As Passed by the House 1
122nd General Assembly 4
Regular Session Am. Sub. H. B. No. 370 5
1997-1998 6
REPRESENTATIVES BATCHELDER-BUCHY-CAREY-CATES-COLONNA-GARCIA- 8
HAINES-HODGES-HOUSEHOLDER-JERSE-METELSKY-MOTTLEY-NETZLEY-REID- 9
SCHULER-STAPLETON-TAYLOR-TERWILLEGER-TIBERI-VAN VYVEN- 10
WACHTMANN-YOUNG-GRENDELL-CORBIN-HARRIS-HOTTINGER-JAMES- 11
O'BRIEN-OLMAN 12
14
A B I L L
To amend section 3901.043; to amend, for the purpose 16
of adopting a new section number as indicated in 18
parentheses, section 3913.31 (3913.40); and to 19
enact new section 3913.31 and sections 3913.25, 20
3913.26, 3913.27, 3913.28, 3913.29, 3913.30, 21
3913.32, 3913.33, 3913.34, 3913.35, 3913.36, and 22
3913.37 of the Revised Code to permit a mutual 23
insurance company to raise capital by 24
reorganizing as a stock insurance company that is 25
a majority-owned subsidiary of a mutual insurance 26
holding company. 27
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 29
Section 1. That section 3901.043 be amended, section 31
3913.31 (3913.40) be amended for the purpose of adopting a new 33
section number as indicated in parentheses, and new section 34
3913.31 and sections 3913.25, 3913.26, 3913.27, 3913.28, 3913.29, 35
3913.30, 3913.32, 3913.33, 3913.34, 3913.35, 3913.36, and 3913.37 36
of the Revised Code be enacted to read as follows: 37
Sec. 3901.043. The superintendent of insurance may adopt 46
rules in accordance with Chapter 119. of the Revised Code to 47
establish reasonable fees for any service or transaction 48
performed by the department of insurance pursuant to section 49
2
1738.04, 1742.03, 3901.321, 3901.341, 3907.09, 3907.10, 3907.11,
3907.12, 3911.011, 3913.31 3913.40, 3915.14, 3917.06, 3918.07, 51
3923.02, 3935.04, 3937.03, 3953.28, 3957.12, or 3957.13 of the 52
Revised Code or any provision in sections 3913.01 to 3913.23 or 53
in Chapter 3905. of the Revised Code, if no fee is otherwise 54
provided under Title XVII or XXXIX of the Revised Code for such 55
service or transaction. Any fee collected pursuant to those 56
rules shall be paid into the state treasury to the credit of the 57
department of insurance operating fund.
Sec. 3913.25. AS USED IN SECTIONS 3913.25 TO 3913.37 OF 59
THE REVISED CODE: 61
(A) "INTERMEDIATE HOLDING COMPANY" MEANS A STOCK 64
CORPORATION THAT OWNS ALL OF THE SHARES OF VOTING STOCK OF ONE OR 65
MORE REORGANIZED STOCK COMPANIES AFTER A REORGANIZATION UNDER 66
SECTIONS 3913.25 TO 3913.37 OF THE REVISED CODE. "INTERMEDIATE 68
HOLDING COMPANY" ALSO MEANS A STOCK CORPORATION THAT IS THE 69
PARENT OR SUBSIDIARY OF ANOTHER INTERMEDIATE HOLDING COMPANY. 70
(B) "MUTUAL INSURANCE COMPANY" MEANS A DOMESTIC OR FOREIGN 73
MUTUAL LIFE INSURANCE COMPANY OR A DOMESTIC OR FOREIGN MUTUAL 74
INSURANCE COMPANY OTHER THAN A MUTUAL LIFE INSURANCE COMPANY. 75
(C) "MUTUAL INSURANCE HOLDING COMPANY" MEANS A DOMESTIC 78
MUTUAL INSURANCE HOLDING COMPANY INCORPORATED PURSUANT TO A 79
REORGANIZATION PLAN ADOPTED UNDER SECTIONS 3913.26 TO 3913.28 OF 80
THE REVISED CODE, WHICH COMPANY IS THE PARENT COMPANY OF A 83
REORGANIZED STOCK COMPANY OR OF AN INTERMEDIATE HOLDING COMPANY. 84
(D) "POLICYHOLDER" HAS THE SAME MEANING AS IN SECTION 87
3913.10 OF THE REVISED CODE WHEN USED WITH RESPECT TO A LIFE 90
INSURANCE COMPANY, AND HAS THE SAME MEANING AS IN SECTION 3913.20 91
OF THE REVISED CODE WHEN USED WITH RESPECT TO AN INSURANCE 93
COMPANY OTHER THAN A LIFE INSURANCE COMPANY.
