(a) Every domestic insurer shall, on or prior to each March 1, prepare and submit to the Commissioner a report of its RBC levels, as of the end of the previous calendar year, containing such information as is required by the RBC instructions. In addition, every domestic insurer shall file its RBC report:

(1) With the NAIC in accordance with the RBC instructions; and

(2) With the insurance commissioner in any state in which the insurer is authorized to do business, if the insurance commissioner has notified the insurer of its request in writing, in which case the insurer shall file its RBC report not later than the later of:

(A) Fifteen days from the receipt of notice to file its RBC report with that state; or

(B) March 1.

(b) A life and health insurer's RBC shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take into account and may adjust for the covariance between:

(1) The risk with respect to the insurer's assets;

(2) The risk of adverse insurance experience with respect to the insurer's liabilities and obligations;

(3) The interest rate risk with respect to the insurer's business; and

(4) All other business risks and such other relevant risks as are set forth in the RBC instructions,

determined in each case by applying the factors in the manner set forth in the RBC instructions.

(c) A property and casualty insurer's or health organization's RBC shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take into account and may adjust for the covariance between:

(1) Asset risk;

(2) Credit risk;

(3) Underwriting risk; and

(4) All other business risks and such other relevant risks as are set forth in the RBC instructions,

determined in each case by applying the factors in the manner set forth in the RBC instructions.

(d) An excess of capital over the amount produced by the risk-based capital requirements contained in the chapter and the formulas, schedules, and instructions referenced in this chapter is desirable in the business of insurance. Accordingly, insurers should seek to maintain capital above the RBC levels required by this chapter. Additional capital is useful in the insurance business and helps to secure an insurer against various risks inherent in or affecting the business of insurance and is not accounted for or only partially measured by the risk-based capital requirements contained in this chapter.

(e) If a domestic insurer files an RBC report which in the judgment of the Commissioner is inaccurate, then the Commissioner shall adjust the RBC report and notify the insurer of the inaccuracy. The notice shall contain a statement of the reason for the inaccuracy. The insurer must, within 30 days, correct the inaccuracy or request a hearing. If the insurer fails to correct the inaccuracy or to request a hearing, the Commissioner may order a hearing to determine the corrections that are necessary. An RBC report adjusted in accordance with this subsection is referred to as an adjusted RBC report.