As Introduced 1
122nd General Assembly 4
Regular Session H. B. No. 370 5
1997-1998 6
REPRESENTATIVES BATCHELDER-BUCHY-CAREY-CATES-COLONNA-GARCIA- 8
HAINES-HODGES-HOUSEHOLDER-JERSE-LEWIS-METELSKY-MOTTLEY-NETZLEY- 9
OPFER-REID-SCHULER-STAPLETON-TAYLOR-TERWILLEGER-TIBERI- 10
VAN VYVEN-WACHTMANN-YOUNG 11
13
A B I L L
To amend section 3901.043; to amend, for the purpose 15
of adopting a new section number as indicated in 17
parentheses, section 3913.31 (3913.40); and to 18
enact new section 3913.31 and sections 3913.25, 19
3913.26, 3913.27, 3913.28, 3913.29, 3913.30, 20
3913.32, 3913.33, 3913.34, 3913.35, 3913.36, and 21
3913.37 of the Revised Code to permit a mutual 22
insurance company to raise capital by 23
reorganizing as a stock insurance company that is 24
a majority-owned subsidiary of a mutual 25
insurance holding company. 26
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 28
Section 1. That section 3901.043 be amended, section 30
3913.31 (3913.40) be amended for the purpose of adopting a new 32
section number as indicated in parentheses, and new section 33
3913.31 and sections 3913.25, 3913.26, 3913.27, 3913.28, 3913.29, 34
3913.30, 3913.32, 3913.33, 3913.34, 3913.35, 3913.36, and 3913.37 35
of the Revised Code be enacted to read as follows: 36
Sec. 3901.043. The superintendent of insurance may adopt 45
rules in accordance with Chapter 119. of the Revised Code to 46
establish reasonable fees for any service or transaction 47
performed by the department of insurance pursuant to section 48
1738.04, 1742.03, 3901.321, 3901.341, 3907.09, 3907.10, 3907.11,
2
3907.12, 3911.011, 3913.31 3913.40, 3915.14, 3917.06, 3918.07, 50
3923.02, 3935.04, 3937.03, 3953.28, 3957.12, or 3957.13 of the 51
Revised Code or any provision in sections 3913.01 to 3913.23 or 52
in Chapter 3905. of the Revised Code, if no fee is otherwise 53
provided under Title XVII or XXXIX of the Revised Code for such 54
service or transaction. Any fee collected pursuant to those 55
rules shall be paid into the state treasury to the credit of the 56
department of insurance operating fund.
Sec. 3913.25. AS USED IN SECTIONS 3913.25 TO 3913.37 OF 58
THE REVISED CODE: 60
(A) "INTERMEDIATE HOLDING COMPANY" MEANS A STOCK 63
CORPORATION THAT OWNS ALL OF THE SHARES OF VOTING STOCK OF ONE OR 64
MORE REORGANIZED STOCK COMPANIES AFTER A REORGANIZATION UNDER 65
SECTIONS 3913.25 TO 3913.37 OF THE REVISED CODE. "INTERMEDIATE 67
HOLDING COMPANY" ALSO MEANS A STOCK CORPORATION THAT IS THE 68
PARENT OR SUBSIDIARY OF ANOTHER INTERMEDIATE HOLDING COMPANY. 69
(B) "MUTUAL INSURANCE COMPANY" MEANS A DOMESTIC OR FOREIGN 72
MUTUAL LIFE INSURANCE COMPANY OR A DOMESTIC OR FOREIGN MUTUAL 73
INSURANCE COMPANY OTHER THAN A MUTUAL LIFE INSURANCE COMPANY. 74
(C) "MUTUAL INSURANCE HOLDING COMPANY" MEANS A DOMESTIC 77
MUTUAL INSURANCE HOLDING COMPANY INCORPORATED PURSUANT TO A 78
REORGANIZATION PLAN ADOPTED UNDER SECTIONS 3913.26 TO 3913.28 OF 79
THE REVISED CODE, WHICH COMPANY IS THE PARENT COMPANY OF A 82
REORGANIZED STOCK COMPANY OR OF AN INTERMEDIATE HOLDING COMPANY. 83
(D) "POLICYHOLDER" HAS THE SAME MEANING AS IN SECTION 86
3913.10 OF THE REVISED CODE WHEN USED WITH RESPECT TO A LIFE 89
INSURANCE COMPANY, AND HAS THE SAME MEANING AS IN SECTION 3913.20 90
OF THE REVISED CODE WHEN USED WITH RESPECT TO AN INSURANCE 92
COMPANY OTHER THAN A LIFE INSURANCE COMPANY.
(E) "REORGANIZATION PLAN" MEANS A REORGANIZATION PLAN 95
ADOPTED BY A MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS IN 96
ACCORDANCE WITH SECTION 3913.26 OF THE REVISED CODE. 98
(F) "REORGANIZED STOCK COMPANY" MEANS THE DOMESTIC OR 101
FOREIGN STOCK INSURANCE COMPANY RESULTING FROM A DOMESTIC OR 102
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FOREIGN MUTUAL INSURANCE COMPANY'S REORGANIZATION UNDER SECTIONS 103
3913.25 TO 3913.37 OF THE REVISED CODE. 105
(G) "VOTING STOCK" MEANS SECURITIES OF ANY CLASS OR ANY 108
OWNERSHIP INTEREST HAVING VOTING POWER FOR THE ELECTION OF 109
DIRECTORS, TRUSTEES, OR MANAGEMENT OF A PERSON, OTHER THAN 110
SECURITIES HAVING VOTING POWER ONLY AS A RESULT OF THE OCCURRENCE 111
OF A CONTINGENCY.
