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(a) Requests for approval of extraordinary dividends or any other extraordinary distributions to shareholders must 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 that valuation;
(4) a work paper showing the calculations used to determine that the proposed dividend is extraordinary; the work paper shall include the following information:
(A) the amounts, dates, and form of payment of all dividends and distributions (including regular dividends but excluding distributions of the insurer's own securities) paid within the period of 12 consecutive months ending on the date fixed for payment of the proposed dividend for which approval is sought and commencing on the day after the same day of the same month in the previous year;
(B) policyholder surplus as of the 31st day of the December preceding the date on which the request for dividend approval is submitted:
(C) if the insurer is a life insurer, the net gain from operations for the 12-month period ending the 31st day of the December preceding the date on which the request for dividend approval is submitted;
(D) if the insurer is not a life insurer, the net income for the 12-month period ending the 31st day of the December preceding the date on which the request for dividend approval is submitted and net income for each of the two preceding 12-month periods; and
(E) if the insurer is not a life insurer, the dividends paid to stockholders, excluding distributions of the insurer's own securities, in the two calendar years preceding the calendar year in which the request for dividend approval is submitted:
(5) a balance sheet and statement of income for the period between the last annual statement filed with the director 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 surplus in relation to the insurer's outstanding liabilities, and the adequacy of surplus relative to the insurer's financial needs.
(b) A registered insurer shall report to the director all dividends, other than extraordinary dividends that are subject to AS 21.22.100 (b) and reported in Form D, and other distributions to shareholders within two business days following their declaration and shall include the information required in (a)(4) of this section. This report may be in the form of a letter and is not subject to the requirements under 3 AAC 21.185.
History: Eff. 6/30/77, Register 62; am 10/21/92, Register 124
Authority: AS 21.06.090
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Last modified 7/05/2006