other organization licensed under Article 65 or 67 of thisChapter. "Health organization" does not include an insurer that islicensed as either a life or health insurer or a property or casualty insurerunder this Chapter and that is otherwise subject to either the life or propertyand casualty risk‑based capital requirements.

(4b)      Life or healthinsurer. – Any insurance company licensed to write the kinds of insurancespecified in G.S. 58‑7‑15(1), (2), or (3); or a licensed propertyand casualty insurer writing only the kinds of insurance specified in G.S. 58‑7‑15(3).

(5)        Negative trend. – Anegative trend, with respect to a life or health insurer, over a period oftime, as determined in accordance with the "trend test calculation"included in the risk‑based capital instructions.

(5a)      Property or casualtyinsurer. – Any insurance company licensed to write the kinds of insurance specifiedin G.S. 58‑7‑15(4) through (22); but not monoline mortgage guarantyinsurers, financial guaranty insurers, or title insurers.

(6)        Risk‑basedcapital instructions. – The risk‑based capital report including risk‑basedcapital instructions adopted by the NAIC, as those risk‑based capitalinstructions may be amended by the NAIC from time to time in accordance withthe procedures adopted by the NAIC.

(7)        Risk‑basedcapital level. – An insurer's company action level risk‑based capital,regulatory action level risk‑based capital, authorized control level risk‑basedcapital, or mandatory control level risk‑based capital where:

a.         "Company actionlevel risk‑based capital" means, with respect to any insurer, theproduct of 2.0 and its authorized control level risk‑based capital.

b.         "Regulatoryaction level risk‑based capital" means the product of 1.5 and itsauthorized control level risk‑based capital.

c.         "Authorizedcontrol level risk‑based capital" means the number determined underthe risk‑based capital formula in accordance with the risk‑basedcapital instructions.

d.         "Mandatorycontrol level risk‑based capital" means the product of .70 and theauthorized control level risk‑based capital.

(8)        Risk‑basedcapital plan. – A comprehensive financial plan containing the elementsspecified in G.S. 58‑12‑11(b). If the Commissioner rejects the risk‑basedcapital plan, and it is revised by the insurer, with or without theCommissioner's recommendation, the plan shall be called the "revised risk‑basedcapital plan".

(9)        Risk‑basedcapital report. – The report required in G.S. 58‑12‑6.

(10)      Total adjustedcapital. – The sum of:

a.         An insurer'sstatutory capital and surplus, as determined in accordance with the statutoryaccounting applicable to the annual financial statements required under G.S. 58‑2‑165;and

b.         Such other items, ifany, as the risk‑based capital instructions may provide. (1993 (Reg. Sess., 1994), c.678, s. 1; 1995, c. 318, s. 2; 2001‑223, ss. 12.1, 12.2, 12.3.)