(b) No group or quasi-group dividend plan shall be approved, unless:

1. (1) the declaration of dividends remains within the discretion of the insurer, which shall not obligate itself to return to a group member or quasi-group participant any portion of the premium through dividends;
2. (2) the method of determining and declaring dividends is fair and equitable, not unfairly discriminatory, and disclosed to group members or quasi-group participants; and
3. (3) records documenting financial and loss experience for the group or quasi-group, and every dividend declaration or distribution, are maintained subject to the superintendent's inspection.

(c) In addition to the requirements set forth in subdivision (b) of this section, the following requirements shall apply in connection with any group or quasi-group dividend plan based upon implementation of safety-related or other risk management measures:

1. (1) group members or quasi-group participants shall have like exposures to the hazards insured against that can be materially affected by common safety-related or risk management measures beyond those normally required by the insurer for like risks not insured on a group or quasi-group basis;
2. (2) the insurer shall develop and monitor an accident prevention and loss reduction plan, with mandatory adherence to such plan by group members or quasi-group participants; and
3. (3) a safety committee is established to monitor progress and problems in implementing the accident prevention and loss reduction plan.

(d) Dividends earned under a dividend plan approved under this section shall not be paid by the insurer to be withheld in whole or part by the group, master policyholder or sponsoring entity in order to accumulate funds, unless:

1. (1) the balance of the dividends not withheld are promptly distributed to group members or quasi-group participants on a basis that does not result in unfair discrimination;
2. (2) dividends withheld are used to benefit the group or quasi-group, and the specific purpose is disclosed in writing to the group members or quasi-group participants;
3. (3) every group member or quasi-group participant whose dividends are withheld has given specific written consent;
4. (4) dividends withheld are maintained in separate, segregated accounts for the benefit of each consenting group member or quasi-group participant;
5. (5) where the purpose for withholding dividends is to provide funds to the master policyholder or sponsoring entity to assist the insurer in administering an accident prevention and loss reduction plan, a trust shall be established for the benefit of the group members or quasi-group participants, and an annual accounting of expenditures utilizing such withheld funds shall be made to group members or quasi-group participants; and
6. (6) where the purpose is to capitalize an insurer controlled by such group members or quasi-group participants, any dividends so withheld and maintained shall be promptly returned to any group member or quasi-group participant that, for any reason, leaves the group or quasi-group program before such an insurer has been duly organized.