Sec. 3913.26. (A) A MUTUAL INSURANCE COMPANY, BY ITSELF 114
OR TOGETHER WITH ONE OR MORE OTHER MUTUAL INSURANCE COMPANIES 115
ACTING PURSUANT TO A JOINT REORGANIZATION PLAN, MAY REORGANIZE IN 116
ACCORDANCE WITH THE REQUIREMENTS OF SECTIONS 3913.25 TO 3913.37 117
OF THE REVISED CODE. 119
(B)(1) A MUTUAL INSURANCE COMPANY MAY ADOPT A 122
REORGANIZATION PLAN THAT IS CONSISTENT WITH THE REQUIREMENTS OF 123
SECTIONS 3913.25 TO 3913.37 OF THE REVISED CODE. SUCH A PLAN MAY 125
ONLY BE ADOPTED BY THE AFFIRMATIVE VOTE OF NOT LESS THAN 126
TWO-THIRDS OF THE MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS. 127
(2) AT ANY TIME BEFORE A REORGANIZATION PLAN HAS RECEIVED 129
THE APPROVAL OF THE SUPERINTENDENT OF INSURANCE UNDER SECTION 130
3913.28 OF THE REVISED CODE, A MUTUAL INSURANCE COMPANY'S BOARD 133
OF DIRECTORS MAY AMEND OR WITHDRAW THE PLAN BY THE AFFIRMATIVE 134
VOTE OF NOT LESS THAN TWO-THIRDS OF THE BOARD OF DIRECTORS. 135
(C) A REORGANIZATION PLAN SHALL PROVIDE FOR THE 138
INCORPORATION OF A MUTUAL INSURANCE HOLDING COMPANY, AND SHALL 139
PROVIDE FOR THE CONTINUATION OF THE CORPORATE EXISTENCE OF THE 140
MUTUAL INSURANCE COMPANY AS A STOCK INSURANCE COMPANY. 141
(D) A REORGANIZATION PLAN SHALL PROVIDE THAT ALL OF THE 144
INITIAL SHARES OF VOTING STOCK OF A REORGANIZED STOCK COMPANY 145
SHALL BE ISSUED TO ITS PARENT MUTUAL INSURANCE HOLDING COMPANY OR 146
TO AN INTERMEDIATE HOLDING COMPANY. NOTHING IN SECTIONS 3913.25 147
TO 3913.37 OF THE REVISED CODE, HOWEVER, SHALL BE CONSTRUED AS 150
LIMITING OR RESTRICTING THE AUTHORITY OF A REORGANIZED STOCK 151
COMPANY OR OF AN INTERMEDIATE HOLDING COMPANY TO ISSUE SECURITIES 152
OTHER THAN VOTING STOCK.
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(E)(1) A REORGANIZATION PLAN SHALL PROVIDE THAT THE 155
MEMBERSHIP INTERESTS OF THE POLICYHOLDERS OF A MUTUAL INSURANCE 156
COMPANY SHALL BECOME MEMBERSHIP INTERESTS IN THE MUTUAL INSURANCE 157
HOLDING COMPANY, AND THAT CONCURRENTLY THE POLICYHOLDERS' 158
MEMBERSHIP INTERESTS IN THE MUTUAL INSURANCE COMPANY SHALL BE 159
EXTINGUISHED.
(2) A REORGANIZATION PLAN SHALL PROVIDE THAT THE 161
POLICYHOLDERS OF THE REORGANIZED STOCK COMPANY SHALL BECOME 162
MEMBERS OF THE MUTUAL INSURANCE HOLDING COMPANY IN ACCORDANCE 163
WITH THE ARTICLES OF INCORPORATION AND THE CODE OF REGULATIONS OF 165
THE MUTUAL INSURANCE HOLDING COMPANY.
