26-24-141. Impairment of capital or assets; generally.
(a) If a domestic stock insurer's paid-in capital stock, as represented by the aggregate par value of its outstanding capital stock, or the amount of its surplus, or if the amount of a domestic mutual insurer's surplus, is less than the minimum amounts the insurer is required to maintain under this code for authority to transact the kinds of insurance being transacted, the commissioner shall at once determine the amount of deficiency and notify the insurer to cure the deficiency and file proof thereof with him within the period specified in the notice. The period shall be not less than thirty (30) nor more than ninety (90) days from the date of the notice. The notice may be served by delivery to the insurer or by mailing to the insurer addressed to its principal place of business in this state.
(b) The deficiency shall be made good:
(i) In cash or in assets eligible for investment of the insurer's funds;
(ii) By amendment of the insurer's certificate of authority to cover only the kinds of insurance thereafter for which the insurer has sufficient paid-in capital stock and surplus, if a stock insurer, or surplus, if a mutual insurer, under this code; or
(iii) If a stock insurer, by reduction of the insurer's stated capital or any other lawful means, so that the insurer's resulting paid-in capital stock and surplus are not below the minimums required for the kinds of insurance it transacts.
(c) After any reduction of stated capital, if the reduction results in a decrease in the number of par values of its outstanding capital stock, the insurer's stockholders shall surrender to the insurer their affected stock certificates in exchange for new certificates to be issued for such number or par value of shares, or both, as the stockholders are then entitled to receive.
(d) If the deficiency is not cured and proof thereof filed with the commissioner within the period required by the notice as specified in subsection (a) of this section, the commissioner shall:
(i) Immediately and without further notice or hearing suspend or revoke the insurer's certificate of authority; and
(ii) Take any further action authorized under chapter 28 of this code.
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