AS Title 21, Chapter 22: Insurance Holding Companies

Chapter 22. Insurance Holding Companies. Sec. 21.22.010. Filing requirements for acquisition of control of or merger with domestic insurer. (a) Until the provisions of (b) of this section have been fulfilled, a person may not (1) unless the person is an issuer, make a tender or an offer for or a request or an invitation for tenders of, or enter into any agreement to exchange securities for, seek to acquire, or acquire, in the open market or otherwise, any voting security of a domestic insurer if, after the purchase, the person would, directly or indirectly or by conversion or by exercise of any right to acquire, be in control of the insurer; or (2) enter into an agreement to merge with or otherwise to acquire control of a domestic insurer or a person controlling a domestic insurer. (b) A statement containing the information required by AS 21.22.020 shall be filed by the person making a proposal described in (a) of this section with the director before the time copies of the proposal are first published, sent, or given to security holders of the insurer. The insurer shall publish, send, or give copies of the statement to the insurer's stockholders. The proposal is subject to approval by the director under AS 21.22.030 . (c) If a proposal described in (a) of this section is to be made by means of a registration statement under 15 U.S.C. 77a — 77aa (Securities Act of 1933) or in circumstances requiring the disclosure of similar information under 15 U.S.C. 78a — 78mm (Securities Exchange Act of 1934), or under a state law requiring similar registration or disclosure, the person required to file the statement under (b) of this section may use those documents in furnishing the information called for by that statement. (d) If the person required to file the statement under (b) of this section is a partnership, limited partnership, syndicate, or other group, the director may require that the information be given with respect to each (1) partner of the partnership or limited partnership; (2) member of the syndicate or group; and (3) person who controls a partner or member. (e) If any person, partner, or member required to file the statement under (b) of this section is a corporation, the director may require that the information be given with respect to (1) that corporation; (2) each officer and director of that corporation; and (3) each person who is directly or indirectly the beneficial owner of more than 10 percent of the outstanding voting securities of that corporation. (f) If any material change occurs in the facts set out in the statement filed with the director and sent to the insurer under this section, an amendment setting out the change, together with copies of all documents and other material relevant to the change, shall be filed with the director and sent to the insurer within two business days after the person learns of the change. The insurer shall send the amendment to its shareholders. (g) The provisions of this section do not apply to an offer, request, invitation, agreement, or acquisition that the director by order may exempt as not having been made or entered into for the purpose and not having the effect of changing or influencing the control of the domestic insurer. (h) A person controlling a domestic insurer seeking to divest, in any manner, its controlling interest in the domestic insurer shall file with the director, and provide a copy to the insurer, confidential notice of the person's proposed divestiture at least 30 days before the cessation of control. The director shall determine whether a party seeking to divest or to acquire a controlling interest in an insurer is required to file for and obtain approval of the transaction. The information is confidential until the conclusion of the transaction unless the director, in the director's discretion, determines that confidential treatment will interfere with enforcement of this section. If a statement referred to in (b) of this section is otherwise filed, this subsection does not apply. (i) For a transaction subject to this section, an acquiring person also shall file a preacquisition notification with the director that contains the information set out in AS 21.22.065 (c). A failure to file the notification may be subject to penalties specified in AS 21.22.065 (i). (j) In this section, “domestic insurer” includes any person controlling a domestic insurer unless that person is either directly or through its affiliates primarily engaged in business other than the business of insurance. In this subsection, “person” includes a securities broker holding, in the usual and customary broker's function, more than 20 percent of the voting securities of an insurer or of a person controlling an insurer. Sec. 21.22.020. Content of statement for acquisition or merger filing. (a) The statement to be filed with the director under AS 21.22.010 shall be made under oath or affirmation and must contain the following information: (1) the name and address of each person by whom or on whose behalf the merger or other acquisition of control referred to in AS 21.22.010 is to be effected, who will be called the “acquiring party,” as follows: (A) if the person is an individual, the principal occupation of the person and all offices and positions held during the past five years, and all felony convictions and misdemeanor convictions involving moral turpitude during the past 10 years; (B) if the person is not an individual, (i) a report of the nature of its business operations during the past five years or for whatever lesser period the person and any of its predecessors have been in existence; (ii) an informative description of the business intended to be done by the person and the person's subsidiaries; and (iii) a list of all individuals who are or who have been selected to become directors or executive officers of the person, or who perform or will perform functions appropriate to those positions; the list shall include for each individual under this sub-subparagraph the information required by (A) of this paragraph; (2) a description of the consideration used or to be used in effecting the merger or other acquisition of control, including (A) the source, nature, and amount; (B) a description of any transaction in which funds were or are to be obtained for a purpose under this paragraph; and (C) the identity of persons furnishing the consideration; however, if a source of the consideration is a loan made in the lender's ordinary course of business, the director shall keep the identity of the lender confidential, if the person filing the statement so requests; (3) fully audited financial information as to the earnings and financial condition of each acquiring party for the preceding five fiscal years or for whatever lesser period that an acquiring party and any predecessors of the acquiring party have been in existence, and similar unaudited information as of a date not earlier than 90 days before the filing of the statement; (4) any plans or proposals that each acquiring party may have to (A) liquidate the insurer; (B) sell its assets or merge or consolidate it with any person; or (C) make any other material change in its business or corporate structure or management; (5) the number of shares of any security referred to in AS 21.22.010 that each acquiring party proposes to acquire, the terms of the offer, request, invitation, agreement, or acquisition referred to in this chapter, and a statement as to the method by which the fairness of the proposal was determined; (6) the amount of each class of any security referred to in AS 21.22.010 that is beneficially owned or concerning which there is a right to acquire beneficial ownership by each acquiring party; (7) a full description of any contracts, arrangements, or understandings with respect to any security referred to in AS 21.22.010 in which an acquiring party is involved, including transfer of any of the securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or guarantees of profits, division of losses or profits, or the giving or withholding of proxies; this description must identify the persons with whom the contracts, arrangements, or understandings have been entered into; (8) a description of the purchase of any security referred to in AS 21.22.010 during the 12 calendar months preceding the filing of the statement by an acquiring party, including the dates of purchase, the names of the purchasers, and consideration paid or agreed to be paid; (9) a description of any recommendations to purchase a security referred to in AS 21.22.010 made during the 12 calendar months preceding the filing of the statement by an acquiring party or by anyone based on interviews or at the suggestion of the acquiring party; (10) copies of all tender offers for, requests or invitations for tenders of exchange offers for, and agreements to acquire or exchange any securities referred to in AS 21.22.010 and, if distributed, of additional soliciting material; (11) the terms of any agreement, contract, or understanding made with a broker-dealer as to solicitation of securities referred to in AS 21.22.010 for tender and the amount of any fees, commissions, or other compensation to be paid to a broker-dealer; (12) any additional information as the director may by order or regulation prescribe as necessary or appropriate for the protection of policyholders and security holders of the insurer or in the public interest. (b) In addition to the other requirements in this section, a person required to file a statement under AS 21.22.010 shall provide (1) the annual enterprise risk statement specified