Oklahoma § 36-2730.1 - Injunction, liquidation or receivership of domestic

§ 36-2730.1. Injunction, liquidation or receivership of domestic

society.

A. When the Insurance Commissioner upon investigation finds

that a domestic society:

1. Has exceeded its powers;

2. Has failed to comply with any provision of this article;

3. Is not fulfilling its contracts in good faith;

4. Has a membership of less than four hundred after an

existence of one (1) year or more; or

5. Is conducting business fraudulently or in a manner hazardous

to its members, creditors, the public or the business;

the Commissioner shall notify the society of such deficiency or

deficiencies and state in writing the reasons for his or her

Oklahoma Statutes - Title 36. Insurance

dissatisfaction. The Commissioner shall at once issue a written

notice to the society requiring that the deficiency or deficiencies

be corrected. After such notice, the society shall have a thirtyday period in which to comply with the Commissioner's request for

correction. If the society fails to comply with such request, the

Commissioner shall notify the society of such findings of

noncompliance and require the society to show cause on a date named

why it should not be enjoined from carrying on any business until

the violation complained of shall have been corrected, or why an

action in the nature of quo warranto should not be commenced against

the society.

B. If on such date the society does not present good and

sufficient reasons why it should not be so enjoined or why such

action should not be commenced, the Commissioner may present the

facts relating thereto to the Attorney General who shall, if he or

she deems the circumstances warrant, commence an action to enjoin

the society from transacting business or an action in the nature of

quo warranto.

C. The court shall thereupon notify the officers of the society

of a hearing. If, after a full hearing, it appears that the society

should be so enjoined or liquidated or a receiver appointed, the

court shall enter the necessary order. No society so enjoined shall

have the authority to do business until:

1. The Commissioner finds that the violation complained of has

been corrected;

2. The costs of such action shall have been paid by the society

if the court finds that the society was in default as charged;

3. The court has dissolved its injunction; and

4. The Commissioner has reinstated the certificate of

authority.

D. If the court orders the society liquidated, it shall be

enjoined from carrying on any further business, whereupon the

receiver of the society shall proceed at once to take possession of

the books, papers, money and other assets of the society and, under

the direction of the court, proceed forthwith to close the affairs

of the society and to distribute its funds to those entitled.

E. No action under this section shall be recognized in any

court of this state unless brought by the Attorney General upon

request of the Commissioner. Whenever a receiver is to be appointed

for a domestic society, the court shall appoint the Commissioner as

the receiver.

F. The provisions of this section relating to hearing by the

Commissioner, action by the Attorney General at the request of the

Commissioner, hearing by the court, injunction and receivership

shall be applicable to a society which shall voluntarily determine

to discontinue business.

Added by Laws 1992, c. 76, § 30, eff. Jan. 1, 1993.

Oklahoma Statutes - Title 36. Insurance