A. If, after notice and hearing, at the conclusion of the 90-day period the Commissioner determines that the insurer has failed to comply with his lawful requirements, or upon consent of the insurer, he may appoint a conservator, who shall immediately:

1. Take charge of such insurer and all of the property, books, records and effects;

2. Conduct its business; and

3. Take such other steps toward the removal of the causes and conditions which have necessitated such order, as the Commissioner may direct.

B. During the pendency of conservatorship, the conservator shall make such reports as may be required by the Commissioner, and may:

1. Take all necessary measures to preserve, protect and recover any assets or property of such insurer including claims or causes of action belonging to orwhich may be asserted by such insurer in his own name as conservator; and

2. File, prosecute and defend any legal actions which have been filed, or which may thereafter be filed, by or against such insurer, as he deems necessary to protect all of the interested parties or any property affected thereby. The conservator shall file all quarterly and annual reports required by the Oklahoma Insurance Code and in the same manner as the insurer.

C. If upon appointment of a conservator or at any time during the pendency of such conservatorship it appears that the insurer can best be protected by reinsuring the same, the conservator may, with the approval of the Commissioner, after appraisal of all assets of the insurer:

1. Reinsure all or part of such insurer's policies or certificates of insurance with any solvent insurers authorized to transact business in this state; and

2. To the extent that such insurer is possessed of reserves attributable to such policies or certificates of insurance, transfer to the reinsuring company such reserves or any portion thereof as may be required to consummate the reinsurance of such policies, which transfer of reserves shall not be deemed a preference of creditors.

D. If the Commissioner is satisfied that the insurer is not in condition to continue business in the interest of its policy or certificate holders, under the conservator, the Commissioner shall apply to the appropriate court for an order appointing him as receiver for the insurer, under the provisions of Article 18 of this title. It shall be in the discretion of the Commissioner to determine whether or not he will operate the insurance company through a conservator, as provided above, or apply for an order appointing him receiver.

E. The cost incident to the supervisor's and conservator's service shall be fixed by the Commissioner and paid from the assets and funds of the insurer as the Commissioner may determine. The cost of the supervisor's or conservator's service must be reasonable under the circumstances and shall continue no longer than necessary to preserve the assets of the insurer, certificate holders and the policyholders. All legal work required under this act shall be performed by the Commissioner, his employees or special attorneys employed by the Commissioner. The cost of such attorneys' services must be reasonable under the circumstances and shall be paid from the assets and funds of the insurer to the Commissioner.

F. The supervision or conservation may continue until the Commissioner (1) feels certain that the insurer has corrected any deficiencies that caused the supervision or conservation, or (2) a receivership has been granted by the Court.

Amended by Laws 1985, c. 328, § 13, emerg. eff. July 29, 1985.