31A-1-106 - Residual unlicensed domestic insurers.
31A-1-106. Residual unlicensed domestic insurers.
(1) Every person doing an insurance business in Utah not covered under another sectionof this title, that does not hold a valid certificate of authority or license under this title shall, byJuly 1, 1987, complete one of the actions prescribed in Subsections (2) through (5). This sectiondoes not apply to an unauthorized foreign insurer doing an insurance business in Utah in fullcompliance with Section 31A-15-103.
(2) An insurer under Subsection (1) may incorporate and apply, or if alreadyincorporated, may apply for a certificate of authority under Chapter 5, 6, 7, 8, or 9. If thecommissioner is satisfied that the insurer substantially complies with the requirements of theappropriate chapter necessary for the protection of insureds and the public, the commissionershall issue a certificate of authority.
(3) An insurer under Subsection (1) may transfer all its obligations to a corporationauthorized under this title to assume them, according to a plan approved by the commissioner. The commissioner may disapprove the plan on a finding, after a hearing, that it is contrary to theinterests of insureds, the public, or the law.
(4) An insurer under Subsection (1) may adopt a plan to run off existing obligationswithout accepting any new policyholders or new obligations. The commissioner may disapprovethe plan on a finding, after a hearing, that it is contrary to the interests of insureds, the public, orthe law.
(5) The commissioner may, by order, exempt an insurer from the requirements ofSubsection (1) or extend the deadline under Subsection (1) on a finding that:
(a) incorporation, licensing, reinsurance, or run off would cause disproportionateexpense, loss, or substantial hardship; and
(b) the nature of the existing and prospective business, the assets, or the business plan ofthe insurer can be reasonably expected to continue to operate in a sound manner and can besubjected to adequate regulatory controls.
(6) Whenever the commissioner grants an exemption under Subsection (5), thecommissioner shall issue to the insurer a certificate of authority. The commissioner may amendthe certificate at any time, specifying the business that the insurer may transact and specifying indetail the controls to which the insurer shall be subject. These controls shall correspond as nearlyas practicable to the controls applicable to corporations transacting a like business.
(7) It is a ground for liquidation under Section 31A-27a-207 if an insurer has notcompleted action under one of Subsections (2) through (4) and has not applied for and beengranted exemption under Subsection (5) before July 1, 1987.
Amended by Chapter 309, 2007 General Session