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the thirty-first day of December of the preceding year, which calculation of the net value of the policies in force shall, for all policies issued on or before the thirty-first day of December, in the year 1902, be based upon the "American Experience Table of Mortality," and four and one-half per cent. interest per annum, and for all policies issued subsequent to said thirty-first day of December, in the year nineteen hundred and two, upon the actuaries' table of mortality, and four per cent. interest per annum; provided, that the Insurance Commissioner may, upon the request of any company, cause all the policies of such company to be valued upon the latter basis; and provided further, that any policies which contain any promise or agreement for the purchase of the policy at any date prior to its maturity or its termination by death for a sum in excess of the value of the policy at such date determined according to the standard of valuation herein prescribed for such policy, then and in every such case the value of policies containing such promises and agreement shall be calculated in such manner and upon such assumptions as to rate of interest and mortality, that the value of the policy so calculated shall at no time be less than the amount stipulated therein, to be paid upon surrender of the policy at the date then attained, and for the purpose of such valuation the standard adoption by the company for the valuation of such obligation may, if adequate, be employed; and in the determinations of the values of the policies, the calculations may be made either seriatim or of policies in groups, using approximate averages for fractions of a year, and the net value of a policy at any time shall be taken to be the net present value at the attained age upon the basis adopted for the valuation as above provided of the sum insured less the present value determined upon, the same basis of the future net premiums payable upon the policy; and in all certificates of valuation issued by the insurance commissioner or accepted by him under the provisions of sub-section third, the basis upon which the valuation has been made shall be expressed.

Second-A. The Insurance Commissioner may, in his discretion, upon the request of any life insurance company so reporting to him, cause the net value of all or of any number of the policies in force in such company to be calculated upon a

higher basis of reserve than that prescribed above by the assumption of a lower rate of interest than that prescribed, or the assumption of a higher rate of mortality by the substitution of the Actuaries' Table for the American Experience Table of Mortality or otherwise as the circumstances of the case may require, provided that in no case shall the net value so ascertained and taken as a basis of reserve be less than that determined by the standard of valuation above prescribed; and in every certificate of the valuation of policies issued by the commissioner the basis upon which the valuation is calculated shall be stated.*

Third. The Insurance Commissioner shall accept the valuation made by the Insurance Commissioners of the State under whose authority a life insurance company is organized, or that of the State in which it may elect to have its policies valued, when such valuations have been properly made on sound and recognize principles, and legal basis not less than that prescribed above; provided, that the company shall furnish to the Insurance Commissioner of this State a certificate from the Insurance Commissioners of such State, setting forth the value calculated on the data designated above, of all the policies in force in the company on the previous thirty-first day of December, and stating that the said company is fully authorized to do business in its own State; and every life insurance company doing business in this State during the year for which the statement is made that fails promptly to furnish the certificate aforesaid shall be required to make a full detailed list of its policies and securities to the Insurance Commissioner of this State, who shall thereupon cause the same to be valued at the expense of said company.

Fourth. And it shall be the duty of the Insurance Commissioner, after having ascertained the amount of the net values of all of the policies in force, to see that the company has that amount in safe legal securities of the description and character hereinafter provided for in this Article, after all its other debts and claims against it, including those resisted by the company, but exclusive of capital stock, have been provided for; and in case it is found that any life insurance company doing business * This sub-section "Second-A" is the amendment of 1914, ch. 821.

in this State has not on hand, after deducting all debts and claims against it, exclusive of capital stock, an amount of assets of the character hereinafter prescribed in this Article equal in value to the net present value of all its policies in force, it shall be the duty of the Insurance Commissioner to publish the fact that the existing condition of the affairs of such company is below the legal standard of solvency established by this State, and he shall require the company at once to cease doing new business, and he shall immediately institute such proceedings as are necessary to protect the rights of all persons interested in said company; and it shall be his duty to see that no company is permitted to insure lives in this State whose charter authorizes it to do fire, marine or inland insurance business.