(F) A REORGANIZATION PLAN SHALL PROVIDE THAT THE MUTUAL 168
INSURANCE HOLDING COMPANY SHALL AT ALL TIMES OWN A MAJORITY OF 169
THE VOTING STOCK OF THE REORGANIZED STOCK COMPANY. 170
ALTERNATIVELY, A REORGANIZATION PLAN SHALL PROVIDE THAT THE 171
MUTUAL INSURANCE HOLDING COMPANY SHALL AT ALL TIMES OWN A 172
MAJORITY OF THE VOTING STOCK OF AN INTERMEDIATE HOLDING COMPANY, 173
WHICH INTERMEDIATE HOLDING COMPANY SHALL AT ALL TIMES OWN ALL OF 174
THE VOTING STOCK OF THE REORGANIZED STOCK COMPANY. 175
(G) THE BOARD OF DIRECTORS OF A MUTUAL INSURANCE COMPANY 178
SHALL FILE ALL OF THE FOLLOWING WITH THE SUPERINTENDENT WITHIN 179
NINETY DAYS AFTER ADOPTING A REORGANIZATION PLAN: 180
(1) THE REORGANIZATION PLAN; 182
(2) THE FORMS OF NOTICES TO BE PROVIDED TO POLICYHOLDERS 184
UNDER DIVISION (B) OF SECTION 3913.27 OF THE REVISED CODE; 187
(3) THE FORM OF PROXY, IF ANY, TO BE SOLICITED FROM 189
POLICYHOLDERS; 190
(4) THE PROPOSED ARTICLES OF INCORPORATION AND CODE OF 192
REGULATIONS FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE 193
REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, FOR AN 194
INTERMEDIATE HOLDING COMPANY. THE ARTICLES OF INCORPORATION AND 195
CODE OF REGULATIONS SHALL BE SIGNED BY THE CHAIRPERSON OF THE 196
BOARD, THE PRESIDENT OR VICE-PRESIDENT, AND BY THE SECRETARY OR 197
AN ASSISTANT SECRETARY, OF THE MUTUAL INSURANCE COMPANY. 198
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(5) SUCH OTHER DOCUMENTS OR INFORMATION AS THE 200
SUPERINTENDENT MAY REQUIRE. 201
(H) NOTHING IN SECTIONS 3913.25 TO 3913.37 OF THE REVISED 205
CODE SHALL LIMIT OR RESTRICT AN INTERMEDIATE HOLDING COMPANY'S 207
AUTHORITY UNDER SECTION 1701.13 OF THE REVISED CODE TO FORM OR 209
ACQUIRE THE CONTROL OF OTHER CORPORATIONS, WHETHER DOMESTIC OR 210
FOREIGN, PROFIT OR NONPROFIT. 211
Sec. 3913.27. (A) A REORGANIZATION PLAN ADOPTED BY A 214
MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS PURSUANT TO SECTION 215
3913.26 OF THE REVISED CODE SHALL BE VOTED UPON BY A MUTUAL 218
INSURANCE COMPANY'S POLICYHOLDERS AT A POLICYHOLDERS' MEETING. A 219
POLICYHOLDER IS ENTITLED TO CAST ONLY ONE VOTE, IN PERSON OR BY 220
PROXY, ON THE REORGANIZATION PLAN REGARDLESS OF THE NUMBER OF 221
POLICIES OR CONTRACTS THAT THE POLICYHOLDER MAY OWN OR HOLD. 222
(B) ALL POLICYHOLDERS SHALL BE GIVEN NOTICE OF THE 225
POLICYHOLDERS' MEETING TO VOTE UPON THE REORGANIZATION PLAN AT 226
LEAST THIRTY DAYS PRIOR TO THE DATE FIXED FOR THE POLICYHOLDERS' 227
MEETING. THE NOTICE SHALL BE GIVEN IN ACCORDANCE WITH THE 228
PROVISIONS FOR NOTICE FOR A POLICYHOLDERS' MEETING CONTAINED IN 229
THE MUTUAL INSURANCE COMPANY'S ARTICLES OF INCORPORATION, CODE OF 230
REGULATIONS, OR BYLAWS. THE NOTICE SHALL INCLUDE A SUMMARY OF 232
THE REORGANIZATION PLAN ADOPTED BY THE BOARD OF DIRECTORS, A 233
UNIFORM BALLOT FOR VOTING ON THE QUESTION OF THE REORGANIZATION 234
PLAN, AND A STATEMENT INFORMING THE POLICYHOLDERS THAT THE 235
SUPERINTENDENT OF INSURANCE MAY FIX A TIME AND PLACE FOR A PUBLIC 236
HEARING ON THE REORGANIZATION PLAN, TO BE HELD WITHIN THIRTY DAYS 237
AFTER THE SUPERINTENDENT'S RECEIPT OF WRITTEN NOTICE FROM THE 238
BOARD OF DIRECTORS OF THE POLICYHOLDERS' APPROVAL OF THE 239
REORGANIZATION PLAN. 240
(C) A REORGANIZATION PLAN SHALL BE APPROVED UPON RECEIVING 243
THE AFFIRMATIVE VOTE OF AT LEAST A MAJORITY OF THE VOTES CAST BY 244
POLICYHOLDERS.
(D)(1) IF A REORGANIZATION PLAN IS APPROVED AT THE 247
POLICYHOLDERS' MEETING, THE BOARD OF DIRECTORS OF A MUTUAL 248
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INSURANCE COMPANY SHALL PROVIDE THE SUPERINTENDENT WITH WRITTEN 249
NOTICE OF THAT APPROVAL WITHIN TEN DAYS AFTER THE POLICYHOLDERS' 250
MEETING. 251
(2) THE SUPERINTENDENT MAY, WITHIN TEN DAYS AFTER 253
RECEIVING THE NOTICE FROM THE BOARD OF DIRECTORS, PROVIDE WRITTEN 255
NOTICE TO THE MUTUAL INSURANCE COMPANY OF THE SUPERINTENDENT'S 256
INTENT TO CONDUCT ONE OR MORE PUBLIC HEARINGS ON THE 257
REORGANIZATION PLAN. AT A MINIMUM, THE SUPERINTENDENT'S NOTICE 258
TO THE MUTUAL INSURANCE COMPANY SHALL INCLUDE A TIME AND A PLACE 259
FOR THE FIRST PUBLIC HEARING, WHICH SHALL BE HELD WITHIN THIRTY 260
DAYS AFTER THE SUPERINTENDENT'S RECEIPT OF THE NOTICE FROM THE 261
BOARD OF DIRECTORS.
