(a) An applicant or administrator may be considered to be operating or conducting business in a hazardous or injurious manner if the administrator or applicant:
  (1) has failed to file financial statements, documents, records, or reports required under the Insurance Code Chapter 4151 or this subchapter within the time periods prescribed by the Insurance Code Chapter 4151, this subchapter, or as requested by the department pursuant to law;
  (2) has filed any false or misleading financial information;
  (3) is unable to pay its obligations as they become due and payable;
  (4) has not maintained records sufficient to permit examiners to determine its financial condition or compliance with the Insurance Code, the Labor Code, and rules adopted thereunder;
  (5) does not employ management staff with the experience, competence, or trustworthiness to conduct its operations in a safe or sound manner;
  (6) employs management staff that has engaged in any unlawful activity;
  (7) has not complied or is not complying with the terms of a written agreement with an insurer, HMO, plan sponsor, or group;
  (8) has engaged or is engaged in a pattern of failing to settle claims in accordance with contractual, regulatory, or statutory requirements; or
  (9) has engaged or is engaged in fraudulent or dishonest practices or acts.
(b) Other facts and circumstances not specified in subsection (a) of this section, as determined by the commissioner, that relate to the financial condition or business operations or conduct of an applicant or administrator in this state may also indicate that an applicant or administrator is operating in a hazardous or injurious manner.

Source Note: The provisions of this §7.1616 adopted to be effective June 25, 2009, 34 TexReg 4143