in AS 21.22.060 (n) for so long as control exists; and (2) an acknowledgment that the person and all subsidiaries within the person's control in the insurance holding company system will provide information to the director upon request as necessary to evaluate enterprise risk to the insurer. (c) In this section, “consideration” includes a pledge of the stock of an insurer or the insurer's subsidiary. Sec. 21.22.030. Hearing, findings, and approval. (a) The director shall approve a merger or other acquisition of control referred to in AS 21.22.010 unless, after a public hearing, the director finds that (1) after the change of control, the domestic insurer referred to in AS 21.22.010 would not be able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed; (2) the effect of the merger or other acquisitions of control would be substantially to lessen competition in insurance in this state or tend to create a monopoly in this state; (3) the financial condition of an acquiring party is such that it might jeopardize the financial stability of the insurer or prejudice the interest of its policyholders or the interests of any remaining securityholders who are unaffiliated with the acquiring party; (4) the terms of the offer, request, invitation, agreement, or acquisition referred to in AS 21.22.010 are unfair and unreasonable to the securityholders of the insurer; (5) the plans or proposals that the acquiring party has to liquidate the insurer, sell its assets, or consolidate or merge it with any person, or to make any other material change in its business or corporate structure or management, are unfair and unreasonable to policyholders of the insurer and not in the public interest; (6) the competence, experience, and integrity of those persons who would control the operation of the insurer are such that it would not be in the interest of policyholders of the insurer and of the public to permit the merger or other acquisition of control; or (7) the acquisition is likely to be hazardous or prejudicial to the insurance-buying public. (b) The public hearing referred to in (a) of this section must be held within 60 days after the statement required by AS 21.22.010 is filed and determined to be complete by the director. The director shall give notice of at least 20 days of the hearing to the person filing the statement. The person filing the statement shall give notice of at least seven days of the hearing to the insurer and to other persons as may be designated by the director. The director shall issue a decision within the 60-day period preceding the effective date of the proposed transaction. The procedure in AS 21.06.210 applies to a public hearing under this section. (c) In evaluating the effect of a merger or other acquisition under (a)(2) of this section, the (1) information requirements of AS 21.22.065 (c)(1) and the standards of AS 21.22.065 (d)(1), (2), and (e) apply; (2) merger or other acquisition may not be disapproved if the director finds that a situation meeting the criteria in AS 21.22.065 (g) exists; and (3) director may condition the approval of the merger or other acquisition on the removal of a basis for disapproval within a specified period. (d) The director may retain at the acquiring person's expense an attorney, actuary, accountant, or other expert not otherwise a part of the director's staff, if reasonably necessary to assist the director in reviewing the proposed acquisition of control. (e) If the proposed acquisition of control would require the approval of more than one insurance regulator, the public hearing referred to under (a) and (b) of this section may be held on a consolidated basis upon request of the person filing the statement referred to in AS 21.22.010 . That person shall file the statement referred to in AS 21.22.010 with the National Association of Insurance Commissioners within five days after making the request for a public hearing. The director may opt out of a consolidated hearing and shall provide notice to the applicant of the opt-out within 10 days after receipt of the statement referred to in AS 21.22.010 . A hearing conducted on a consolidated basis must be public and must be held within the United States before the insurance regulators of the states in which the insurers are domiciled. The director may attend the hearing in person or telephonically. Sec. 21.22.040. Mailings to shareholders and expenses. All statements, amendments, or other material filed under AS 21.22.010 , and all notices of public hearings held under AS 21.22.030 , shall be mailed by the insurer to its shareholders within five business days after the insurer has received those statements, amendments, other materials, or notices. The expenses of mailing shall be borne by the person making the filing. As security for the payment of those expenses, the person making the filing shall file with the director an acceptable bond or other deposit in an amount to be determined by the director. Sec. 21.22.050. Jurisdiction and consent to service. The courts of this state are given jurisdiction over every person not resident, domiciled, or authorized to do business in this state who files a statement with the director under this chapter and over all actions involving that person arising out of violations of this chapter, and each person is considered to have performed acts equivalent to and constituting an appointment of the director to be the lawful attorney of the person upon whom may be served all lawful process in any action or proceeding arising out of a violation of this chapter. Copies of all lawful process shall be transmitted by registered or certified mail by the director to the person at the last known address of the person. Sec. 21.22.060. Registration required. (a) Except as provided in (c) of this section, an insurer that is authorized to do business in this state and that is a member of an insurance holding company system shall register with the director. An insurer that is subject to registration under this section shall register not later than 15 days after the insurer becomes subject to registration, unless the director, for good cause shown, extends the time for registration; if the time is extended, the insurer shall register within the extended time. (b) An insurer subject to registration shall file a registration statement, on a form provided by the director, that must contain current information about (1) the capital structure, general financial condition, ownership, and management of the insurer and any person controlling the insurer; (2) the identity and relationship of every member of the insurance holding company system; (3) the following agreements in force and transactions currently outstanding or that have occurred in the last calendar year between the insurer and its affiliates: (A) loans, other investments, or purchases, sales, or exchanges of securities of the affiliates by the insurer or of the insurer by its affiliates; (B) purchases, sales, or exchanges of assets; (C) transactions not in the ordinary course of business; (D) guarantees or undertakings for the benefit of an affiliate that result in an actual contingent exposure of the insurer's assets to liability, other than insurance contracts entered into in the ordinary course of the insurer's business; (E) all management and service contracts and all cost-sharing arrangements; (F) reinsurance agreements; (G) dividends and other distributions to shareholders; and (H) consolidated tax allocation agreements; (4) other matters concerning transactions between registered insurers and any affiliates that may be included from time to time in a registration form adopted or approved by the director; (5) a pledge of the insurer's stock, including stock of a subsidiary or controlling affiliate, for a loan made to a member of the insurance holding company system; (6) if requested by the director, the financial statements of or within an insurance holding company system, including all affiliates or the most recently filed parent corporation financial statements that have been filed with the United States Securities and Exchange Commission; financial statements may include annual audited financial statements filed with the United States Securities and Exchange Commission under 15 U.S.C. 77a — 77aa (Securities Act of 1933), as amended, or 15 U.S.C. 78a — 78pp (Securities Exchange Act of 1934), as amended; (7) statements that the insurer's board of directors is responsible for and oversees corporate governance and internal controls and that the insurer's officers or senior management have approved, implemented, and continue to maintain and monitor corporate governance and internal control procedures; and (8) other information required by the director by regulation. (c) An authorized insurer is not required to register under (a) of this section if the insurer is a member of a holding company system subject to registration requirements and standards under the laws or regulations of its state of domicile that are substantially similar to those contained in this chapter, except that the director may require the insurer to file a copy of the registration statement, the summary outline as described in (l) of this section, or other information filed in its state of domicile. (d) Information need not be disclosed on the registration statement filed under (b) of this section if that information is not material for the purposes of this section. Unless the director by regulation or order provides otherwise, sales, purchases, exchanges, loans or extensions of credit, investments, or the aggregate of a series of related transactions, involving one-half of one percent