(3) WITHIN TEN DAYS AFTER THE MUTUAL INSURANCE COMPANY'S 263
RECEIPT OF A NOTICE FROM THE SUPERINTENDENT OF THE 264
SUPERINTENDENT'S INTENT TO CONDUCT ONE OR MORE PUBLIC HEARINGS ON 266
THE REORGANIZATION PLAN, IF SUCH NOTICE IS PROVIDED, THE MUTUAL 267
INSURANCE COMPANY SHALL PROVIDE NOTICE OF THE TIME AND PLACE OF 268
SUCH HEARING BY CAUSING THIS INFORMATION TO BE PUBLISHED ONCE 269
EACH WEEK FOR TWO CONSECUTIVE WEEKS IN A NEWSPAPER PUBLISHED AND 270
OF THE LARGEST CIRCULATION IN THE COUNTIES OF CUYAHOGA, FRANKLIN, 271
HAMILTON, AND LUCAS, IN THE COUNTY IN THIS STATE IN WHICH THE 273
MUTUAL INSURANCE COMPANY HAS ITS PRINCIPAL OFFICE, AND IN THE 274
NEWSPAPER OF THE LARGEST CIRCULATION IN THE STATE CAPITAL OF EACH 275
STATE OF THE UNITED STATES IN WHICH THE COMPANY MAINTAINS AN 276
OFFICE OR AGENCY FOR THE SOLICITATION OF INSURANCE. 277
(E) THE PROPOSED ARTICLES OF INCORPORATION AND CODE OF 280
REGULATIONS FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE 281
REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, FOR AN 282
INTERMEDIATE HOLDING COMPANY, AS FILED WITH THE SUPERINTENDENT 283
PURSUANT TO DIVISION (G)(4) OF SECTION 3913.26 OF THE REVISED 286
CODE, SHALL ALSO BE VOTED UPON BY THE MUTUAL INSURANCE COMPANY'S 287
POLICYHOLDERS AT THE POLICYHOLDERS' MEETING HELD PURSUANT TO THIS 288
SECTION. THE ARTICLES OF INCORPORATION AND CODE OF REGULATIONS 289
SHALL BE ADOPTED UPON RECEIVING THE AFFIRMATIVE VOTE AT LEAST A 290
7
MAJORITY OF THE VOTES CAST BY POLICYHOLDERS. 291
(F) AT ALL PUBLIC HEARINGS CONDUCTED BY THE SUPERINTENDENT 294
PURSUANT TO THE SUPERINTENDENT'S AUTHORITY UNDER DIVISION (D)(2) 296
OF THIS SECTION, THE SUPERINTENDENT MAY SUMMON AND COMPEL THE 297
ATTENDANCE AND TESTIMONY OF WITNESSES AND THE PRODUCTION OF BOOKS 298
AND PAPERS. THE SUPERINTENDENT SHALL HEAR THE TESTIMONY OF 300
PERSONS CLAIMING TO BE ADVERSELY AFFECTED BY THE REORGANIZATION 301
PLAN, AND OF OTHERS WISHING TO COMMENT ON THE REORGANIZATION 302
PLAN. SUCH PERSONS MAY PRESENT A POSITION AND OFFER COMMENTS 305
CONCERNING THE REORGANIZATION PLAN, INCLUDING A POSITION AND 306
COMMENTS CONCERNING WHETHER THE REORGANIZATION PLAN IS FAIR AND 307
EQUITABLE TO THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS AND 308
WHETHER IT COMPLIES WITH SECTIONS 3913.25 TO 3913.37 OF THE 309
REVISED CODE.
(G) A MUTUAL INSURANCE COMPANY'S FAILURE TO PROVIDE A 312
MEMBER OR MEMBERS WITH THE NOTICE REQUIRED BY THIS SECTION SHALL 313
NOT IMPAIR THE VALIDITY OF ANY ACTION TAKEN UNDER SECTIONS 314
3913.25 TO 3913.37 OF THE REVISED CODE, IF THE MUTUAL INSURANCE 316
COMPANY HAS COMPLIED SUBSTANTIALLY AND IN GOOD FAITH WITH ALL 317
NOTICE REQUIREMENTS. 318
Sec. 3913.28. (A) A MUTUAL INSURANCE COMPANY SHALL NOT 321
PROCEED WITH A REORGANIZATION PLAN APPROVED BY THE MUTUAL 322
INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION 3913.27 OF THE 324
REVISED CODE UNTIL THE REORGANIZATION PLAN HAS BEEN REVIEWED BY, 326
AND HAS RECEIVED THE APPROVAL OF, THE SUPERINTENDENT OF 327
INSURANCE, AND THE ARTICLES OF INCORPORATION FOR THE MUTUAL 328
INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK COMPANY, AND, 329
IF APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY, HAVE BEEN 330
EXAMINED AND APPROVED BY THE ATTORNEY GENERAL IN ACCORDANCE WITH 333
THIS SECTION.
