Section 415-E:7 Insolvency Protection.
I. To assure the faithful performance of its obligations to its member employers and covered employees and their dependents, every arrangement shall, within 30 days after the close of the arrangement's fiscal year, deposit with the commissioner cash, securities, or any combination of these or other measures acceptable to the commissioner, in an amount equal to 25 percent of the preceding 12 months' health care claims expenditures or 5 percent of gross annual premiums for the succeeding year, whichever is greater; however, in no case shall the amount of the deposit exceed $100,000. All income from deposits shall belong to the depositing arrangement and shall be paid to it as it becomes available. An arrangement that has made a securities deposit may withdraw that deposit, or any part of such deposit, after making a substitute deposit of cash, securities, or any combination of these or other measures of equal amount and value, upon approval by the commissioner. No judgment creditor or other claimant of a multiple-employer welfare association shall have the right to levy upon any of the assets or securities held in this state as a deposit under this section.
II. In lieu of the deposit required under paragraph I, an arrangement may file with the commissioner a surety bond in like amount. The bond shall be one issued by an authorized surety insurer, shall be for the same purpose as the deposit in lieu of which it is filed, and shall be subject to the commissioner's approval. No bond shall be canceled or subject to cancellation unless at least 60 days' advance notice of cancellation in writing is filed with the commissioner. No bond shall be approved unless it covers liabilities arising from all policies and contracts issued and entered into during the time the bond is in effect and unless the commissioner is satisfied that the bond provides the same degree of security as would be provided by a deposit of securities.
III. In the event of an insolvency termination, the deposit held by the commissioner pursuant to RSA 415-E:7, I, or the bond held by the commissioner pursuant to RSA 415-E:7, II, shall be applied to the extent of the insolvency. Any deposit funds remaining in excess of the amount needed to make the arrangement solvent shall be distributed in accordance with RSA 415-E:10.
Source. 1991, 246:1, eff. Jan. 1, 1992.