A. As used in the Risk-Based Capital Act, “mandatory control level event” means any of the following events:

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(1)     the filing of a risk-based capital report that indicates that an insurer’s or health organization’s total adjusted capital is less than its mandatory control level risk- based capital;

(2)     the superintendent’s notification to an insurer or health organization that its adjusted risk-based capital report indicates the existence of an event described in Paragraph (1) of this subsection, unless the insurer or health organization challenges the adjusted report pursuant to Section 59A-5A-8 N.M. Stat. Ann.; or

(3)     if the insurer or health organization challenges the adjusted risk-based capital report, notification to the insurer or health organization that the superintendent has, after hearing, rejected the insurer’s or health organization’s challenge.

B. In the event of a mandatory control level event, the superintendent shall:

(1)     with respect to a life or health insurer, fraternal benefit society or health organization, take such actions as are necessary to place the life or health insurer, fraternal benefit society or health organization under regulatory control pursuant to N.M. Stat. Ann. Chapter 59A, Article 41. In that event, the mandatory control level event constitutes sufficient grounds for the superintendent to take action pursuant to N.M. Stat. Ann. Chapter 59A, Article 41, and the superintendent has the rights, powers and duties with respect to the insurer set forth in N.M. Stat. Ann. Chapter 59A, Article 41.

Notwithstanding the foregoing provisions of this paragraph, the superintendent may forgo action for up to ninety days after the mandatory control level event if the superintendent finds that there is a reasonable expectation that the mandatory control level event can be eliminated within the ninety-day period; or

(2)     with respect to a property and casualty insurer, take such actions as are necessary to place the insurer under regulatory control pursuant to N.M. Stat. Ann. Chapter 59A, Article 41, or, in the case of an insurer that is writing no business and that is running off its existing business, may allow the insurer to continue its run off under the superintendent’s supervision. In either event, the mandatory control level event constitutes sufficient grounds for the superintendent to take action pursuant to N.M. Stat. Ann. Chapter 59A, Article 41, and the superintendent has the rights, powers and duties with respect to the insurer as are set forth in N.M. Stat. Ann. Chapter 59A, Article 41. Notwithstanding the foregoing provisions of this paragraph, the superintendent may forgo action for up to ninety days after the mandatory control level event if the superintendent finds that there is a reasonable expectation that the mandatory control level event can be eliminated within the ninety-day period.