§ 27-4.6-4 - Regulatory action level event. - Rhode Island Statutes

SECTION 27-4.6-4

   § 27-4.6-4  Regulatory action level event.– (a) "Regulatory action level event" means, with respect to any insurer, any ofthe following events:

   (1) The filing of an RBC report by the insurer whichindicates that the insurer's total adjusted capital is greater than or equal toits authorized control level RBC but less than its regulatory action level RBC;

   (2) The notification by the commissioner to an insurer of anadjusted RBC report that indicates the event in subdivision (a)(1), providedthe insurer does not challenge the adjusted RBC report under § 27-4.6-7;

   (3) If, pursuant to § 27-4.6-7, the insurer challengesan adjusted RBC report that indicates the event in subdivision (a)(1), thenotification by the commissioner to the insurer that the commissioner has,after a hearing, rejected the insurer's challenge;

   (4) The failure of the insurer to file an RBC report by thefiling date, unless the insurer has provided an explanation for that failurewhich is satisfactory to the commissioner and has cured the failure within ten(10) days after the filing date;

   (5) The failure of the insurer to submit an RBC plan to thecommissioner within the time period set forth in § 27-4.6-3(c);

   (6) Notification by the commissioner to the insurer that:

   (i) The RBC plan or revised RBC plan submitted by the insureris, in the judgment of the commissioner, unsatisfactory; and

   (ii) The notification constitutes a regulatory action levelevent with respect to the insurer, provided the insurer has not challenged thedetermination under § 27-4.6-7;

   (7) If, pursuant to § 27-4.6-7, the insurer challenges adetermination by the commissioner under subdivision (a)(6), the notification bythe commissioner to the insurer that the commissioner has, after a hearing,rejected those challenges;

   (8) Notification by the commissioner to the insurer that theinsurer has failed to adhere to its RBC plan or revised RBC plan, but only ifthat failure has a substantial adverse effect on the ability of the insurer toeliminate the company action level event in accordance with its RBC plan orrevised RBC plan and the commissioner has stated this in the notification,provided the insurer has not challenged the determination under §27-4.6-7; or

   (9) If, pursuant to § 27-4.6-7, the insurer challenges adetermination by the commissioner under subdivision (a)(8), the notification bythe commissioner to the insurer that the commissioner has, after a hearing,rejected the challenge.

   (b) In the event of a regulatory action level event thecommissioner shall:

   (1) Require the insurer to prepare and submit an RBC plan or,if applicable, a revised RBC plan;

   (2) Perform any examination or analysis as the commissionerdeems necessary of the assets, liabilities and operations of the insurerincluding a review of its RBC plan or revised RBC plan; and

   (3) Subsequent to the examination or analysis, issue an orderspecifying any corrective actions as the commissioner shall determine arerequired (a "corrective order").

   (c) In determining corrective actions, the commissioner maytake into account any factors as are deemed relevant with respect to theinsurer based upon the commissioner's examination or analysis of the assets,liabilities and operations of the insurer, including, but not limited to, theresults of any sensitivity tests undertaken pursuant to the RBC instructions.The RBC plan or Revised RBC plan shall be submitted:

   (1) Within forty-five (45) days after the occurrence of theregulatory action level event;

   (2) If the insurer challenges an adjusted RBC report pursuantto § 27-4.6-7 and the challenge is not frivolous in the judgment of thecommissioner, within forty-five (45) days after the notification to the insurerthat the commissioner has, after a hearing, rejected the insurer's challenge; or

   (3) If the insurer challenges a revised RBC plan pursuant to§ 27-4.6-7 and the challenge is not frivolous in the judgment of thecommissioner, within forty-five (45) days after the notification to the insurerthat the commissioner has, after a hearing, rejected the insurer's challenge.

   (d) The commissioner may retain actuaries and investmentexperts and other consultants necessary in the judgment of the commissioner toreview the insurer's RBC plan or revised RBC plan, examine or analyze theassets, liabilities and operations of the insurer and formulate the correctiveorder with respect to the insurer. The fees, costs and expenses relating toconsultants shall be borne by the affected insurer or any other party asdirected by the commissioner.