(B) THE SUPERINTENDENT SHALL APPROVE A REORGANIZATION PLAN 336
IF, UPON REVIEW, THE SUPERINTENDENT FINDS ALL OF THE FOLLOWING: 337
(1) THE ADOPTION, APPROVAL, AND CONTENTS OF THE 339
REORGANIZATION PLAN COMPLY WITH SECTIONS 3913.25 TO 3913.37 OF 340
8
THE REVISED CODE; 342
(2) THE MUTUAL INSURANCE COMPANY HAS PROPERLY FILED ALL 344
DOCUMENTS, FORMS, AND OTHER INFORMATION REQUIRED BY DIVISION (G) 346
OF SECTION 3913.26 OF THE REVISED CODE; 348
(3) THE REORGANIZATION PLAN IS FAIR AND EQUITABLE TO THE 350
MUTUAL INSURANCE COMPANY'S POLICYHOLDERS. 351
(C) THE SUPERINTENDENT MAY RETAIN QUALIFIED EXPERTS, AT 354
THE MUTUAL INSURANCE COMPANY'S EXPENSE, TO ASSIST IN REVIEWING 355
THE REORGANIZATION PLAN.
(D) THE SUPERINTENDENT SHALL APPROVE OR REJECT A 358
REORGANIZATION PLAN NOT LATER THAN THIRTY DAYS AFTER THE LATER OF 359
THE APPROVAL OF THE REORGANIZATION PLAN BY THE MUTUAL INSURANCE 360
COMPANY'S POLICYHOLDERS OR THE COMPLETION OF PUBLIC HEARINGS HELD 361
IN ACCORDANCE WITH SECTION 3913.27 OF THE REVISED CODE. THE 364
SUPERINTENDENT MAY EXTEND THIS TIME PERIOD BY AN ADDITIONAL 365
THIRTY DAYS BY PROVIDING WRITTEN NOTICE TO THE MUTUAL INSURANCE 366
COMPANY.
(E) UPON DECIDING TO APPROVE OR TO REJECT A REORGANIZATION 369
PLAN, THE SUPERINTENDENT SHALL NOTIFY THE MUTUAL INSURANCE 370
COMPANY OF THE DECISION BY REGULAR MAIL. IF THE SUPERINTENDENT 371
REJECTS A REORGANIZATION PLAN, THE SUPERINTENDENT'S NOTICE SHALL 372
DETAIL THE REASONS FOR THE REJECTION. 373
(F) A MUTUAL INSURANCE COMPANY SHALL FILE THE FOLLOWING 376
DOCUMENTS WITH THE SUPERINTENDENT WITHIN THIRTY DAYS AFTER 377
RECEIVING NOTICE FROM THE SUPERINTENDENT OF THE SUPERINTENDENT'S 378
APPROVAL OF A REORGANIZATION PLAN: 379
(1) THE MINUTES OF THE POLICYHOLDERS' MEETING AT WHICH THE 382
REORGANIZATION PLAN WAS APPROVED;
(2) THE ARTICLES OF INCORPORATION AND CODE OF REGULATIONS 384
FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED 385
STOCK COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING 386
COMPANY, AS ADOPTED BY THE MUTUAL INSURANCE COMPANY'S 387
POLICYHOLDERS UNDER SECTION 3913.27 OF THE REVISED CODE. 390
(G)(1) A MUTUAL INSURANCE COMPANY SHALL SUBMIT THE 393
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ARTICLES OF INCORPORATION FOR THE MUTUAL INSURANCE HOLDING 394
COMPANY AND THE REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, 395
FOR AN INTERMEDIATE HOLDING COMPANY, AS ADOPTED BY THE MUTUAL 396
INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION 3913.27 OF THE 398
REVISED CODE, WITH THE ATTORNEY GENERAL FOR THE ATTORNEY 400
GENERAL'S EXAMINATION AND APPROVAL. IF, UPON EXAMINATION, THE 401
ATTORNEY GENERAL FINDS THAT THE ARTICLES OF INCORPORATION ARE IN 402
ACCORDANCE WITH APPLICABLE SECTIONS OF THE REVISED CODE, AND NOT 404
INCONSISTENT WITH THE CONSTITUTION AND LAWS OF THE UNITED STATES 407
AND OF THIS STATE, THE ATTORNEY GENERAL SHALL APPROVE OF THE 408
ARTICLES OF INCORPORATION. THE ATTORNEY GENERAL SHALL NOTIFY THE 409
MUTUAL INSURANCE COMPANY OF THE APPROVAL BY REGULAR MAIL. 410
(2) UPON OBTAINING THE APPROVALS OF THE SUPERINTENDENT AND 413
THE ATTORNEY GENERAL UNDER THIS SECTION, THE MUTUAL INSURANCE 414
COMPANY'S BOARD OF DIRECTORS SHALL FILE THE FOLLOWING WITH THE 415
SECRETARY OF STATE:
(a) A CERTIFICATE OF REORGANIZATION, SIGNED BY THE 417
CHAIRPERSON OF THE BOARD, THE PRESIDENT OR A VICE-PRESIDENT, AND 418
THE SECRETARY OR AN ASSISTANT SECRETARY OF THE MUTUAL INSURANCE 419
COMPANY. THE ARTICLES OF INCORPORATION FOR THE MUTUAL INSURANCE 420
HOLDING COMPANY AND THE REORGANIZED STOCK COMPANY, AND, IF 421
APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY, AS ADOPTED BY 422
THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION 423
3913.27 OF THE REVISED CODE, SHALL ACCOMPANY THE CERTIFICATE OF 426
REORGANIZATION.
