Mutual insurers: Nonassessable policies
- revocation of authority.
1.A domestic mutual insurer, by depositing through the Commissioner and thereafter maintaining unimpaired surplus funds not less in amount than the minimum paid-in capital stock and surplus required of a domestic stock insurer for authority to transact the same kind or kinds of insurance, may, upon receipt of the Commissioner’s order so authorizing, extinguish the contingent liability to assessment of its members as to all its policies in force and, so long as such surplus and deposit are maintained, may omit provisions imposing contingent liability in all policies currently issued. Any deposit of the insurer made through the Commissioner as a prerequisite to its certificate of authority may be included as part of the deposit required under this section.
2.The Commissioner shall not authorize a domestic insurer to extinguish the contingent liability of any of its members or in any of its policies to be issued, unless it qualifies to and does extinguish such liability of all its members and in all such policies for all kinds of insurance transacted by it.
3.The Commissioner shall revoke the authority of a domestic mutual insurer to issue policies without contingent liability if:
(a)The insurer’s assets are less than the sum of its liabilities and the surplus required for such authority and such deficiency is not cured within 30 days after written notice thereof to the insurer by the Commissioner; or
(b)The insurer, by resolution of its board of directors approved by a majority of its members, requests that the authority be revoked.
4.During the absence of such authority the insurer shall not issue any policy without providing therein for the contingent liability of the policyholder, or renew any policy which is then in force without endorsing the same to provide for such contingent liability.
5.A foreign mutual insurer may issue nonassessable policies to its members in this state as authorized by its charter and the laws of the state or country of its domicile, if the requirements for issuance of such policies are substantially equal to or higher than those applicable to domestic insurers under this Code.
Section 693A.250 — Mutual insurers: Nonassessable policies; revocation of authority.,