(a) If a reciprocal insurer has a surplus of assets over all liabilities at least equal to the minimum capital and surplus required of a domestic stock insurer authorized to transact like kinds of insurance, upon application of the attorney-in-fact and as approved by the subscribers' advisory committee, the director shall issue a certificate authorizing the insurer to extinguish the contingent liability of subscribers under its policies then in force in this state, and to omit provisions imposing contingent liability in all policies delivered or issued for delivery in this state for as long as all the surplus remains unimpaired.
(b) Upon impairment of the surplus, the director shall immediately revoke the certificate. The revocation shall not render subject to contingent liability a policy then in force and for the remainder of the period for which the premium has theretofore been paid; but after the revocation a policy may not be issued or renewed without providing for contingent assessment liability of the subscriber.
(c) The director may not authorize a domestic reciprocal insurer to extinguish the contingent liability of any of its subscribers or in any of its policies to be issued, unless it qualifies to and does extinguish the liability of all its subscribers and in all the policies for all kinds of insurance transacted by it. Except, that if required by the laws of another state in which the insurer is transacting insurance as an authorized insurer, the insurer may issue policies providing for the contingent liability of those subscribers which may acquire the policies in that state, and need not extinguish the contingent liability applicable to policies theretofore in force in that state.
(d) Notwithstanding (a) - (c) of this section, a reciprocal insurer that provides marine insurance may issue policies that are nonassessable.
Section: Previous 21.75.160 21.75.170 21.75.180 21.75.190 21.75.200 21.75.210 21.75.220 21.75.230 21.75.240 21.75.250 21.75.260 21.75.270 21.75.280 21.75.290 NextLast modified: November 15, 2016