P.R. Laws tit. 7, § 1334w
When the Corporation suffers extraordinary losses, it may impose a special premium on the insured cooperatives, which shall be distributed in the proportion that the annual premium paid by each of them holds to the total annual premium paid by all in the year of operations in which the extraordinary loss has been incurred. This special premium shall not exceed one hundred percent (100%) of the total premium collected in said year. When the special premium imposed in a specific year is not sufficient to cover the deficit in the operations of said year, the deficiency may be collected through the imposition, in subsequent years, of special additional premiums for as many years as it may be necessary and subject to the annual limit previously indicated. The Corporation may borrow money from any entity or public or private institutions and, when strictly necessary to handle its liquidity needs, may pignorate its future income proceeding from special premiums as collateral.
When the extraordinary losses are of such magnitude that they require the imposition of a special premium for a term greater than four (4) years, the Board shall impose a rate increase rather than a special premium. Premiums may not be raised in one (1) year of operations in order to pay extraordinary losses for a sum greater than one hundred percent (100%) of the premium that was in effect at the beginning of said year.
In the event that all the described mechanisms have been exhausted, and the resources generated are not sufficient to cover the losses, the following shall be in order:
(1) In the first place, the reserves balance shall be used until it has been exhausted.
(2) If there still is a deficiency to be covered, the capital shall be used up to fifty percent (50%) of the total accrued at the beginning of the year of operations.
(3) If there is still a deficiency, the resources of the Department of the Treasury shall be resorted to as provided in § 1335b of this title.
History —Aug. 17, 2001, No. 114, § 25.