California Insurance Code

§ 11537

INS § 11537 Effective Aug 19, 1996Div. 2 · Part 2 · Ch. 14 · Art. 1

Statute text

For the conversion of a mutual property-casualty insurer, the plan for conversion shall include the following:

(a)A fair and reasonable formula, approved by the commissioner, for determining the equity of each eligible member in the insurer. The equity shall be based upon an appraisal of the fair value of the insurer by one or more qualified disinterested persons appointed by the insurer with the approval of the commissioner. Those persons shall consider the assets and liabilities of the insurer and any factors bearing on the value of the mutual insurer.

(b)Each eligible member of the mutual insurer shall be given a preemptive right to acquire his or her proportionate part of all of the proposed capital stock of the insurer, within a designated reasonable period, by applying upon the purchase of such part the amount of his or her equity as determined under the formula described in subdivision (a).

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Legislative history

Amended by Stats. 1996, Ch. 406, Sec. 5. Effective August 19, 1996.