or less of an insurer's admitted assets or five percent or less of the policyholder's surplus as of the 31st day of December of the calendar year in which the transaction took place are not considered material for purposes of this section. (e) Each registered insurer shall keep current the information required to be disclosed in its registration statement by reporting all material changes or additions on amendment forms provided by the director within 30 days after the end of the month in which it learns of each change or addition; however, subject to AS 21.22.100 , each registered insurer shall report all dividends and other distributions to shareholders within 15 business days following their declaration. (f) The director shall terminate the registration of an insurer that demonstrates that it no longer is a member of an insurance holding company system. (g) The director may require or allow two or more affiliated insurers subject to registration under this section to file a consolidated registration statement or consolidated reports amending their consolidated registration statement or their individual registration statements. (h) The director may allow an insurer that is authorized to do business in this state and that is part of an insurance holding company system to register on behalf of an affiliated insurer that is required to register under (a) of this section and to file all information and material required to be filed under this section. (i) This section does not apply to any insurer, information, or transaction to the extent that the director by regulation or order exempts the insurer, information, or transaction from this section. (j) A person may file with the director a disclaimer of affiliation with an authorized insurer or the disclaimer may be filed by the insurer or a member of an insurance holding company system. The disclaimer must fully disclose all material relationships and bases for affiliation between that person and that insurer as well as the basis for disclaiming the affiliation. A disclaimer of affiliation is considered granted unless the director, within 30 days after receipt of a complete disclaimer, notifies the disclaiming party that the disclaimer is disallowed. If the disclaimer is disallowed, the disclaiming party may request a hearing under AS 21.06.180 — 21.06.240. (k) An insurer subject to registration under (a) of this section shall register annually by May 1 of each year for the previous calendar year unless, for good cause shown, the director extends the time for registration. The director may require an insurer that is allowed to register as provided under (c) of this section to furnish a copy of (1) the registration statement; (2) the summary specified in (l) of this section; or (3) other information filed by the insurer with the insurance regulatory authority of the insurer's state of domicile. (l) An annual registration statement filed under (k) of this section must contain a summary outline of items in the current registration statement representing changes from the prior registration statement. (m) A person within an insurance holding company system subject to registration shall provide complete and accurate information to an insurer, where the information is reasonably necessary to enable the insurer to comply with the provisions of this chapter. (n) The ultimate controlling person of an insurer subject to registration shall file an annual enterprise risk report. The report must, to the best of the ultimate controlling person's knowledge and belief, identify the material risks within the insurance holding company system that may pose enterprise risk to the insurer. The report shall be filed with the lead state insurance regulator of the insurance holding company system as determined by the procedures in the Financial Analysis Handbook adopted by the National Association of Insurance Commissioners. Sec. 21.22.065. Acquisitions involving change of control. (a) Unless exempted in (j) of this section, this section applies to any acquisition in which there is a change in control of an insurer authorized to do business in this state. (b) If an acquisition violates the standards established in (d) and (f) of this section, the director may enter an order requiring an involved insurer to cease doing business in this state with respect to the line or lines of insurance involved in the violation or denying the application of an acquired or acquiring insurer for a license to do business in this state. Within 30 days of the issuance of the order, the involved insurer may submit a plan to remedy the anticompetitive effect of the acquisition within a reasonable time. Based upon a plan or other information submitted, the director shall specify the conditions, if any, under a time period during which the aspects of the acquisition causing a violation of the standards of this section would be remedied and the order vacated or modified. The order is stayed by the insurer's submission of a plan and shall be rescinded if the acquisition is not consummated. (c) An acquisition that meets the requirements under (a) of this section is subject to an order under (b) of this section unless the acquiring person files a preacquisition notification and the waiting period has expired. The person to be acquired may file a preacquisition notification. A preacquisition notification by a person to be acquired may not be filed in place of a preacquisition filing by an acquiring person. The preacquisition notification (1) must be in a form and contain the information prescribed in regulations adopted by the director relating to insurance markets that, under (j)(5) of this section, cause the acquisition not to be exempt from the provisions of this section; the director may require additional material and information the director considers necessary to determine whether the proposed acquisition, if consummated, would violate the competitive standards of this section; (2) may include an opinion of an economist regarding the competitive effect of the acquisition in this state accompanied by a summary of the education and experience indicating the economist's ability to render an informed opinion; and (3) must be followed by a waiting period beginning on the date of receipt by the director of a preacquisition notification and ending on the earlier of the 30th day after the date of receipt or termination of the waiting period by the director unless, before the end of the waiting period, the director requires the submission of additional information relevant to the proposed acquisition, in which event the waiting period shall end on the 30th day after receipt of the additional information by the director or termination of the waiting period by the director, whichever is earlier. (d) The director may enter an order under (b) of this section regarding an acquisition if the insurer fails to file adequate information in compliance with (c) of this section or if there is substantial evidence that the acquisition may substantially lessen competition, create a monopoly in a line of insurance in this state or significantly increase an insurer's market concentration. In determining whether an acquisition violates competitive standards under this subsection, the director shall consider the following: (1) an acquisition covered under (a) of this section involving two or more insurers competing in the same market is prima facie evidence of a violation of the competitive standards (A) if the market is highly concentrated and the involved insurers possess the following shares of the market: Insurer AInsurer B 4 percent4 percent or more 10 percent2 percent or more 15 percent1 percent or more; (B) if the market is not highly concentrated and the involved insurers possess the following shares of the market: Insurer AInsurer B 5 percent5 percent or more 10 percent4 percent or more 15 percent3 percent or more 19 percent1 percent or more. (2) an acquisition covered under (a) of this section involving two or more insurers competing in the same market is prima facie evidence of violation of the competitive standard if (A) there is a significant trend toward increased concentration in the market, which occurs when the aggregate market share of any grouping of the largest insurers in the market, from the two largest to the eighth largest, has increased by seven percent or more of the market over a period extending from any base year five to 10 years before the acquisition up to the date of the acquisition; (B) one of the insurers involved is an insurer in a grouping of large insurers showing the requisite increase in market share; and (C) another involved insurer's market share is two percent or more. (e) A percentage not shown in the tables contained in (d) of this section may be interpolated proportionately to the percentage that is shown. The insurer with the largest share of the market shall be considered Insurer A. If more than two insurers are involved, a market share that exceeds the total of the two columns in the table by the insurers involved is prima facie evidence of a violation of the competitive standards contained in (d) of this section. (f) Even though an acquisition does not violate the competitive standard under (d) of this section, the director may establish the requisite anticompetitive effect based upon other substantial evidence. Even though an acquisition does violate the competitive standard under (d) of this section, a party may establish the absence of the requisite anticompetitive effect based upon other substantial evidence. Relevant factors in making a determination under (d) of this section include market