23-69-140. Mutualization of stock insurers.

23-69-140. Mutualization of stock insurers. (a) A stock insurer other than a title insurer may become a mutual insurer under such plan and procedure as may be approved by the Insurance Commissioner after a hearing thereon. (b) The commissioner shall not approve any plan, procedure, or mutualization unless: (1) It is equitable to stockholders and policyholders; (2) It is subject to approval by the holders of not less than three-fourths (¾) of the insurer's outstanding capital stock having voting rights and by not less than two-thirds (2/3) of the insurer's policyholders who vote on the plan in person, by proxy, or by mail pursuant to such notice and procedure as may be approved by the commissioner; (3) If a life insurer, the right to vote thereon is limited to holders of policies other than term or group policies and whose policies have been in force for more than one (1) year; (4) Mutualization will result in retirement of shares of the insurer's capital stock at a price not in excess of the fair market value thereof as determined by competent disinterested appraisers; (5) The plan provides for the purchase of the shares of any nonconsenting stockholder in the same manner and subject to the same applicable conditions as provided by § 23-69-148 as to rights of nonconsenting stockholders, with respect to consolidation or merger of insurance corporations; (6) The plan provides for definite conditions to be fulfilled by a designated early date upon which the mutualization will be deemed effective; and (7) The mutualization leaves the insurer with surplus funds reasonably adequate for the security of its policyholders and to enable it to continue successfully in business in the states in which it is then authorized to transact insurance and for the kinds of insurance included in its certificates of authority in the states. (c) This section shall not apply to mutualization under order of court pursuant to rehabilitation or reorganization of an insurer under § 23-68-101 et seq., or to formations of or conversions to domestic mutual holding companies under other provisions of this act. Further, with regard to proposed transactions of a domestic insurer which is a subsidiary or affiliate of a depository institution, the hearing shall be concluded and the order issued within the sixty-day period preceding the effective date of the transaction, and the order shall be final upon entry, pursuant to federal law. Further, any restoration of capital or surplus or special surplus required for approval of the transaction affecting the depository institution's affiliate or subsidiary shall also be accomplished within the same sixty-day period.