Maryland § 3-116
Full text of Maryland Maryland Code § 3-116, with citation guidance and answers to common questions.
§ 3-116.
(a) (1) A director, officer, or member of a stock insurer or mutual insurer or any other person may lend or advance to the stock insurer or mutual insurer any money necessary to enable it to comply with a surplus requirement or any other requirement of law.
(2) The instrument evidencing a loan or advance under this subsection shall:
(i) be approved as to form and content by the Commissioner; and
(ii) contain provisions that specify that:
1. the instrument is subordinate to policyholders, claimant and beneficiary claims, and all other classes of creditors other than surplus note holders; and
2. interest payments and principal repayments may not be made without prior approval of the Commissioner.
(3) A loan or advance under this subsection and any interest on it:
(i) is payable only out of the surplus remaining after the stock insurer or mutual insurer provides for all reserves and other liabilities; and
(ii) is not otherwise a liability or claim against the stock insurer or mutual insurer or any of its assets.
(b) (1) Proceeds of a loan or advance under this section shall be in the form of cash or other admitted assets having readily determinable values and liquidity satisfactory to the Commissioner.
(2) In each annual statement, a stock insurer or mutual insurer shall report the amount of each loan or advance made under this section.
Frequently Asked Questions About Maryland § 3-116
What does Maryland Code § 3-116 cover?
Section 3-116 is part of the Maryland Code, the codified statutory law of Maryland. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Maryland § 3-116?
A common citation format is "Maryland Code § 3-116" (Maryland). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Maryland law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Maryland official source linked on this page or consult a licensed Maryland attorney.
How does Maryland § 3-116 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Maryland can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Maryland.