(E) "REORGANIZATION PLAN" MEANS A REORGANIZATION PLAN 96
ADOPTED BY A MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS IN 97
ACCORDANCE WITH SECTION 3913.26 OF THE REVISED CODE. 99
(F) "REORGANIZED STOCK COMPANY" MEANS THE DOMESTIC OR 102
3
FOREIGN STOCK INSURANCE COMPANY RESULTING FROM A DOMESTIC OR 103
FOREIGN MUTUAL INSURANCE COMPANY'S REORGANIZATION UNDER SECTIONS 104
3913.25 TO 3913.37 OF THE REVISED CODE. 106
(G) "VOTING STOCK" MEANS SECURITIES OF ANY CLASS OR ANY 109
OWNERSHIP INTEREST HAVING VOTING POWER FOR THE ELECTION OF 110
DIRECTORS, TRUSTEES, OR MANAGEMENT OF A PERSON, OTHER THAN 111
SECURITIES HAVING VOTING POWER ONLY AS A RESULT OF THE OCCURRENCE 112
OF A CONTINGENCY.
Sec. 3913.26. (A) A MUTUAL INSURANCE COMPANY, BY ITSELF 115
OR TOGETHER WITH ONE OR MORE OTHER MUTUAL INSURANCE COMPANIES 116
ACTING PURSUANT TO A JOINT REORGANIZATION PLAN, MAY REORGANIZE IN 117
ACCORDANCE WITH THE REQUIREMENTS OF SECTIONS 3913.25 TO 3913.37 118
OF THE REVISED CODE. 120
(B)(1) A MUTUAL INSURANCE COMPANY MAY ADOPT A 123
REORGANIZATION PLAN THAT IS CONSISTENT WITH THE REQUIREMENTS OF 124
SECTIONS 3913.25 TO 3913.37 OF THE REVISED CODE. SUCH A 126
REORGANIZATION PLAN MAY ONLY BE ADOPTED BY THE AFFIRMATIVE VOTE 127
OF NOT LESS THAN TWO-THIRDS OF THE MUTUAL INSURANCE COMPANY'S 128
BOARD OF DIRECTORS.
(2) AT ANY TIME PRIOR TO THE MAILING TO POLICYHOLDERS OF 130
THE NOTICE PURSUANT TO DIVISION (B) OF SECTION 3913.27 OF THE 133
REVISED CODE, WHICH NOTICE INCLUDES A SUMMARY OF THE 135
REORGANIZATION PLAN, A MUTUAL INSURANCE COMPANY'S BOARD OF 136
DIRECTORS MAY AMEND THE REORGANIZATION PLAN BY THE AFFIRMATIVE 137
VOTE OF NOT LESS THAN TWO-THIRDS OF THE BOARD OF DIRECTORS. AT 139
ANY TIME BEFORE A REORGANIZATION PLAN HAS RECEIVED THE APPROVAL 140
OF THE SUPERINTENDENT OF INSURANCE UNDER SECTION 3913.28 OF THE 141
REVISED CODE, A MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS MAY 143
WITHDRAW THE REORGANIZATION PLAN BY THE AFFIRMATIVE VOTE OF NOT 144
LESS THAN TWO-THIRDS OF THE BOARD OF DIRECTORS. 145
(C) A REORGANIZATION PLAN SHALL PROVIDE FOR THE 148
INCORPORATION OF A MUTUAL INSURANCE HOLDING COMPANY, AND SHALL 149
PROVIDE FOR THE CONTINUATION OF THE CORPORATE EXISTENCE OF THE 150
MUTUAL INSURANCE COMPANY AS A STOCK INSURANCE COMPANY. 151
4
(D) A REORGANIZATION PLAN SHALL PROVIDE THAT ALL OF THE 154
INITIAL SHARES OF VOTING STOCK OF A REORGANIZED STOCK COMPANY 155
SHALL BE ISSUED TO ITS PARENT MUTUAL INSURANCE HOLDING COMPANY OR 156
TO AN INTERMEDIATE HOLDING COMPANY. NOTHING IN SECTIONS 3913.25 157
TO 3913.37 OF THE REVISED CODE, HOWEVER, SHALL BE CONSTRUED AS 160
LIMITING OR RESTRICTING THE AUTHORITY OF A REORGANIZED STOCK 161
COMPANY OR OF AN INTERMEDIATE HOLDING COMPANY TO ISSUE SECURITIES 162
OTHER THAN VOTING STOCK.
