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This entry was published on 2014-09-22
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SECTION 1603
Notice of intent to acquire or divest
Insurance (ISC) CHAPTER 28, ARTICLE 16
§ 1603. Notice of intent to acquire or divest. (a) A domestic insurer
shall not acquire control of any other domestic insurer, whether by
purchase of its securities or otherwise, unless:

(1) a notice of intention of such proposed acquisition shall have been
filed with the superintendent not less than ninety days, or such shorter
period as may be permitted by the superintendent, in advance of such
proposed acquisition; and

(2) the insurer receives the superintendent's prior approval.

(b) The superintendent shall disapprove such acquisition if the
superintendent determines that the proposed acquisition is contrary to
law or determines that such proposed acquisition would be contrary to
the best interests of the parent insurer's policyholders or of the
people of this state. Only the following factors shall be considered in
making the foregoing determination:

(1) the availability of the funds or assets required for such
acquisition;

(2) the fairness of any exchange of shares, assets, cash or other
consideration for the shares or assets to be received;

(3) the impact of the new operation on the parent insurer's surplus
and existing insurance business and the risks inherent in the parent
insurer's investment portfolio and operations;

(4) the fairness and adequacy of the financing proposed for the
subsidiary;

(5) the likelihood of undue concentration of economic power;

(6) whether the effect of the acquisition may be substantially to
lessen competition in any line of commerce in insurance or to tend to
create a monopoly therein; and

(7) whether the acquisition might result in an excessive proliferation
of subsidiaries that would tend to unduly dilute management
effectiveness or weaken financial strength, or otherwise be contrary to
the best interests of the parent insurer's policyholders or of the
people of this state.

(c) At any time after an acquisition the superintendent may order its
disposition if the superintendent finds, after notice and an opportunity
to be heard, that its continued retention is hazardous or prejudicial to
the interests of the parent insurer's policyholders.

(d) Any domestic insurer seeking to divest its controlling interest in
another domestic insurer, in any manner, shall file with the
superintendent, with a copy to the insurer, notice of its proposed
divestiture at least thirty days prior to the cessation of control.

(e) The contents of each notice of intention of a proposed acquisition
or divestiture filed hereunder and information pertaining thereto shall
be kept confidential, shall not be subject to subpoena and shall not be
made public unless after notice and opportunity to be heard the
superintendent determines that the interests of policyholders,
shareholders or the public will be served by publication.