2011 Florida Statutes
Grounds for rehabilitation; domestic insurers.
Grounds for rehabilitation; domestic insurers.
631.051 Grounds for rehabilitation; domestic insurers.—The department may petition for an order directing it to rehabilitate a domestic insurer or an alien insurer domiciled in this state on any one or more of the following grounds, that the insurer:
(1) Is impaired or insolvent;
(2) Has failed to comply with an order of the office to make good an impairment of capital or surplus or both;
(3) Is found by the office to be in such condition or is using or has been subject to such methods or practices in the conduct of its business, as to render its further transaction of insurance presently or prospectively hazardous to its policyholders, creditors, stockholders, or the public;
(4) Has failed, or its parent corporation, subsidiary, or affiliated person controlled by either the insurer or the parent corporation has failed, to submit its books, documents, accounts, records, and affairs pertaining to the insurer to the reasonable inspection or examination of the office or its authorized representative; or any individual exercising any executive authority in the affairs of the insurer, or parent corporation, or subsidiary, or affiliated person has refused to be examined under oath by the office or its authorized representative, whether within this state or otherwise, concerning the pertinent affairs of the insurer, or parent corporation or subsidiary or affiliated person; or if examined under oath refuses to divulge pertinent information reasonably known to her or him; or officers, directors, agents, employees, or other representatives of the insurer or parent corporation, subsidiary, or affiliated person have failed to comply promptly with the reasonable requests of the office or its authorized representative for the purposes of, and during the conduct of, any such examination;
(6) Through its board of directors or governing body is deadlocked in the management of the insurer’s affairs and that the members of a mutual, reciprocal, or any other type of organization or stockholders are unable to break the deadlock and that irreparable injury to the insurer, its creditors, its policyholders, its members or subscribers, or the public is threatened by reason thereof;
(7) Has transferred or attempted to transfer substantially its entire property or business, or has entered into any transaction the effect of which is to merge substantially its entire property or business into that of any other insurer or entity without having first obtained the written approval of the office under the provisions of s. 628.451, s. 628.461, or s. 628.4615, as the case may be;
(8) Has willfully violated its charter or certificate of incorporation or any law of this state;
(9) Is in such a position that control of it, whether by stock ownership or otherwise, and whether direct or indirect, is in one or more persons found by the office after notice and hearing to be dishonest or untrustworthy; or that the insurer has failed, upon order of the office and expiration of such reasonable time for such removal as the office shall specify in the order, to remove any person who in fact has executive authority, directly or indirectly, in the insurer, whether as an officer, director, manager, agent, employee, or otherwise, and if such person has been found by the office after notice and hearing, to be incompetent, dishonest, untrustworthy, or so lacking in insurance company managerial experience as to be hazardous to the insurance-buying public;
(10) Has been or is the subject of an application for the appointment of a receiver, trustee, custodian, or sequestrator of the insurer or its property otherwise than pursuant to the provisions of this code, but only if such an appointment has been made or is imminent;
(11) Has consented to such an order through a majority of its directors, stockholders, members, or subscribers;
(12) Has failed to pay a final judgment rendered against it in this state upon any insurance contract issued or assumed by it, within 60 days after the judgment became final, within 60 days after the time for taking an appeal has expired, or within 30 days after dismissal of an appeal before final determination, whichever date is the later;
(13) Has been the victim of embezzlement, wrongful sequestration, conversion, diversion, or encumbering of its assets; forgery or fraud affecting it; or other illegal conduct in, by, or with respect to it, which if established would threaten its solvency; or that the office has reasonable cause to so believe any of the foregoing has occurred or may occur;
(14) Is engaging in a systematic practice of reaching settlements with and obtaining releases from policyholders or third-party claimants and then unreasonably delaying payment of, or failing to pay, the agreed-upon settlements; or
(15) Within the previous 12 months has systematically attempted to compromise with creditors on the ground that it is financially unable to pay its claims in full.
History.—s. 721, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 70-27; s. 1, ch. 70-439; s. 809(1st), ch. 82-243; ss. 3, 17, ch. 86-250; s. 4, ch. 87-50; s. 10, ch. 90-248; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 397, ch. 97-102; s. 1344, ch. 2003-261.