1506 - Acquisition or retention of control of insurers.

§  1506.  Acquisition  or  retention  of  control  of insurers. (a) No  person, other than an authorized insurer, shall acquire control  of  any  domestic  insurer,  whether  by purchase of its securities or otherwise,  unless:    (1) it gives twenty days' written  notice  to  the  insurer,  or  such  shorter period of notice as the superintendent permits, of its intention  to acquire control, and    (2) it receives the superintendent's prior approval.    (b)  The  superintendent  shall  disapprove  such  acquisition  if  he  determines, after notice and an  opportunity  to  be  heard,  that  such  action is reasonably necessary to protect the interests of the people of  this  state. Only the following factors may be considered in making such  determination:    (1) the financial condition of the acquiring person and the insurer;    (2) the trustworthiness of the acquiring person or any of its officers  or directors;    (3) a plan for the proper  and  effective  conduct  of  the  insurer's  operations;    (4) the source of the funds or assets for the acquisition;    (5)  the  fairness  of  any  exchange of shares, assets, cash or other  consideration for the shares or assets to be received;    (6) whether the effect of the  acquisition  may  be  substantially  to  lessen  competition  in  any line of commerce in insurance or to tend to  create a monopoly therein; and    (7) whether the acquisition is likely to be hazardous  or  prejudicial  to the insurer's policyholders or shareholders.    (c)  (1)  The  following  conditions affecting any controlled insurer,  regardless of when such control has been  acquired,  are  violations  of  this article:    (A)  the  controlling  person or any of its officers or directors have  demonstrated untrustworthiness; and    (B) the effect of retention of control, in  the  case  of  a  domestic  controlled  insurer,  may  be substantially to lessen competition in any  line of commerce in insurance or to tend to create a  monopoly  therein,  or,  in  the  case  of  a  foreign  or  alien controlled insurer, may be  substantially to lessen competition in any line of commerce in insurance  in this state or to tend to create a monopoly therein.    (2)  If,  after  notice  and  an  opportunity   to   be   heard,   the  superintendent  determines  that any of the foregoing violations exists,  he shall issue an order based on written findings and cause the same  to  be  served  upon  the insurer and all persons affected thereby directing  any person found to be in violation hereof to take appropriate action to  cure such violation. Upon the failure of any such person to comply  with  such  order, section one thousand five hundred ten of this article shall  become applicable.    (d) The superintendent may require the submission of such  information  as  he deems necessary to determine whether any acquisition or retention  of control complies with this article and may require, as a condition of  approval of such acquisition or retention of control, that  all  or  any  portion of such information be disclosed to the insurer's shareholders.    (e)  Unless  subject  to  registration under section one thousand five  hundred three of this article, or unless acquisition of its  control  is  subject  to  subsections  (a)  and  (b) hereof, every authorized insurer  shall, within thirty days after any event  requiring  notice  hereunder,  notify  the superintendent in writing of the identity of any person whom  the insurer then knows or has reason to believe controls, or  has  taken  any  action,  other  than  preliminary  negotiations  or discussions, to  acquire control of the insurer.