(b) A STATEMENT, SIGNED BY THE CHAIRPERSON OF THE BOARD, 429
THE PRESIDENT OR A VICE-PRESIDENT, AND THE SECRETARY OR AN 430
ASSISTANT SECRETARY, OF THE MUTUAL INSURANCE COMPANY, OF THE
MANNER OF THE ADOPTION OF THE ARTICLES OF INCORPORATION FOR THE 431
MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK 432
COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY; 434
(c) COPIES OF THE APPROVALS OBTAINED FROM THE 436
SUPERINTENDENT AND ATTORNEY GENERAL UNDER THIS SECTION. 437
(H) A REORGANIZATION PLAN SHALL BE EFFECTIVE UPON THE 440
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FILING OF ALL OF THE DOCUMENTS AND STATEMENTS REQUIRED BY 441
DIVISION (G) OF THIS SECTION, OR AT SUCH LATER DATE AS THE 443
CERTIFICATE OF REORGANIZATION MAY PROVIDE. 444
(I) AFTER A REORGANIZATION PLAN TAKES EFFECT, THE 447
SUPERINTENDENT SHALL HAVE JURISDICTION OVER THE MUTUAL INSURANCE 448
HOLDING COMPANY, AND, IF APPLICABLE, OVER AN INTERMEDIATE HOLDING 449
COMPANY, IN ORDER TO ENSURE THAT THE INTERESTS OF THE MUTUAL 450
INSURANCE COMPANY'S POLICYHOLDERS ARE PROTECTED. 451
Sec. 3913.29. (A) PROPOSED AMENDMENTS TO THE ARTICLES OF 454
INCORPORATION OF A MUTUAL INSURANCE HOLDING COMPANY MAY BE 456
ADOPTED AT ANY MEMBERS' MEETING. THE BOARD OF DIRECTORS OF A 457
MUTUAL INSURANCE HOLDING COMPANY SHALL PROVIDE NOTICE OF ANY 458
MEMBERS' MEETING CONDUCTING A VOTE ON THE ADOPTION OF AN 459
AMENDMENT TO THE ARTICLES OF INCORPORATION IN A NEWSPAPER OF 460
GENERAL CIRCULATION PUBLISHED IN THE COUNTY WHERE THE COMPANY'S 461
PRINCIPAL PLACE OF BUSINESS IS LOCATED, AT LEAST THIRTY DAYS 462
PRIOR TO THE MEMBERS' MEETING. WHERE THE AMENDMENT IS NOT 463
INCONSISTENT WITH THE CONSTITUTION AND LAWS OF THIS STATE AND OF 464
THE UNITED STATES, THE AMENDMENT MAY BE ADOPTED BY THE 467
AFFIRMATIVE VOTE OF AT LEAST THREE-FIFTHS OF THE MEMBERS PRESENT 468
AND VOTING AT THE MEETING. AFTER ADOPTING AN AMENDMENT, THE 469
BOARD OF DIRECTORS SHALL SUBMIT THE AMENDMENT WITH THE ATTORNEY 470
GENERAL FOR EXAMINATION AND APPROVAL.
(B) IF, UPON EXAMINATION, THE ATTORNEY GENERAL FINDS THAT 473
THE AMENDMENTS ADOPTED AT THE MEMBERS' MEETING ARE IN ACCORDANCE 474
WITH APPLICABLE SECTIONS OF THE REVISED CODE, AND ARE NOT 477
INCONSISTENT WITH THE CONSTITUTION AND LAWS OF THE UNITED STATES 480
AND OF THIS STATE, THE ATTORNEY GENERAL SHALL APPROVE OF THE 481
AMENDMENT TO THE ARTICLES OF INCORPORATION. 482
(C) UPON RECEIVING THE APPROVAL OF THE ATTORNEY GENERAL, 485
THE AMENDMENT AND A CERTIFICATE OF THE ATTORNEY GENERAL'S 486
APPROVAL SHALL BE FILED IN THE OFFICE OF THE SECRETARY OF STATE, 487
AND SHALL THEREUPON BE IN EFFECT. AFTER RECORDING THE AMENDMENT, 488
THE SECRETARY OF STATE SHALL DEPOSIT A COPY THEREOF WITH THE 489
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SUPERINTENDENT OF INSURANCE. 490
Sec. 3913.30. (A) UPON A REORGANIZATION PLAN TAKING 493
EFFECT IN ACCORDANCE WITH SECTION 3913.28 OF THE REVISED CODE, 495
THE CORPORATE EXISTENCE OF THE MUTUAL INSURANCE COMPANY SHALL 496
CONTINUE IN THE REORGANIZED STOCK COMPANY. ON THE EFFECTIVE DATE 497
OF THE REORGANIZATION, ALL OF THE ASSETS, RIGHTS, FRANCHISES, AND 498
INTERESTS OF THE MUTUAL INSURANCE COMPANY IN AND TO EVERY SPECIES 500
OF PROPERTY, WHETHER REAL, PERSONAL, OR MIXED, AND ANY
ACCOMPANYING CHOSES IN ACTION, SHALL BE VESTED IN THE REORGANIZED 502
STOCK COMPANY, WITHOUT ANY DEED OR TRANSFER, AND THE REORGANIZED 503
STOCK COMPANY SHALL ASSUME ALL THE OBLIGATIONS AND LIABILITIES OF 504
THE MUTUAL INSURANCE COMPANY.