(E)(1) A REORGANIZATION PLAN SHALL PROVIDE THAT THE 165
MEMBERSHIP INTERESTS OF THE POLICYHOLDERS OF A MUTUAL INSURANCE 166
COMPANY SHALL BECOME MEMBERSHIP INTERESTS IN THE MUTUAL INSURANCE 167
HOLDING COMPANY, AND THAT CONCURRENTLY THE POLICYHOLDERS' 168
MEMBERSHIP INTERESTS IN THE MUTUAL INSURANCE COMPANY SHALL BE 169
EXTINGUISHED.
(2) A REORGANIZATION PLAN SHALL PROVIDE THAT THE 171
POLICYHOLDERS OF THE REORGANIZED STOCK COMPANY SHALL BECOME 172
MEMBERS OF THE MUTUAL INSURANCE HOLDING COMPANY IN ACCORDANCE 173
WITH THE ARTICLES OF INCORPORATION AND THE CODE OF REGULATIONS OF 175
THE MUTUAL INSURANCE HOLDING COMPANY.
(F) A REORGANIZATION PLAN SHALL PROVIDE THAT THE MUTUAL 178
INSURANCE HOLDING COMPANY SHALL AT ALL TIMES OWN A MAJORITY OF 179
THE VOTING STOCK OF THE REORGANIZED STOCK COMPANY. 180
ALTERNATIVELY, A REORGANIZATION PLAN SHALL PROVIDE THAT THE 181
MUTUAL INSURANCE HOLDING COMPANY SHALL AT ALL TIMES OWN A 182
MAJORITY OF THE VOTING STOCK OF AN INTERMEDIATE HOLDING COMPANY, 183
WHICH INTERMEDIATE HOLDING COMPANY SHALL AT ALL TIMES OWN ALL OF 184
THE VOTING STOCK OF THE REORGANIZED STOCK COMPANY. THE SHARES OF 186
VOTING STOCK REQUIRED TO BE OWNED BY THE MUTUAL INSURANCE HOLDING 187
COMPANY, AND BY THE INTERMEDIATE HOLDING COMPANY, IF ANY, SHALL 188
NOT BE PLEDGED, HYPOTHECATED, OR IN ANY WAY ENCUMBERED WITH 189
REGARD TO ANY OBLIGATION, GUARANTY, OR COMMITMENT UNDERTAKEN BY 190
OR ON BEHALF OF THE MUTUAL INSURANCE HOLDING COMPANY, OR THE 191
INTERMEDIATE HOLDING COMPANY, IF ANY. 192
(G) THE BOARD OF DIRECTORS OF A MUTUAL INSURANCE COMPANY 195
5
SHALL FILE ALL OF THE FOLLOWING WITH THE SUPERINTENDENT WITHIN 196
NINETY DAYS AFTER ADOPTING A REORGANIZATION PLAN: 197
(1) THE REORGANIZATION PLAN; 199
(2) THE FORMS OF NOTICES TO BE PROVIDED TO POLICYHOLDERS 201
UNDER DIVISION (B) OF SECTION 3913.27 OF THE REVISED CODE; 204
(3) THE FORM OF PROXY, IF ANY, TO BE SOLICITED FROM 206
POLICYHOLDERS; 207
(4) THE PROPOSED ARTICLES OF INCORPORATION AND CODE OF 209
REGULATIONS FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE 210
REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, FOR AN 211
INTERMEDIATE HOLDING COMPANY. THE ARTICLES OF INCORPORATION AND 212
CODE OF REGULATIONS SHALL BE SIGNED BY THE CHAIRPERSON OF THE 213
BOARD, THE PRESIDENT OR VICE-PRESIDENT, AND BY THE SECRETARY OR 214
AN ASSISTANT SECRETARY, OF THE MUTUAL INSURANCE COMPANY. 215
