The superintendent may apply under Chapter 59A, Article 41 NMSA 1978 for an order directing him to rehabilitate or liquidate a domestic insurer or the United States branch of an alien insurer having trusteed assets in this state upon any one or more of the following grounds, that the insurer:

A. is insolvent as determined from an examination of the insurer conducted by the superintendent;

B. has refused to submit its books, papers, accounts or affairs to the reasonable inspection of the superintendent or his deputy or examiner;

C. has failed or refused to comply, within the time designated by the superintendent, with an order of the superintendent, pursuant to law, to make good an impairment of its capital, if a stock insurer, or an impairment of its minimum surplus, if a mutual, reciprocal or Lloyds insurer;

D. has, by contract of reinsurance or otherwise, transferred or attempted to transfer substantially its entire property or business or entered into any transaction the effect of which is to merge substantially its entire property or business in the property or business of any other person, without having first obtained the written approval of the superintendent;

E. is found, after an examination, to be in such condition that its further transaction of business will be hazardous to its policyholders, or to its creditors, or to the public;

F. has willfully violated its charter or any law of the state;

G. has an officer who has refused to be examined under oath, concerning its affairs;

H. after examination, is found to no longer meet the requirements for organization and incorporation to do business under the laws of this state;

I. has ceased to do business for a period of two years;

J. has commenced voluntary liquidation or dissolution, or attempts to commence or prosecute any action or proceeding to liquidate its business or affairs, or to dissolve its corporate charter, or to procure the appointment of a receiver, trustee, custodian or sequestrator under any law except Chapter 59A, Article 41 NMSA 1978;

K. has been the subject of an application for the appointment of a receiver, trustee, custodian or sequestrator of the insurer or its property, or if a receiver, trustee, custodian or sequestrator is appointed by a federal court or if such appointment is imminent;

L. has consented to such an order through a majority of its directors, stockholders or members;

M. has not organized or completed its organization and obtained a certificate authorizing it to commence the doing of an insurance business within one year from the date of its incorporation or within such further period as may have been allowed under Section 59A-34-7 NMSA 1978;

N. has failed or refused to take such steps as may be necessary to remove from office any officer or director whom the superintendent has found, after notice to and hearing of such insurer and of such officer or director, to be a dishonest or untrustworthy person; or

O. has failed to maintain adequate risk-based capital levels as determined by the superintendent pursuant to the Risk-Based Capital Act [Chapter 59A, Article 5A NMSA 1978].

History: Laws 1984, ch. 127, § 720; 1995, ch. 149, § 16.

The 1995 amendment, effective June 16, 1995, substituted "Chapter 59A, Article 41 NMSA 1978" for "this article" in the introductory paragraph and in Subsection J; substituted "Section 59A-34-7 NMSA 1978" for "Section 553 of the Insurance Code" at the end in Subsection M; added Subsection O; and made minor stylistic changes.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 43 Am. Jur. 2d Insurance §§ 124 to 126.