Effective 28 Aug 1987

354.707. Capital, surplus, security required — cash, securities, bond to be deposited or filed with director, director to return deposit, when — security subject to final judgments — security not required for prepaid dental plans funded by government — director may waive capital, surplus, security requirements, when. — 1. No prepaid dental plan corporation may commence or continue to do business with a capital of less than fifty thousand and a surplus of less than fifty thousand dollars.

2. No prepaid dental plan corporation may commence or continue to do business until the company has transferred to and deposited with the director, for the security of its enrollees, cash, securities, or a bond in the amount of the minimum capital of fifty thousand dollars. Such securities or bond shall be of a type approved by the director. The director shall not receive securities at an amount above their par value or above their current market value, whichever is less. If the market value of the securities on deposit falls below the minimum capital amount of fifty thousand dollars, the company shall deposit additional securities to equal the minimum amount.

(1) The cash or securities representing the deposit required by this section shall be deposited with the director who shall give receipts for all securities so deposited with him to the prepaid dental care corporation. The director shall upon the receipt of such securities deposit the same, in the presence of an authorized officer of the depositing corporation, in a safety deposit box accessible only to the director or his representative and an authorized employee of the corporation, or in the vault of any bank, trust company, or safety deposit company in the state of Missouri to be selected by the director, and the depositing corporation shall pay the fees for such boxes. So long as the depositing corporation continues solvent, the director shall permit such corporation to collect and receive the interest and dividends on the securities so deposited, and, from time to time, withdraw any such securities on depositing other acceptable securities in the place of those so withdrawn. If the director willfully fails, refuses, or neglects to faithfully keep, deposit, and account for any such securities received by him, or willfully fails, refuses, or neglects to furnish proper certificate of securities so held by him, the director shall be responsible therefor upon his official bond, and suit may be brought upon such bond by any person damaged by such failure, refusal, or neglect.

(2) An unpaid final judgment arising upon an enrollee contract or contract certificate shall be a lien on the deposit prescribed by this subsection, subject to execution after thirty days from the entry of final judgment. If the deposit is reduced, it shall be replenished within twenty days by the prepaid dental care corporation.

(3) Upon the liquidation or dissolution of a prepaid dental plan corporation and the satisfaction of all its debts and liabilities, any balance remaining of the deposit shall be returned by the director to the prepaid dental plan corporation.

(4) The deposit prescribed by this subsection shall not apply with respect to a prepaid dental plan corporation which is funded by a federal, state, or municipal government or by any political subdivision thereof to the extent and for such period of time that the prepaid dental plan corporation can demonstrate to the director the presence of operational commitments from such sources equivalent to such deposit.

3. The director may waive any of the requirements of subsection 1 or 2, or both, of this section for any prepaid dental plan corporation, if it is shown to his satisfaction that such corporation possesses not less than fifty thousand dollars equity in unencumbered fixed assets.

­­--------

(L. 1987 S.B. 272 § 5)