shares, volatility of ranking of market leaders, number of competitors, concentration, trend of concentration in the industry, and ease of entry into and exit out of the market. The burden of showing substantial evidence of a violation of the competitive standards rests with the director. (g) An order may not be entered under (b) of this section if (1) the acquisition will yield substantial economy of scale or economy in resource utilization that cannot be achieved in another way and the public benefits that would arise from the economy exceed the public benefits that would arise from not lessening competition; or (2) the acquisition will substantially increase the availability of insurance and the public benefits of the increase exceed the public benefits that would arise from not lessening competition. (h) A person who violates a cease and desist order of the director under (b) of this section may, after hearing and on order of the director, be subject to the suspension or revocation of a license, a civil penalty not to exceed $10,000 for each day of violation, or both. (i) An insurer or other person who fails to make a preacquisition filing required by (c) of this section and who also fails to demonstrate a good faith effort to comply with filing requirements shall be subject to a fine of not more than $50,000. (j) This section does not apply to (1) an acquisition subject to approval or disapproval by the director under AS 21.22.010 ; (2) a purchase of securities solely for investment purposes if the securities are not used by voting or otherwise to cause or attempt to cause the substantial lessening of competition in an insurance market in this state; if a purchase of securities for investment purposes results in a presumption of control under AS 21.22.200 (3), it is not solely for investment purposes unless the insurance supervisory official of the insurer's state of domicile accepts a disclaimer of control or affirmatively finds that control does not exist and the disclaimer action or affirmative finding is communicated by the domiciliary insurance supervisory official to the director; (3) the acquisition of a person by another person resulting in a change of control of an insurer when both persons are neither directly nor through affiliates primarily engaged in the business of insurance if preacquisition notification is filed with the director under (c) of this section 30 days before the proposed effective date of the acquisition; however, the preacquisition notification is not required for exclusion if the acquisition would otherwise be excluded under this subsection; (4) the acquisition of an already affiliated person; (5) an acquisition if, as an immediate result of the acquisition, (A) the combined market share of the involved insurers would not exceed five percent of a market; (B) there would not be an increase in a market share of the larger writer; or (C) the combined market share of the involved insurers would not exceed 12 percent of a market and the market share of the larger writer would not increase by more than two percent of a market; (6) an acquisition for which a preacquisition notification would be required under this section due solely to the resulting effect on the ocean marine insurance line of business; or (7) an acquisition of an insurer whose domiciliary supervisory insurance official affirmatively finds that the insurer is in a failing condition, there are no feasible alternatives to improving this condition, the public benefits of improving the insurer's condition through the acquisition exceed the public benefits that would arise from not lessening competition, and these findings are communicated by the domiciliary supervisory insurance official to this state's director. (k) AS 21.22.150 , 21.22.160, and 21.22.180 do not apply to acquisitions covered under this section. Sec. 21.22.070. Review by director. If at any time the director determines that any material transaction entered into between an insurer and any of its affiliates does not meet the standards set out in AS 21.22.080 , the director may, after hearings conducted in accordance with AS 21.06 , require the insurer and the affiliate to terminate, set aside, or modify the transaction as considered appropriate by the director to make the transaction conform to those standards. An insurer may submit a proposed material transaction to the director for review and the director may issue an opinion that the transaction meets the standard set out in AS 21.22.080 . The opinion creates a rebuttable presumption that neither the insurer, director, officer, employee, nor agent committed a wilful violation of this chapter by entering into the transaction. The opinion does not prohibit the director from subsequently exercising authority under this section. Sec. 21.22.080. Transactions within an insurance holding company system. Material transactions by registered insurers with their affiliates are subject to the following standards: (1) the terms shall be fair and reasonable; (2) charges or fees for services performed shall be reasonable; (3) expenses incurred and payment received shall be allocated to the insurer in conformity with customary insurance accounting practices consistently applied; (4) the books, accounts, and records of each party to the transactions shall be maintained so as to disclose clearly and accurately the nature and details of the transactions including accounting information that is necessary to support the reasonableness of the charges or fees to the respective parties; (5) the insurer's surplus as regards policyholders following any dividends or distributions to shareholder affiliates or performance under a material transaction with an affiliate shall be reasonable in relation to the insurer's outstanding liabilities and adequate to its financial needs; and (6) agreements for cost-sharing services and management must include the provisions required by regulations adopted by the director. Sec. 21.22.085. Transactions involving a domestic insurer requiring director review. (a) Transactions involving a domestic insurer and a person in its insurance holding company system, including amendments or modifications of affiliate agreements previously filed under AS 21.22.080 that are subject to a materiality standard in (1) — (7) of this subsection, may not be entered into unless the insurer has notified the director in writing of the insurer's intention to enter into the transaction at least 30 days before the transaction, or a shorter period if allowed by the director, and the director has not disapproved the transaction within the required notice period. The notice of amendments or modifications must include the reasons for the change and the financial effect on the domestic insurer. A domestic insurer shall provide to the director notice, within 30 days after a termination of a previously filed agreement, for determination of the type of filing required, if any. The requirements in this section apply to the following transactions: (1) a sale, purchase, exchange, loan or extension of credit, or investment, provided the transaction is equal to or exceeds (A) with respect to insurers other than life insurers, the lesser of three percent of the insurer's admitted assets or 25 percent of surplus that pertains to policyholders, as of December 31 of the previous calendar year; or (B) with respect to life insurers, three percent of the insurer's admitted assets as of December 31 of the previous calendar year; (2) a loan or extension of credit to a person who is not an affiliate, where the insurer makes loans or extensions of credit with the agreement or understanding that the proceeds of the transaction, in whole or in substantial part, are to be used to make a loan or extension of credit to, purchase an asset of, or make an investment in an affiliate of the insurer making the loan or extension of credit, provided the transaction is equal to or exceeds (A) with respect to insurers other than life insurers, the lesser of three percent of the insurer's admitted assets or 25 percent of surplus that pertains to policyholder surplus, as of December 31 of the previous calendar year; or (B) with respect to life insurers, three percent of the insurer's admitted assets as of December 31 of the previous calendar year; (3) a reinsurance agreement or modification, including (A) a reinsurance pooling agreement; (B) an agreement in which the reinsurance premium or change in the insurer's liabilities, or the projected reinsurance premium or a change in the insurer's liabilities in any of the three years after entering into the agreement or modification, equals or exceeds five percent of surplus that pertains to policyholders as of December 31 of the previous calendar year, including an agreement that may require as consideration the transfer of assets from an insurer to a nonaffiliate if an agreement or understanding exists between the insurer and nonaffiliate that a portion of the assets will be transferred to one or more affiliates of the insurer; (4) a management agreement, service contract, tax allocation agreement, guarantee, or cost-sharing arrangement; (5) a material transaction specified by regulation that the director determines may adversely affect the interests of the insurer's policyholders; (6) a guarantee if made by a domestic insurer, except that a guarantee that is quantifiable as to amount is not subject to the notice requirements of this subsection unless it exceeds the lesser of one-half of one percent of the insurer's admitted assets or 10 percent of surplus that pertains to policyholders as of December 31 of the previous calendar