(B) UNLESS OTHERWISE SPECIFIED IN A REORGANIZATION PLAN, 507
THOSE PERSONS WHO ARE THE DIRECTORS AND OFFICERS OF A MUTUAL 508
INSURANCE COMPANY ON THE EFFECTIVE DATE OF THE REORGANIZATION 509
SHALL SERVE AS THE DIRECTORS AND OFFICERS OF THE REORGANIZED 510
STOCK COMPANY UNTIL NEW DIRECTORS AND OFFICERS ARE ELECTED 511
PURSUANT TO THE REORGANIZED STOCK COMPANY'S ARTICLES OF 512
INCORPORATION AND CODE OF REGULATIONS. 513
Sec. 3913.31. ALL COSTS AND EXPENSES OF THE PROCESS OF A 515
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE REVISED 518
CODE SHALL BE PAID FOR OR REIMBURSED BY THE MUTUAL INSURANCE 519
COMPANY, THE REORGANIZED STOCK COMPANY, OR AN INTERMEDIATE 520
HOLDING COMPANY.
Sec. 3913.32. (A) A MUTUAL INSURANCE COMPANY MAY 523
REORGANIZE BY MERGING ITS POLICYHOLDERS' MEMBERSHIP INTERESTS 524
INTO A DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING COMPANY AND 525
CONTINUING THE CORPORATE EXISTENCE OF THE MUTUAL INSURANCE 526
COMPANY AS A REORGANIZED STOCK COMPANY. A MUTUAL INSURANCE 527
COMPANY REORGANIZING UNDER THIS SECTION SHALL COMPLY WITH ALL 528
APPLICABLE PROVISIONS OF SECTIONS 3913.25 TO 3913.37 OF THE 530
REVISED CODE, AND ALL APPLICABLE LAWS OF FOREIGN JURISDICTIONS, 532
TO EFFECT THE REORGANIZATION.
(B) A DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING COMPANY 535
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MAY REORGANIZE BY MERGING OR CONSOLIDATING ITS MEMBERSHIP 536
INTERESTS INTO ANOTHER DOMESTIC OR FOREIGN MUTUAL INSURANCE 537
HOLDING COMPANY. A DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING 538
COMPANY REORGANIZING UNDER THIS DIVISION SHALL COMPLY WITH ALL 539
APPLICABLE PROVISIONS OF SECTIONS 3913.25 TO 3913.37 OF THE 541
REVISED CODE, AND ALL APPLICABLE LAWS OF FOREIGN JURISDICTIONS, 543
TO EFFECT THE REORGANIZATION.
Sec. 3913.33. A MEMBERSHIP INTEREST IN A MUTUAL INSURANCE 545
HOLDING COMPANY IS NOT A SECURITY UNDER THE LAWS OF THIS STATE. 546
NO MEMBER OF A MUTUAL INSURANCE HOLDING COMPANY MAY TRANSFER 547
MEMBERSHIP IN THE MUTUAL INSURANCE HOLDING COMPANY OR ANY RIGHT 548
ARISING FROM MEMBERSHIP. 549
Sec. 3913.34. (A) SECTIONS 3913.11 TO 3913.13 AND 3913.20 552
TO 3913.23 OF THE REVISED CODE SHALL APPLY TO A MUTUAL INSURANCE 555
HOLDING COMPANY AS IF THE MUTUAL INSURANCE HOLDING COMPANY WERE A 556
DOMESTIC MUTUAL INSURANCE COMPANY. THE MEMBERS OF THE MUTUAL 557
INSURANCE HOLDING COMPANY ARE DEEMED TO BE MEMBERS OF A DOMESTIC 558
MUTUAL INSURANCE COMPANY FOR ALL PURPOSES OF SUCH SECTIONS. 559
(B) A REORGANIZATION OF A DOMESTIC MUTUAL LIFE INSURANCE 562
COMPANY SUBJECT TO SECTIONS 3913.25 TO 3913.37 OF THE REVISED 565
CODE ALSO IS SUBJECT TO SECTIONS 3907.09 TO 3907.11 OF THE 567
REVISED CODE, IF APPLICABLE, BUT IS NOT SUBJECT TO SECTIONS 569
3901.32 TO 3901.323 OF THE REVISED CODE. 571
(C) NOTWITHSTANDING DIVISION (B) OF THIS SECTION, FOR A 575
PERIOD OF FIVE YEARS FOLLOWING THE EFFECTIVE DATE OF A
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE REVISED 578
CODE, NO PERSON SHALL ACQUIRE CONTROL OF A REORGANIZED STOCK 579
COMPANY WITHOUT COMPLIANCE WITH SECTIONS 3901.32 TO 3901.323 OF 580
THE REVISED CODE. FOR PURPOSES OF THIS DIVISION, "CONTROL" HAS 583
THE SAME MEANING AS IN DIVISION (B) OF SECTION 3901.32 OF THE 585
REVISED CODE, EXCEPT THAT CONTROL IS PRESUMED TO EXIST IF ANY 587
PERSON, DIRECTLY OR INDIRECTLY, OWNS, CONTROLS, HOLDS WITH THE 588
POWER TO VOTE, OR HOLDS PROXIES REPRESENTING FIVE PER CENT OR 589
MORE OF THE VOTING SECURITIES OF ANY OTHER PERSON. 590
13
Sec. 3913.35. (A) A MUTUAL INSURANCE HOLDING COMPANY, 593
AND, IF APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY, ARE DEEMED 594
TO BE INSURERS SUBJECT TO CHAPTER 3903. OF THE REVISED CODE. A 597
MUTUAL INSURANCE HOLDING COMPANY AND THE INTERMEDIATE HOLDING 598
COMPANY ACCORDINGLY ARE DEEMED TO BE PARTIES TO ANY PROCEEDING 599
UNDER CHAPTER 3903. OF THE REVISED CODE INVOLVING AN INSURANCE 602
COMPANY THAT IS A SUBSIDIARY OF THE MUTUAL INSURANCE HOLDING 603
COMPANY OR OF THE INTERMEDIATE HOLDING COMPANY AS A RESULT OF A 604
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE REVISED 607
CODE.
