(a) Each group shall establish to the satisfaction of the Commissioner a premium payment plan which shall include:
(1) An initial payment by each member of at least 25% of that member’s annual premium before the start of the group’s fund year; and
(2) Payment of the balance of each member’s annual premium in monthly or quarterly installments.
(b) Each group shall establish and maintain actuarially appropriate loss reserves which shall include reserves for:
(1) Known claims and expenses associated therewith; and
(2) Claims incurred but not reported and expenses associated therewith.
(c) Each group shall establish and maintain bad debt reserves based on the historical experience of the group or other groups.