Method of determining financial condition

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In determining the financial condition of a reciprocal insurer, the Insurance Commissioner shall apply the following rules:

  1. (1) He or she shall charge as liabilities the same reserves as are required of incorporated insurers issuing nonassessable policies on a reserve basis;

  2. (2) The surplus deposits of subscribers shall be allowed as assets, except that any premium deposits delinquent for ninety (90) days shall first be charged against the surplus deposit;

  3. (3) The surplus deposits of subscribers shall not be charged as a liability;

  4. (4) All premium deposits delinquent less than ninety (90) days shall be allowed as assets;

  5. (5) An assessment levied upon subscribers, and not collected, shall not be allowed as an asset;

  6. (6) The contingent liability of subscribers shall not be allowed as an asset; and

  7. (7) The computation of reserves shall be based upon premium deposits other than membership fees and without any deduction for expenses and the compensation of the attorney.


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