Hawaii Administrative Rules
Title 16 - DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS
Chapter 14 - INSURANCE HOLDING COMPANY SYSTEM
Section 16-14-10 - Extraordinary dividends and other distributions
Universal Citation: HI Admin Rules 16-14-10
Current through August, 2024
(a) Requests to the commissioner for approval of extraordinary dividends or any other extraordinary distribution to shareholders shall include the following:
(1) The amount of the proposed
dividend;
(2) The date established
for payment of the dividend;
(3) A
statement as to whether the dividend is to be in cash or other property and, if
in property, a description of the property, its cost, and its fair market
value, together with an explanation of the basis for the valuation;
(4) A copy of the calculations determining
that the proposed dividend is extraordinary, including:
(A) The amounts, dates, and form of payment
of all dividends or distributions (including regular dividends but excluding
distributions of the insurer's own securities) paid during the previous twelve
consecutive months;
(B) Surplus as
regards policyholders (total capital and surplus) as of the preceding December
31;
(C) If the insurer is not a
life insurer, the net income less realized capital gains for the twelve month
period ending on the preceding December 31 and the two preceding twelve month
periods; and
(D) If the insurer is
not a life insurer, the dividends paid to stockholders, excluding distributions
of the insurer's own securities in the preceding two calendar years;
(5) A balance sheet and statement
of income for the period between the last annual statement filed with the
commissioner and the end of the month preceding the month in which the request
for dividend approval is submitted; and
(6) A brief statement as to the effect of the
proposed dividend upon the insurer's surplus, the reasonableness of the surplus
in relation to the insurer's outstanding liabilities, and the adequacy of the
surplus relative to the insurer's financial needs.
(b) Subject to section 431:11-106(b), HRS, no insurer shall pay any extraordinary dividend or make any other distribution to its shareholders until:
(1)
Thirty days after the commissioner has received notice of the declaration
thereof and has not within the period disapproved the payment; or
(2) The commissioner shall have approved the
payment within the thirty-day period.
(c) An insurer shall report to the commissioner all dividends and other distributions to shareholders made pursuant this section and section 431:11-106, HRS, within fifteen days following the payment.
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