year; a guarantee that is not quantifiable as to amount is subject to the notice requirements of this subsection; and (7) a direct or an indirect acquisition or investment in a person that controls an insurer or in an affiliate of the insurer in an amount that, together with the person's present holdings in the investment, exceeds two and one-half percent of surplus that pertains to policyholders; direct or indirect acquisitions or investments in subsidiaries authorized under this title or regulations adopted by the director or in nonsubsidiary insurance affiliates that are subject to the provisions of this chapter are exempt from this requirement. (b) Nothing in (a) of this section authorizes or permits a transaction that, in the case of an insurer not a member of the same holding company system, would violate a provision of law. (c) A domestic insurer may not enter into a transaction that is part of a plan or series of similar transactions with persons within the holding company system if the purpose of the separate transaction is to avoid the statutory threshold amount and avoid review that would otherwise occur. If the director determines that this separate transaction is entered into over a 12-month period for this purpose, the director may impose penalties under AS 21.22.065 (i), 21.22.170, AS 21.36.360 (a), and 21.36.910. (d) The director, in reviewing a transaction under this section, shall consider whether the transaction complies with the standards provided in AS 21.22.080 and whether the transaction may adversely affect the interests of policyholders. (e) A domestic insurer shall notify the director within 30 days of an investment of a domestic insurer in a corporation if, after the investment, the total investment by the insurance holding company system in a corporation exceeds 10 percent of the corporation's voting securities. Sec. 21.22.090. Adequacy of surplus. For the purposes of this chapter, in determining whether an insurer's surplus as regards policyholders is reasonable in relation to the insurer's outstanding liabilities and adequate to its financial needs, the following factors, among others, shall be considered: (1) the size of the insurer as measured by its assets, capital and surplus, reserves, premium writings, insurance in force, and other appropriate criteria; (2) the extent to which the insurer's business is diversified among the several lines of insurance; (3) the number and size of risks insured in each line of business; (4) the extent of the geographical dispersion of the insurer's insured risk; (5) the nature and extent of the insurer's reinsurance program; (6) the quality, diversification, and liquidity of the insurer's investment portfolio; (7) the recent past and projected future trend in the value of the insurer's investments; (8) the surplus as regards policyholders maintained by other comparable insurers; (9) the adequacy of the insurer's reserves; and (10) the quality and liquidity of investments in affiliates made under AS 21.21 ; the director may treat any such investment as a disallowed asset for purposes of determining the adequacy of surplus as regards policyholders whenever the director determines the investment warrants it. Sec. 21.22.100. Dividends and other distributions. (a) A domestic insurer may not pay any extraordinary dividend or make any other extraordinary distribution to its shareholders until (1) 30 days after the director has received notice of the declaration of the dividend or distribution and has not within that period disapproved its payment; or (2) the director has approved its payment within the 30-day period. (b) For purposes of this section, an extraordinary dividend or distribution includes a dividend or distribution of cash or other property, the fair market value of which together with that of other dividends or distributions made within the preceding 12 months exceeds the lesser of (1) 10 percent of the insurer's surplus as regards policyholders as of December 31 of the preceding year; or (2) the net gain from operations of the insurer, if the insurer is a life insurer, or the net investment income, if the insurer is not a life insurer, for the 12-month period ending December 31 of the preceding year; but does not include pro rata distributions of any class of the insurer's own securities. In determining whether a dividend or distribution is extraordinary, an insurer other than a life insurer may carry forward net income from the previous two calendar years that has not already been paid out as dividends. The carry forward provision shall be computed by taking the net income from the second and third preceding calendar years, not including realized capital gains, less dividends paid in the second and immediate preceding calendar years. (c) Notwithstanding AS 21.69.490 , an insurer may declare an extraordinary dividend or distribution that is conditional upon the director's approval. A declaration confers no rights upon shareholders until (1) the director has approved the payment of the dividend or distribution; or (2) the director has not disapproved the payment within the 30-day period referred to in (a) of this section. Sec. 21.22.105. Management of domestic insurers subject to registration. (a) Notwithstanding the control of a domestic insurer by any person, the officers and directors of the insurer may not be relieved of an obligation or liability to which the officers and directors would otherwise be subject to by law, and the insurer shall be managed so as to assure the insurer's separate operating identity consistent with this title. (b) This section does not preclude a domestic insurer from having or sharing a common management or cooperative or joint use of personnel, property, or services with one or more other persons under arrangements meeting the standards of AS 21.22.080 . Sec. 21.22.110. Examination. (a) In addition to the director's authority to examine insurers under AS 21.06.120 — 21.06.170, the director may examine an insurer registered under AS 21.22.060 and its affiliates to ascertain the financial condition of the insurer, including the enterprise risk to the insurer by the ultimate controlling party, by any entity or combination of entities within the insurance holding company system, or by the insurance holding company system on a consolidated basis. (b) The director may (1) order an insurer registered under AS 21.22.060 to produce the records, books, or other information or papers in the possession of the insurer or its affiliates that are reasonably necessary to determine compliance with this chapter; (2) order an insurer registered under AS 21.22.060 to produce information not in the possession of the insurer if the insurer can obtain access to the information under contractual relationships, statutory obligations, or other method; in the event the insurer cannot obtain the information requested by the director, the insurer shall provide the director a detailed explanation of the reason that the insurer cannot obtain the information and the identity of the holder of information; if the director determines that the detailed explanation is without merit, the director may, after notice and hearing, require the insurer to pay a penalty of $250 for each day's delay in providing the requested information, or may suspend or revoke the insurer's license; (3) in the event the insurer fails to comply with an order under this subsection, examine or issue subpoenas to the insurer's affiliates to obtain the information. (c) The director may retain, at the registered insurer's expense, attorneys, actuaries, accountants, and other experts not otherwise a part of the director's staff as may be necessary to assist in the conduct of an examination under (a) of this section. Any persons so retained are under the direction and control of the director and shall act in a purely advisory capacity. (d) Each registered insurer producing for examination records, books, and papers under (a) of this section is liable for and shall pay the expense of an examination in accordance with AS 21.06.160 . Sec. 21.22.115. Supervisory colleges. (a) With respect to an insurer registered under AS 21.22.060 , and in accordance with (c) of this section, the director may participate in a supervisory college for a domestic insurer that is part of an insurance holding company system with international operations to determine the insurer's compliance with this chapter. The director may (1) initiate the establishment of a supervisory college; (2) clarify the membership and participation of other supervisors in the supervisory college; (3) clarify the functions of the supervisory college and the role of other regulators, including the establishment of a group-wide supervisor; (4) coordinate the ongoing activities of the supervisory college, including planning meetings, supervisory activities, and processes for information sharing; and (5) establish a crisis management plan.

