California Insurance Code

§ 4097.06

INS § 4097.06 Effective Jan 1, 1999Div. 2 · Part 1 · Ch. 4 · Art. 10

Statute text

(a)The commissioner shall examine the plan submitted pursuant to subdivision (b) of Section 4097.02. If the plan provides for the establishment of a mutual holding company under Section 4097.05, the mutual insurer shall demonstrate that the issuance of stock:

(1)Will not require members to pay additional funds to retain their rights in surplus, but nothing herein is intended to prohibit or restrict a mutual insurer that is converting to a stock insurer by establishing a mutual holding company from offering to its members subscription rights that are in addition to the rights in surplus to be held in the mutual holding company.

(2)Issued to officers, directors, employees, or employee benefit plans for their benefit, if any, will be fair, just and equitable and not hazardous to policyholders, stockholders, or creditors.

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Legislative history

Added by Stats. 1998, Ch. 421, Sec. 4. Effective January 1, 1999.