(a) A farm mutual insurance company is solvent if:
(1) the company’s assets, including the policyholders’ contingent liability for the company’s losses, are reasonably sufficient to pay the company’s losses according to the terms of the policies; and
(2) the company’s required unencumbered surplus, if any, has not been impaired in excess of 16-2/3 percent of the required unencumbered surplus.
(b) A company that is solvent as provided by this section may continue to engage in the business of insurance.