(a) The director shall disallow as an asset or as a credit against liabilities any reinsurance found by the director, after a hearing, to have been arranged for the purpose principally of deception as to the ceding insurer's financial condition as of the date of any financial statement of the insurer. Without limiting the general purport of this subsection, reinsurance of a substantial part of the insurer's outstanding risks contracted for in fact within four months before the date of any financial statement and cancelled in fact within four months after the date of the statement, or reinsurance under which the reinsurer bears no substantial insurance risk or substantial risk of net loss to itself, shall prima facie be considered to have been arranged for the purpose principally of deception within the intent of this subsection.
(b) The director shall disallow as an asset a deposit, fund, or other asset of the insurer determined after a hearing to be
(1) not in good faith the property of the insurer;
(2) not freely subject to withdrawal or liquidation by the insurer at any time for the payment or discharge of claims or other obligations arising under its policies;
(3) the result of arrangements made principally for the purpose of deception as to the insurer's financial condition as of the date of any financial statement of the insurer.
(c) A disallowance of assets or credits is not valid unless made by the director after a hearing of which notice was given the insurer within six months after the date the financial statement of the insurer in which the deception is claimed was filed with the director.
(d) The director may suspend or revoke the certificate of authority of an insurer that has knowingly been a party to a deception or an attempted deception.