26-42-110. Prevention of insolvencies.

(a) To aid in the detection and prevention of member insurer insolvencies or impairments, the commissioner shall:

(i) Notify the commissioners of all the other states, territories of the United States and the District of Columbia by mail within thirty (30) days of any of the following actions taken against a member insurer:

(A) Revocation of license;

(B) Suspension of license; or

(C) Issuance of any formal order requiring the member insurer to:

(I) Restrict its premium writing;

(II) Obtain additional contributions to surplus;

(III) Withdraw from the state;

(IV) Reinsure all or any part of its business; or

(V) Increase capital, surplus or any other account for the security of policy owners, contract owners, certificate holders or creditors.

(ii) Report to the board of directors when he has taken any actions provided by paragraph (i) of this subsection or has received a report from any other commissioner indicating that any action provided by paragraph (i) of this subsection has been taken in another state. The report to the board of directors shall contain all significant details of the action taken or the report received from another commissioner;

(iii) Report to the board of directors when he has reasonable cause to believe from any completed or pending examination of any member company that the company may be an impaired or insolvent insurer;

(iv) Furnish to the board of directors the national association of insurance commissioners insurance regulatory information system ratios and listings of companies not included in the ratios developed by the national association of insurance commissioners, and the board may use this information in carrying out its duties and responsibilities under this section. The report and its information shall be kept confidential by the board of directors until the commissioner or other lawful authority makes it a public record.

(b) The commissioner may seek the advice and recommendations of the board of directors concerning any matter affecting his duties and responsibilities regarding the financial condition of member insurers and insurers or health maintenance organizations seeking admission to transact business in this state.

(c) The board of directors may by majority vote make reports and recommendations to the commissioner upon any matter germane to the solvency, liquidation, rehabilitation or conservation of any member insurer or germane to the solvency of any insurers or health maintenance organizations seeking to do any business in this state. The reports and recommendations are confidential and shall not be considered public documents.

(d) It is the duty of the board of directors by majority vote to notify the commissioner of any information indicating any member insurer may be an impaired or insolvent insurer.

(e) The board of directors may by majority vote request that the commissioner order an examination of any member insurer which the board in good faith believes may be an impaired or insolvent insurer. Within thirty (30) days of the receipt of a request, the commissioner shall begin an examination. The examination may be conducted as a national association of insurance commissioners examination or may be conducted by persons designated by the commissioner. The cost of the examination shall be paid by the association and the examination report shall be treated the same as other examination reports. In no event shall the examination report be released to the board of directors prior to its release to the public, but this shall not preclude the commissioner from complying with subsection (a) of this section. The commissioner shall notify the board of directors when the examination is completed. The request for an examination shall be kept on file by the commissioner but it shall not be open to public inspection prior to the release of the examination report to the public.

(f) The board of directors may by majority vote make recommendations to the commissioner for the detection and prevention of member insurer insolvencies.

(g) The board of directors shall at the conclusion of any insurer insolvency in which the association was obligated to pay covered claims prepare a report to the commissioner containing information it has in its possession bearing on the history and causes of the insolvency. The board shall cooperate with the boards of directors of guaranty associations in other states in preparing a report on the history and causes of insolvency of a particular insurer and may adopt by reference any report prepared by other associations.