Tenn. Comp. R. & Regs. 0780-01-54-.15 - REFUNDS AND DIVIDENDS

(1) Any monies for a fund year in excess of the amount necessary to fund all obligations for that fund year may be declared to be refundable by the board of trustees not less than eighteen (18) months after the end of the fund year and only with the written approval of the Commissioner.

(a) Any request for approval under this Paragraph shall be accompanied by an unaudited management report indicating the financial condition of each fund year.

(b) In addition to the information sought in Subparagraph (a) of this Paragraph, the Commissioner may request such additional information from the pool to help in determining whether the declaration of the dividend would be hazardous to the financial condition of the pool.

(2) If a refund is declared by a pool and such refund is approved to be disbursed by the Commissioner, ten percent (10%) of the refundable amount must be retained by the fund or pool for an additional year to cover any liabilities that may develop as a result of incurred but not reported losses for that period.

(3) Each member shall be given a written description of the refund policy of the pool at the time of application for membership. Payment of a refund based on a previous fund year shall not be contingent on continued membership in the pool after that fund year. Each such refund policy shall be filed and approved by the Commissioner prior to the policy's effective date.

(4) Before any dividend or refund may be paid, the pool must receive the written approval of the Commissioner.

Notes

Tenn. Comp. R. & Regs. 0780-01-54-.15

Original rule filed April 8, 1986; effective May 8, 1986. Repeal and new rule filed August 31, 2005; effective November 14, 2005. Amendment filed December 31, 2008; effective March 16, 2009.

Authority: T.C.A. §§ 50-6-405(c) and (h).