(b) An insurer subject to this section is liable for and shall pay the reasonable expenses of the director's participation in a supervisory college in accordance with (c) of this section, including reasonable travel expenses. Under this section, a supervisory college may be convened as either a temporary or permanent forum for communication and cooperation between the regulators charged with the supervision of the insurer or its affiliates, and the director may establish a regular assessment to the insurer for the payment of those expenses. (c) To assess the business strategy, financial position, legal and regulatory position, risk exposure, risk management, and governance processes, and as part of the examination of individual insurers in accordance with AS 21.22.110 , the director may participate in a supervisory college with other regulators charged with supervision of the insurer or its affiliates, including other state, federal, and international regulatory agencies. The director may enter into agreements in accordance with AS 21.06.060 and AS 21.22.120 to share confidential information between the director and regulatory agencies or other members of the supervisory college. (d) Nothing in this section delegates to the supervisory college the director's authority to regulate or supervise an insurer or its affiliates under this title. Sec. 21.22.117. Group-wide supervision of internationally active insurance groups. (a) The director may act as the group-wide supervisor for an internationally active insurance group in accordance with this section. However, the director may acknowledge another regulatory official as the group-wide supervisor if the internationally active insurance group (1) does not have substantial insurance operations in the United States; (2) has substantial insurance operations in the United States but not in this state; or (3) has substantial insurance operations in the United States and this state, but the director has determined under (b) or (f) of this section that the other regulatory official is the appropriate group-wide supervisor; an insurance holding company system that does not otherwise qualify as an internationally active insurance group may request that the director make a determination or acknowledgment of a group-wide supervisor under this section. (b) In cooperation with other state, federal, and international regulatory agencies, the director shall identify a single group-wide supervisor for an internationally active insurance group. The director may determine that the director is the appropriate group-wide supervisor for an internationally active insurance group that conducts substantial insurance operations concentrated in this state. However, the director may acknowledge that a regulatory official from another jurisdiction is the appropriate group-wide supervisor for the internationally active insurance group. The director shall consider the following factors when making a determination or acknowledgment under this subsection: (1) the place of domicile of the insurers within the internationally active insurance group that hold the largest share of the group's written premiums, assets, or liabilities; (2) the place of domicile of the top-tiered insurer or insurers in the insurance holding company system of the internationally active insurance group; (3) the location of the executive offices or largest operational offices of the internationally active insurance group; (4) whether another regulatory official is acting or is seeking to act as the group-wide supervisor under a regulatory system that the director determines to be (A) substantially similar to the system of regulation provided under the laws of this state; or (B) otherwise sufficient in terms of providing for group-wide supervision, enterprise risk analysis, and cooperation with other regulatory officials; and (5) whether another regulatory official acting or seeking to act as the group-wide supervisor provides the director with reasonably reciprocal recognition and cooperation; a regulatory official identified under this section as the group-wide supervisor may determine that it is appropriate to acknowledge another supervisor to serve as the group-wide supervisor; the regulatory official shall consider the factors listed in this subsection when making an acknowledgment under this subsection and shall make the acknowledgment in cooperation with, and subject to, the acknowledgment of other regulatory officials involved with supervision of members of the internationally active insurance group and in consultation with the internationally active insurance group. (c) Notwithstanding any other provision of law, when another regulatory official is acting as the group-wide supervisor of an internationally active insurance group, the director shall acknowledge that regulatory official as the group-wide supervisor. However, the director shall make a determination or acknowledgment of the appropriate group-wide supervisor for the internationally active insurance group under (b) of this section in the event of a material change in the internationally active insurance group that results in (1) the internationally active insurance group's insurers domiciled in this state holding the largest share of the group's premiums, assets, or liabilities; or (2) this state being the place of domicile of the top-tiered insurer or insurers in the insurance holding company system of the internationally active insurance group. (d) Under AS 21.22.110 , the director may collect from an insurer registered under AS 21.22.060 the information necessary to determine whether the director may act as the group-wide supervisor of an internationally active insurance group or if the director may acknowledge another regulatory official to act as the group-wide supervisor. Before issuing a determination that an internationally active insurance group is subject to group-wide supervision, the director shall notify the insurer registered under AS 21.22.060 and the ultimate controlling person within the internationally active insurance group. Upon notification, the internationally active insurance group has a minimum of 30 days to provide the director with additional information pertinent to the pending determination. The director may publish on the division's Internet website the identity of internationally active insurance groups that the director has determined are subject to group-wide supervision by the director. (e) If the director is the group-wide supervisor for an internationally active insurance group, the director may (1) assess the enterprise risks in the internationally active insurance group to ensure (A) the material financial condition and liquidity risks to members of the internationally active insurance group that are engaged in the business of insurance are identified by management; and (B) reasonable and effective mitigation measures are in place; (2) request from a member of an internationally active insurance group subject to the director's supervision information necessary and appropriate to assess enterprise risk, including information about the members of the internationally active insurance group regarding (A) governance, risk assessment, and management; (B) capital adequacy; and (C) material intercompany transactions; (3) coordinate and, through the authority of the regulatory officials of the jurisdictions where members of the internationally active insurance group are domiciled, compel development and implementation of reasonable measures designed to ensure that the internationally active insurance group is able to timely recognize and mitigate enterprise risks to members of the internationally active insurance group that are engaged in the business of insurance; (4) communicate with other state, federal, and international regulatory agencies for members in the internationally active insurance group and share relevant information subject to the confidentiality provisions under AS 21.22.120 , through supervisory colleges under AS 21.22.115 or otherwise; (5) enter into agreements with, or obtain documentation from, an insurer registered under AS 21.22.060 , a member of the internationally active insurance group, or a state, federal, or international regulatory agency for members of the internationally active insurance group, providing the basis for, or otherwise clarifying, the director's role as group-wide supervisor, including provisions for resolving disputes with other regulatory officials; the agreements or documentation may not serve as evidence in a proceeding against an insurer or person in an insurance holding company system not domiciled or incorporated in this state or doing business in this state or otherwise subject to jurisdiction in this state; and (6) perform other group-wide supervision activities, consistent with the authorities and purposes set out in this subsection. (f) If the director acknowledges that another regulatory official from a jurisdiction that is not accredited by the National Association of Insurance Commissioners is the group-wide supervisor, the director may reasonably cooperate, through supervisory colleges or otherwise, with group-wide supervision undertaken by the group-wide supervisor under the following conditions: (1) the director's cooperation is in compliance with the laws of this state; and (2) the regulatory official acknowledged as the group-wide supervisor recognizes and cooperates with the director's activities as a group-wide supervisor for other internationally active insurance groups, where applicable; if recognition and cooperation is not reasonably reciprocal, the director may refuse recognition and cooperation. (g) The director may enter into agreements with, or obtain documentation from, an insurer registered under AS 21.22.060 , an affiliate of the insurer, or other state, federal, and international regulatory agencies for members of the internationally active insurance group, that provide the basis for, or otherwise clarify, a regulatory official's role as group-wide supervisor. (h) A registered insurer subject to this section is liable for and shall pay the reasonable expenses of the director's participation in the administration of this section, including the engagement of attorneys, actuaries, and other professionals, and all reasonable travel expenses. Sec. 