AZERBAIJAN: temporary administration institution established in insurance
Cases of introduction of temporary administration, dismissal of top management and development of a recovery plan may include: reduction of the total capital of a company to a level below the minimal requirements; failure of an insurance company to fulfil its obligations to customers, the Compulsory insurance bureau, the regulator or other parties during a period of 3 months.
Depending on the total capital level of an insurer, the regulator may apply various measures. If an insurer's total capital drops to 90% of regulatory requirements, the insurer will have to submit a recovery plan. If the total capital drops into the range between 90% and 80% - the regulator may request temporary dismissal of the management, and if the total capital is below 80% of the regulatory requirements, a temporary administrator is to be introduced for a period of three months with a possibility of further extension up to 1 year.