| (a) Notice of Ordinary and Extraordinary Dividends
and Other Distributions. Complete subsections (a) and (b) of this
section for an Ordinary Dividend under §7.203(o) of this title
(relating to Registration of Insurers) and complete subsections (a)
- (c) of this section for an Extraordinary Dividend under §7.204(d)
of this title (relating to Transactions Subject to Prior Notice).
Attached Graphic
(b) Dividend or distribution.
(1) Name of insurer.
(2) Address of insurer.
(3) Declaration of dividend:
(A) Amount of declared dividend or distribution: $
(B) Recipient of declared dividend or distribution.
(C) Declaration date.
(D) Proposed payment date.
(4) The dividend or distribution is in compliance with
the Act and is indicated in subparagraphs (A) and (B) of this paragraph:
(A) Calculation.
(i) Amount of current dividend or distribution: $
(ii) Dividends or distributions paid during preceding
12 months, excluding current dividend or distribution but including
declaration date, payment date, type of dividend or distribution,
and amount: $
(iii) Total of (i) and (ii): $
(iv) Surplus as regards policyholders (net worth for
HMO) as of preceding December 31: $
(I) 10 percent of (iv) for Life, P&C, and HMO:
$
(II) 20 percent of (iv) for Title: $
(v) Operating income:
(I) Net gain from operations before realized capital
gains as of preceding December 31 for Life, Title and HMO: $
(II) Net income as of preceding December 31 for P&C:
$
(vi) Greater of calculated surplus from (iv) or the
operating income from (v): $
(B) If the amount from (iii) exceeds the amount from
(vi), then provide the information required by subsection (c) relating
to extraordinary dividend and distribution.
(5) Earned surplus, defined as the unassigned funds
(surplus), must be greater than the current dividend or distribution
amount stated in (4)(A)(i) of this subsection. Earned surplus must
be calculated as of the most recent financial information available.
(6) Supporting documentation of the balance sheet,
summary of operations including capital and surplus account, and cash
flow statement of the most recently filed monthly, quarterly, or annual
statement, together with documentation to support the standards specified
in Insurance Code §823.008.
(7) Additional requirements are as follows:
(A) Identify property, including bank accounts, to
be used to pay the dividend or distribution or to be converted to
pay the dividend or distribution.
(B) Provide insurer's ratio of net written premium
to capital and surplus for 12 months as of the end of the last calendar
year. In addition, provide the same ratio after deducting the total
amount of the present dividend or distribution.
(C) Identify and describe any reason (other than general
business trends) that earnings are expected to decrease.
(D) Identify any investment or contribution by the
insurer to subsidiaries made since the last calendar year or to be
made in the immediate future.
(E) Give a brief statement as to the effect upon the
insurer's capital and surplus or HMO's net worth and the reasonableness
of remaining capital and surplus or net worth after payment of dividend
or distribution in relation to the insurer's outstanding liabilities
and the adequacy of capital and surplus or net worth relative to the
insurer's financial needs.
(8) Certification that there has been no material adverse
change in the financial condition of the insurer since the date of
the most recent financial statement filed with the department and
the payment of the dividend or distribution does not adversely affect
the interest of policyholders.
(9) Certification that the declaration or payment of
the dividend or distribution does not violate any of the provisions
of Insurance Code Chapter 403 or §841.253, as applicable, and
that the amount of the dividend or distribution declared was calculated
based on the amount of cash and the current fair market value of any
other property to be paid or distributed.
(10) Signature.
Attached Graphic
(c) Extraordinary Dividend and Distribution.
(1) State purpose of dividend or distribution.
(2) On request of the commissioner, furnish a copy
of directors' resolution declaring dividend and any shareholders resolution
supporting the declaration are to be attached to this form.
(3) Effect of declaration.
(A) Give the total amount of dividend or distribution
in dollars when so expressed, or if declared in some other terms,
the approximate dollar value and identify the exact property in which
the dividend or distribution is payable if not cash (include method
of valuing the property other than cash).
(B) Explain any difference in treatment and basis with
regard to any share of issued and outstanding stock that will not
be treated equally in distribution of dividend, excluding treatment
of classes of stock.
(C) Explain basis concerning the different treatment
in distribution of dividend given by class of stock.
(D) Give number of shares by class to whom proposed
dividend is payable, the dividend per share of each class and total
amount of dividend by class of stock.
(E) By class of stock, give total amount of each dividend
declared, the amount payable per share, and the date of declaration
for the five calendar years preceding this notice.
(F) Give the net gain or loss from operations after
dividends to policyholders and federal income taxes, excluding capital
gains and losses of the insurer for each of the last five calendar
years as reported in the insurer's annual statement to the department.
(4) Provide a balance sheet, income statement, and
cash flow statement for the interim period from the last annual statement
to the end of the month preceding the month in which this application
is submitted.
(5) Provide the National Association of Insurance Commissioners
authorized control level Risk Based Capital Ratio before and after
dividend or distribution and projected for year end and the following
year end.
(6) Explain any restrictions on the volume of the insurer's
underwritings within the last year or in the immediate future that
did not previously exist.
(7) Explain any limitations and reasons for limitations
established for geographical underwriting within the last year or
in immediate future that did not previously exist.
(8) Describe the existing reinsurance program of insurer,
including limits of retention.
(9) Identify and describe any deviation of more than
10 percent in value of any loans or investments held by insurer (other
than replacement of maturing securities with comparable securities)
from that disclosed in your last annual statement.
(10) Signature and certification of the following form
is required:
Attached Graphic
|