21.22.120. Confidentiality. (a) All information, documents, holding company analyses, insurer profile summaries, and copies of the information and documents obtained by or disclosed to the director or any other person in the course of an examination or investigation made under AS 21.22.110 and all information reported under AS 21.22.020 (b), 21.22.060, 21.22.085 — 21.22.105, and 21.22.117 and all preacquisition notification information received under AS 21.22.065 shall be given confidential treatment under AS 21.06.060 . However, if the director, after giving the insurer and its affiliates who would be affected by publication of the information notice and opportunity to be heard, determines that the interests of policyholders, shareholders, or the public will be served by the publication of the information, the director may publish all or part of the information in the manner the director considers appropriate. (b) The director may (1) share documents, materials, or other information, including the confidential information under (a) of this section, with state, federal, and international regulatory agencies, the National Association of Insurance Commissioners and its affiliates and subsidiaries, and state, federal, and international law enforcement authorities, including members of a supervisory college described in AS 21.22.115 , if the recipient agrees in writing to maintain the confidentiality of the document, material, or other information and has verified in writing the legal authority to maintain confidentiality; (2) not share confidential documents, material, or information reported under AS 21.22.060 (n) with the insurance regulator of another state, unless the statutes or regulations of the other state are substantially similar to this section and the other state has agreed in writing not to disclose the information; (3) enter into a written agreement with the National Association of Insurance Commissioners governing sharing and use of information obtained under this chapter that must (A) specify procedures and protocols regarding the confidentiality and security of information shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries under this chapter, including procedures and protocols for sharing by the National Association of Insurance Commissioners with state, federal, or international regulators; (B) specify that ownership of information shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries under this chapter remains with the director and that the National Association of Insurance Commissioners' use of the information is subject to the direction of the director; (C) require prompt notice to be given to an insurer whose confidential information in possession of the National Association of Insurance Commissioners under this chapter is subject to a request or subpoena to the National Association of Insurance Commissioners for disclosure or production; and (D) require the National Association of Insurance Commissioners and its affiliates and subsidiaries to consent to intervention by an insurer in a judicial or administrative action in which the National Association of Insurance Commissioners and its affiliates and subsidiaries may be required to disclose confidential information about the insurer shared with the National Association of Insurance Commissioners and its affiliates and subsidiaries under this chapter. (c) The director or a person who receives documents, materials, or other information while acting under the authority of the director or with whom documents, materials, or other information are shared under this chapter may not be permitted or required to testify in any private civil action concerning confidential documents, materials, or information subject to (a) of this section. (d) The sharing of information by the director under this chapter does not constitute a delegation of regulatory authority or rulemaking. The director is solely responsible for the administration, execution, and enforcement of this chapter. (e) A waiver of an applicable privilege or claim of confidentiality in the documents, materials, or information under (a) of this section may not be given as a result of disclosure to the director under this section or as a result of sharing as authorized under (b) of this section. (f) Documents, materials, or other information in the possession or control of the National Association of Insurance Commissioners under this chapter (1) are confidential by law; (2) are not subject to (A) AS 40.25.110 — 40.25.220; (B) subpoena; or (C) discovery or admissible in evidence in any private action. Sec. 21.22.130. Regulations. The director may adopt regulations to carry out the provisions of this chapter. Sec. 21.22.140. Injunctions. If it appears to the director that an insurer or a director, officer, employee, or agent of an insurer has violated or is about to violate this chapter or a regulation adopted or an order issued by the director under this chapter, the director may apply to the superior court in the judicial district in which the principal office of the insurer is located or if the insurer has no office in this state then to the superior court in the first judicial district for an order enjoining the insurer or a director, officer, employee, or agent of the insurer from the violation, and for other relief as the nature of the case and the interests of the insurer's policyholders, creditors and shareholders or the public may require. Sec. 21.22.150. Voting of certain securities prohibited. (a) A security that is the subject of any agreement or arrangement regarding acquisition, or that is acquired or to be acquired, in contravention of this chapter or a regulation adopted or an order issued by the director under this chapter may not be voted at a shareholders' meeting or be counted for quorum purposes, and any action of shareholders requiring the affirmative vote of a percentage of shares may be taken as though those securities were not issued and outstanding; but an action taken at such a meeting may not be invalidated by the voting of those securities, unless the action would materially affect control of the insurer or unless the courts of this state have so ordered. (b) If an insurer or the director has reason to believe that a security of the insurer has been or is about to be acquired in contravention of this chapter or a regulation adopted or an order issued by the director under this chapter, the insurer or the director may apply to the superior court in the first judicial district or the superior court in the judicial district in which the insurer has its principal place of business to enjoin any offer, request, invitation, agreement, or acquisition made in contravention of this chapter or a regulation adopted or an order issued by the director under this chapter, to enjoin the voting of any security so acquired, to void any vote of a security already cast at a meeting of shareholders, and for other relief as the nature of the case and the interests of the insurer's policyholders, creditors and shareholders or the public may require. (c) This section does not apply to a security that constitutes an acquisition covered by AS 21.22.065 . Sec. 21.22.160. Sequestration of voting securities. (a) If a person has acquired or is proposing to acquire voting securities in violation of this chapter or a regulation adopted or an order issued by the director under this chapter, the insurer or the director may make an application in the superior court in the first judicial district or the superior court in the judicial district in which the insurer has its principal place of business to seize or sequester any voting securities of the insurer owned directly or indirectly by that person, and the court may issue an order with respect to those securities as may be appropriate to effectuate this chapter. For the purposes of this chapter the situs of the ownership of the securities of domestic insurers is considered to be in this state. (b) This section does not apply to a security that constitutes an acquisition covered by AS 21.22.065 . Sec. 21.22.170. Civil penalties for violations. (a) An insurer failing, without just cause, to file a registration statement required under this chapter shall be required, after notice and hearing under AS 21.06.170 — 21.06.240, to pay a $200 fine for each day the insurer fails to file the registration. The maximum penalty under this subsection is $50,000. The director may reduce the penalty if the insurer demonstrates to the director that the imposition of the penalty would be a financial hardship to the insurer. (b) A director or officer of an insurance holding company system who knowingly violates, participates in, assents to, or knowingly permits an officer or agent of an insurer to engage in transactions or make investments that have not been properly reported or submitted under AS 21.22.060 , 21.22.085, or 21.22.100, or that violate this chapter, shall pay, in the director's or officer's individual capacity, a fine of not more than $50,000 for each violation, after notice and hearing under AS 21.06.170 — 21.06.240. In determining the amount of the fine, the director shall take into account the appropriateness of the fine with respect to the gravity of the violation, the history of previous violations, and other matters as justice may require. (c) If the director has reason to believe that an insurer subject to this chapter, or a director, officer, employee, or agent of the insurer, has engaged in a transaction or entered into a contract that is subject to AS 21.22.080 — 21.22.105, and that would not have been approved had the approval been requested, the director