(a) A plan shall establish loss reserves for all incurred losses, both reported and unreported, for expenses and for unearned premiums in a manner and amount established by the Commissioner by rule or regulation.

(b) A plan also shall establish a surplus account equal to the greater of:

(1) Three times the average paid monthly premium during the plan's most recent fund year;

(2) For plans which do not yet have one fund year's experience, three times the estimated monthly premium; or

(3) One hundred thousand dollars.