Fifth. It shall be the duty of the Insurance Commissioner, after he has notified a life insurance company, organized under the authority of this State, to cease doing new business on account of its condition being below the legal standard of solvency established by this State at once to cause a rigid examination in regard to all the affairs of such company. In case it shall appear that said company is in such a condition as to fall below the legal standard of solvency established by this State, then in that event the said Insurance Commissioner shall not permit the said company to continue in the control of its business; and it is hereby made his duty to at once institute the necessary proceedings for the protection of its policy holders in accordance with the laws of this State, and to publish the results of the examination of the affairs of such company, whenever he may. deem it for the interest of the public so to do, in one or more papers published in this State; provided, however, in case it shall appear that there is no fraud or gross incompetency or recklessness in the management of said company, he may give the said company ninety days from the time of the completion of said examination, prior to the institution of the proceedings as herein before provided, within which to re-establish its solvency, according to the legal standard of solvency established by this State.

Sixth. Before granting certificates of authority to an insurance company to issue policies or make contracts of insurance, the Insurance Commissioner shall be satisfied by such examina

tion and evidence as he sees fit to make and require, that such company is otherwise duly qualified under the laws of this State to transact business therein; once at least during his term of office he shall cause the affairs of every insurance company organized under the laws of this State to be thoroughly inspected and examined, with special regard to its financial condition and its ability to fulfill its obligations, and shall ascertain and determine whether or not in has complied with the laws of this State; he shall also cause an examination of every such company to. be made whenever he deems it prudent to do so upon request of five or more of the stockholders, creditors, policy-holders or persons pecuniarily interested therein, who shall make affidavit of their belief, with specifications of reasons therefor, showing a prima facie case that such company is in an unsound condition; and whenever the Insurance Commissioner may have reason to doubt the solvency or the correctness of the statement of any company not organized under the laws of this State, which may have been licensed to do business in this State, or which may be applying for said license, he shall communicate such doubts, and the reasons for them, to the Insurance Commissioner, or other officer charged with the supervision of insurance corporations of the State in which said company is located, and if he is not satisfied from the information obtained from such Insurance Commissioner or other officer, or from the officers of the company, that the condition of the company is such as to warrant him in permitting it to transact business in this State, under the provisions of this Article, he shall notify such company that it will be necessary for him to have its affairs examined. Whenever an examination of any insurance company doing business in this State shall be determined upon under the provisions of this Article, the examiner of the Insurance Department and such other person or persons who shall be appointed by the Insurance Commissioner for that purpose shall visit such company at its principal office and make a thorough examination into all its affairs; and if such company shall refuse to permit such exami· nation, or shall refuse free access to all its books and papers, or shall in any way prevent or obstruct a thorough examination into its affairs, he shall not grant a license to such company, or

if a license shall already have been granted, he shall at once revoke it and publish the fact of such revocation in one daily newspaper published in the City of Baltimore. The examiner of the Insurance Department shall be paid by the company whose affairs are examined, his traveling and other expenses, and in addition thereto a sum to be approved by the Insurance Commissioner not exceeding, however, fifteen dollars ($15.00) for each and every day that he shall be engaged in any such examination, said per diem and expenses to be in addition to the compensation provided in Section 159A of this Article; and such other person or persons who may be appointed by the Insurance Commissioner for any of the purposes mentioned herein shall each be paid by the company whose affairs are examined, their traveling and other expenses, and in addition thereto, a sum to be approved by the Insurance Commissioner, not exceeding, however, ten dollars ($10.00) per day for each and every day that he or they are engaged in any such examination; except that the Insurance Commissioner may employ one special examiner on any examination that in his judgment may require such employment, who shall be paid by the company whose affairs are examined, his traveling and other expenses, and in addition thereto, a sum to be approved by the Insurance Commissioner, not exceeding, however, twenty-five dollars ($25.00) per day, for each and every day that he is engaged in any such examination; and provided further, that any official or employe of the Insurance Department who shall be directed by the Insurance Commissioner to assist in the examination of any insurance company organized and located outside of this State and doing business in this State, shall be paid by such company his traveling and other expenses and such reasonable compensation as shall be fixed by the Insurance Commissioner, in addition to the salary paid such official employe out of the funds of said department. If the per diem and expenses in any case herein provided shall remain unpaid after ten days from the completion of any such examination, the Insurance Commissioner may sue therefor. For the purposes of any examination authorized by law, the Insurance Commissioner, or the Insurance Examiner, shall have power and is hereby authorized to summon any person or persons, being within this State,

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