(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.
Structure Maryland Statutes
Subtitle 1 - Stock Insurers and Mutual Insurers
Section 3-101 - Scope of Subtitle
Section 3-102 - Applicability of General Corporation Statutes and Insurance Article
Section 3-103 - Formation of Domestic Insurers
Section 3-104 - Approval of Articles of Incorporation and Charter
Section 3-105 - Prerequisites to Solicitation by Prospective Mutual Insurer
Section 3-106 - Assets Required for Mutual Insurer -- in General
Section 3-107 - Assets Required for Mutual Insurer -- Engaging in Business on Assessable Basis
Section 3-108 - Engaging in Additional Kinds of Insurance Business
Section 3-109 - Impairment of Required Surplus
Section 3-110 - Contingent Liability of Members
Section 3-111 - Levy of Assessment
Section 3-112 - Enforcement of Contingent Liability
Section 3-113 - Issuance of Nonassessable Policies
Section 3-114 - Participating Policies
Section 3-116 - Loans to Insurers
Section 3-117 - Loans to and Guarantees of Obligations of Directors and Officers
Section 3-118 - Agreements to Pay Expenses of Management
Section 3-119 - Restrictions on Purchase and Sale of Equity Securities of Domestic Stock Insurers
Section 3-120 - Conversion of Stock Insurer to Mutual Insurer
Section 3-121 - Conversion of Mutual Insurer to Stock Insurer
Section 3-122 - Consolidations, Mergers, and Share Exchanges of Stock Insurers
Section 3-123 - Consolidations and Mergers of Mutual Insurers
Section 3-123.1 - Mutual Insurers Forming a Business Combination
Section 3-124 - Bulk Reinsurance -- Stock Insurers
Section 3-125 - Bulk Reinsurance -- Mutual Insurers
Section 3-126 - Changes in Domicile of Insurers