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This entry was published on 2014-09-22
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SECTION 7306-A
Reconversion of domestic mutual property/casualty insurance company into advance premium corporation or assessment corporation
Insurance (ISC) CHAPTER 28, ARTICLE 73
§ 7306-a. Reconversion of domestic mutual property/casualty insurance
company into advance premium corporation or assessment corporation. Any
domestic mutual property/casualty insurance company, organized under
article twelve of this chapter and licensed under article forty-one of
this chapter which was previously organized as an advance premium
corporation or assessment corporation and which has in force contracts
of insurance of the kinds which advance premium corporations or
assessment corporations, as defined in section six thousand six hundred
two of this chapter, may be authorized to do, covering not less than
three hundred separate risks and on which the premiums in force
aggregates not less than one hundred thousand dollars, may be
reconverted into and licensed as an advance premium corporation or
assessment corporation in the manner prescribed in this section and
subject to any other requirements of law. The successive steps shall be
as follows:

(a) A majority of the board of directors of the domestic mutual
property/casualty insurer shall adopt a resolution approving the
proposed reconversion and appointing a committee of not less than three
directors to prepare a draft of a proposed declaration, charter and
by-laws.

(b) The proposed declaration, charter and by-laws shall be submitted
with an appropriate resolution to the board for its approval.

(c) A majority of the board at any regular or special meeting thereof
shall approve by resolution the proposed declaration, charter and
by-laws, which shall conform to the requirements of this chapter
relative to the contents of charters and by-laws of advance premium
corporations or assessment corporations, as the case may be, hereafter
organized, with such additions as the superintendent shall approve to
accommodate insurance contracts then in force. Such resolution shall
also direct that notice that the proposed reconversion will be submitted
for approval at a special meeting of policyholders to be called for that
purpose be mailed, with postage prepaid, to all policyholders at their
last known post office addresses respectively, at least thirty days
prior to the date of the meeting, together with copies of the
resolutions provided for in subsections (a) and (b) of this section and
this subsection and of the proposed declaration, charter and by-laws.

(d) At least two-thirds of the votes of policyholders voting at such
meeting either in person or by proxy, if the domestic mutual
property/casualty insurer's by-laws provide for a vote by proxy, shall
be cast in favor of the proposed reconversion and of the adoption of the
proposed declaration and charter and proposed by-laws. A resolution
shall similarly be adopted instructing the president and secretary to
execute or certify and file all necessary papers and instruments
incident to the proposed conversion.

(e) The proposed declaration and charter executed by the president and
secretary together with proof of mailing of notice of policyholders'
meeting and copies of all other necessary papers and instruments
incident to the proposed reconversion, together with a certificate of
their adoption as provided for herein, subscribed and affirmed by such
officers as true under the penalties of perjury, shall be submitted to
the superintendent.

(f) If the superintendent finds, by such investigation or examination
as he deems appropriate to make, that the corporation meets the initial
surplus and reserve requirements for advance premium corporations or
assessment corporations, as the case may be, to do the kinds of
insurance business for which the corporation is to be licensed, and
complies with all other provisions of this section, he shall approve the
declaration and charter and by-laws and file the same together with the
other documents submitted as required by subsection (e) of this section
in his office, and coincident with such filing such domestic mutual
property/casualty insurance company shall become an advance premium
corporation or assessment corporation, as the case may be.

(g) Upon compliance by the domestic mutual property/casualty insurer
with the foregoing and with any other lawful prerequisites for the
issuance of an insurer's license, the superintendent may, in accordance
with subsection (d) of section one thousand one hundred two of this
chapter, grant a license to such advance premium corporation or
assessment corporation, as the case may be. Such corporation shall
thereafter be subject to all the provisions and requirements of this
chapter relative to advance premium corporations or assessment
corporations, as the case may be.