may order the insurer to cease and desist immediately any further activity under that transaction or contract. After notice and hearing under AS 21.06.170 — 21.06.240, the director may also order the insurer to void any contracts and restore the status quo if the action is in the best interest of the policyholders, creditors, or the public. (d) If the director has reason to believe that a person has committed a violation of AS 21.22.010 or 21.22.020 that prevents the full understanding of the enterprise risk to an insurer by its affiliates or by the insurance holding company system, the violation may serve as an independent basis for disapproving dividends or distributions and for placing the insurer under an order of rehabilitation in accordance with AS 21.78.090 . Sec. 21.22.175. Criminal penalties. (a) An insurer or a director, officer, employee, or agent of an insurer who knowingly violates this chapter is guilty of a class C felony. (b) A director, officer, or employee of an insurance holding company system who knowingly subscribes to or makes or causes to be made a false statement, false report, or false filing with the intent to deceive the director under this chapter is guilty of a class C felony. (c) An insurer may not pay a fine imposed by a court on a director, officer, employee, or agent that is sentenced under (a) or (b) of this section. The fine must be paid by the director, officer, employee, or agent in the director's, officer's, employee's, or agent's individual capacity. (d) In this section, “knowingly” has the meaning given in AS 11.81.900 (a). Sec. 21.22.180. Receivership. (a) If it appears to the director that a person has committed a violation of this chapter that so impairs the financial condition of a domestic insurer as to threaten insolvency or make the further transaction of business by it hazardous to its policyholders, creditors, shareholders, or the public, then the director may proceed as provided in AS 21.78 to take possession of the property of that domestic insurer and to conduct its business. (b) This section does not apply to a violation involving a security that constitutes an acquisition covered by AS 21.22.065 . Sec. 21.22.190. Revocation, suspension, or nonrenewal of insurer's authority. If the director finds, after giving notice and an opportunity to be heard, that a person has committed a violation of this chapter that makes the continued operation of an insurer contrary to the interests of its policyholders or the public, the director may suspend, revoke, or refuse to renew the insurer's license or authority to do business in this state for a period that the director finds is required for the protection of policyholders or the public. Such a determination by the director must be accompanied by specific findings of fact and conclusions of law. Sec. 21.22.200. Definitions. In this chapter, unless the context requires otherwise, (1) “acquisition” means an agreement, arrangement, or activity the consummation of which results in a person acquiring directly or indirectly the control of another person, and includes the acquisition of voting securities, assets, bulk reinsurance, and mergers; (2) “affiliate” or “affiliated” means a person who directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the persons specified; (3) “control”, “controlling”, “controlled by”, and “under common control with” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or non-management services, or otherwise, unless the power is the result of an official position with or corporate office held by the person; “control” is presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote, or holds proxies representing, 10 percent or more of the voting securities of any other person; this presumption may be rebutted by a showing made in the manner provided by AS 21.22.060 (j) that control does not exist in fact; the director may determine, after furnishing all persons in interest notice and opportunity to be heard and making specific findings of fact to support that determination, that control exists in fact, notwithstanding the absence of a presumption to that effect; (4) “domestic insurer” has the meaning given in AS 21.97.900 and, in addition, for the purposes of this chapter, includes an insurer that has been authorized to do business in this state and that, during its three preceding fiscal years taken together, or during any lesser period of time if it has been licensed to transact its business in this state only for a lesser period of time, has written an average of more gross premiums in this state than it has written in its state of domicile during the same period, and the gross premiums written constitute 33 percent or more of its total gross premiums written everywhere in the United States for the three-year or lesser period, as reported in its three most recent annual statements; (5) “enterprise risk” means an activity, circumstance, event, or series of events involving one or more affiliates of an insurer that, if not remedied promptly, is likely to have a material adverse effect on the financial condition or liquidity of the insurer or its insurance holding company system as a whole including anything that would cause the insurer's risk based capital to fall into company action level under AS 21.14.020 or would cause the insurer to be impaired or in imminent danger of becoming impaired, as defined in AS 21.97.900 and regulations adopted by the director; (6) “group-wide supervisor” means the regulatory official authorized to engage in conducting and coordinating group-wide supervision activities who is determined or acknowledged by the director under AS 21.22.117 to have sufficient significant contacts with the internationally active insurance group; (7) “highly concentrated” means a market in which the share of the four largest insurers is 75 percent or more of the market; (8) “insurance holding company system” means a system consisting of two or more affiliated persons, one or more of which is an insurer; (9) “insurer” has the meaning given in AS 21.97.900 and includes a company or group of companies under common management, ownership, or control; it does not include agencies, authorities, or instrumentalities of the United States, its possessions and territories, the Commonwealth of Puerto Rico, the District of Columbia, a state or political subdivision of a state; (10) “internationally active insurance group” means an insurance holding company system that includes an insurer registered under AS 21.22.060 and that meets the following criteria: (A) insurers that are part of the insurance holding company system write premiums in at least three countries; (B) the percentage of gross premiums written outside the United States is at least 10 percent of the insurance holding company system's total gross written premiums; and (C) based on a three-year rolling average, the total assets of the insurance holding company system are at least $50,000,000,000 or the total gross written premiums of the insurance holding company system are at least $10,000,000,000. (11) “involved insurer” means an insurer that either acquires or is acquired, is affiliated with an acquirer or acquired, or is the result of a merger; (12) “market” or “insurance market” means direct written insurance premium in this state for a line of business as contained in the annual statement required to be filed by insurers licensed to do business in this state; in determining the relevant product and geographical markets, the director shall give due consideration to, among other things, the definitions or guidelines adopted by the National Association of Insurance Commissioners and to information submitted by parties to the acquisition; in the absence of sufficient information to the contrary, the relevant product market is assumed to be the direct written insurance premium for a line of business, the line being that used in the annual statement required to be filed by insurers doing business in this state, and the relevant geographical market is assumed to be this state; (13) “person” means an individual, a corporation, a limited liability company, a partnership, an association, a joint stock company, a trust, an unincorporated organization, any similar entity or any combination of these entities acting in concert, but does not include a joint venture partnership exclusively engaged in owning, managing, leasing, or developing real or tangible personal property, or a securities broker performing not more than the usual and customary broker's function; (14) “security holder” means one who owns any security of a specified person, including common stock, preferred stock, debt obligations, and any other security convertible into or evidencing the right to acquire any of them; (15) “statement value” means the value that an insurer is instructed by the securities valuation office of the National Association of Insurance Commissioners to carry on the insurer's financial statement and that represents an investment; (16) “subsidiary” means an affiliate controlled by a specified person directly or indirectly through one or more intermediaries; (17) “supervisory college” means a forum for cooperation and communication among the involved state, federal, and international regulators established for the fundamental purpose of facilitating the effectiveness of supervision of entities that belong to an insurance holding company system. (18) “voting security” includes any security convertible into or evidencing a right to acquire the right to vote for management and the right to vote on other matters as provided in a corporation's articles of incorporation.