(B) IN ANY PROCEEDING UNDER CHAPTER 3903. OF THE REVISED 612
CODE INVOLVING A REORGANIZED STOCK COMPANY, THE ASSETS OF THE 613
MUTUAL INSURANCE HOLDING COMPANY, AND, IF APPLICABLE, ITS 614
INTERMEDIATE HOLDING COMPANY, ARE DEEMED TO BE ASSETS OF THE 615
REORGANIZED STOCK COMPANY FOR PURPOSES OF SATISFYING CLAIMS OF 616
THE POLICYHOLDERS OF THE REORGANIZED STOCK COMPANY. 617
(C) A MUTUAL INSURANCE HOLDING COMPANY, AND, IF 620
APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY, SHALL NOT BE 621
DISSOLVED OR LIQUIDATED WITHOUT COMPLIANCE WITH THE PROVISIONS OF 622
CHAPTER 3903. OF THE REVISED CODE. SUCH COMPANIES ARE DEEMED TO 625
BE DOMESTIC INSURANCE COMPANIES FOR PURPOSES OF A DISSOLUTION OR 626
LIQUIDATION UNDER CHAPTER 3903. OF THE REVISED CODE. 629
Sec. 3913.36. ANY ACTION CHALLENGING THE VALIDITY OF, OR 631
ARISING OUT OF, ACTIONS TAKEN OR PROPOSED TO BE TAKEN IN 632
CONNECTION WITH A REORGANIZATION UNDER SECTIONS 3913.25 TO 633
3913.37 OF THE REVISED CODE SHALL BE COMMENCED NO LATER THAN 636
THIRTY DAYS AFTER THE EFFECTIVE DATE OF THE REORGANIZATION. 637
Sec. 3913.37. THE SUPERINTENDENT OF INSURANCE MAY ADOPT 639
RULES IN ACCORDANCE WITH CHAPTER 119. OF THE REVISED CODE TO 643
CARRY OUT THE PURPOSES OF SECTIONS 3913.25 TO 3913.37 OF THE 645
REVISED CODE. 646
Sec. 3913.31 3913.40. (A) Any insurer that is organized 655
under the laws of another state and is admitted to transact the 657
business of insurance in this state may become a domestic insurer 658
14
by complying with all of the requirements of law relative to the 659
organization and licensing of a domestic insurer of the same type 660
and by designating its principal place of business at a place in 661
this state. Such a domestic insurer shall be issued like 662
certificates and licenses to transact business in this state, is 663
subject to the jurisdiction of this state, and shall be 664
recognized as an insurer formed under the laws of this state as 665
of the date of its original incorporation in its original 666
domiciliary state. The superintendent of insurance shall approve 667
any proposed transfer of domicile under this division unless he 668
determines that the transfer is not in the interest of 669
policyholders of this state. 670
(B) Any domestic insurer, upon the approval of the 672
superintendent, may transfer its domicile to any other state in 673
which it is admitted to transact the business of insurance. Upon 674
such a transfer, the insurer shall cease to be a domestic 675
insurer, and shall be admitted to this state if qualified as a 676
foreign insurer. The superintendent shall approve any proposed 677
transfer of domicile under this division unless he determines 678
that the transfer is not in the interest of policyholders of this 679
state. 680
(C)(1) With respect to any insurer that is licensed to 682
transact the business of insurance in this state and that 683
transfers its domicile to this or any other state by merger, 684
consolidation, or any other lawful method, both of the following 685
apply: 686
(a) The certificate of authority, agents appointments and 688
licenses, rates, and other items as allowed by the superintendent 689
that are in existence at the time of the transfer shall continue 690
in effect upon the transfer if the insurer remains qualified to 691
transact the business of insurance in this state. 692
(b) All outstanding policies shall remain in effect and 694
need not be endorsed as to the new name of the company or its new 695
location unless so ordered by the superintendent. 696
15
(2) Every transferring insurer as described in division 698
(C)(1) of this section shall file new policy forms with the 699
superintendent on or before the effective date of the transfer, 700
but may use existing policy forms with appropriate endorsements 701
if allowed by, and under such conditions as are approved by, the 702
superintendent. Every such insurer shall notify the 703
superintendent of the details of the proposed transfer, and shall 704
file promptly any resulting amendments to corporate documents 705
filed or required to be filed with the superintendent. 706
(D) The superintendent, in accordance with Chapter 119. of 708
the Revised Code, may adopt rules to carry out the purposes of 709
this section. 710
Section 2. That existing sections 3901.043 and 3913.31 of 712
the Revised Code are hereby repealed. 713