(5) SUCH OTHER DOCUMENTS OR INFORMATION AS THE 217
SUPERINTENDENT MAY REQUIRE. 218
(H) NOTHING IN SECTIONS 3913.25 TO 3913.37 OF THE REVISED 222
CODE SHALL LIMIT OR RESTRICT AN INTERMEDIATE HOLDING COMPANY'S 224
AUTHORITY UNDER SECTION 1701.13 OF THE REVISED CODE TO FORM OR 226
ACQUIRE THE CONTROL OF OTHER CORPORATIONS, WHETHER DOMESTIC OR 227
FOREIGN, PROFIT OR NONPROFIT. 228
Sec. 3913.27. (A) A REORGANIZATION PLAN ADOPTED BY A 231
MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS PURSUANT TO SECTION 232
3913.26 OF THE REVISED CODE SHALL BE VOTED UPON BY A MUTUAL 235
INSURANCE COMPANY'S POLICYHOLDERS AT A POLICYHOLDERS' MEETING. A 236
POLICYHOLDER IS ENTITLED TO CAST ONLY ONE VOTE, IN PERSON OR BY 237
PROXY, ON THE REORGANIZATION PLAN REGARDLESS OF THE NUMBER OF 238
POLICIES OR CONTRACTS THAT THE POLICYHOLDER MAY OWN OR HOLD. 239
ONLY PROXIES SPECIFICALLY RELATED TO THE REORGANIZATION PLAN 241
SHALL BE USED IN DETERMINING WHETHER THE REORGANIZATION PLAN IS 242
APPROVED PURSUANT TO DIVISION (C) OF THIS SECTION. 243
(B) ALL POLICYHOLDERS SHALL BE GIVEN NOTICE OF THE 246
POLICYHOLDERS' MEETING TO VOTE UPON THE REORGANIZATION PLAN AT 247
LEAST THIRTY DAYS PRIOR TO THE DATE FIXED FOR THE POLICYHOLDERS' 248
6
MEETING. NOTICE OF THE TIME AND PLACE OF SUCH MEETING SHALL BE 249
SENT BY MAIL TO EACH POLICYHOLDER AT THE POLICYHOLDER'S POST 250
OFFICE ADDRESS AS IT APPEARS ON THE BOOKS AND RECORDS OF THE 251
COMPANY. THE NOTICE SHALL INCLUDE A SUMMARY OF THE 253
REORGANIZATION PLAN ADOPTED BY THE BOARD OF DIRECTORS, INCLUDING 255
AN ANALYSIS OF THE MATERIAL FINANCIAL ASPECTS AND POTENTIAL FOR 256
DILUTION OF POLICYHOLDERS' INTERESTS IN THE MUTUAL INSURANCE 257
COMPANY UNDER THE REORGANIZATION PLAN, A UNIFORM BALLOT FOR 258
VOTING ON THE QUESTION OF THE REORGANIZATION PLAN, AND A 259
STATEMENT INFORMING THE POLICYHOLDERS THAT THE SUPERINTENDENT OF 260
INSURANCE MAY FIX A TIME AND PLACE FOR A PUBLIC HEARING ON THE 261
REORGANIZATION PLAN, TO BE HELD WITHIN THIRTY DAYS AFTER THE 262
SUPERINTENDENT'S RECEIPT OF WRITTEN NOTICE FROM THE BOARD OF 263
DIRECTORS OF THE POLICYHOLDERS' APPROVAL OF THE REORGANIZATION 264
PLAN. 265
(C) A REORGANIZATION PLAN SHALL BE APPROVED UPON RECEIVING 268
THE AFFIRMATIVE VOTE OF AT LEAST A MAJORITY OF THE VOTES CAST BY 269
POLICYHOLDERS.
(D)(1) IF A REORGANIZATION PLAN IS APPROVED AT THE 272
POLICYHOLDERS' MEETING, THE BOARD OF DIRECTORS OF A MUTUAL 273
INSURANCE COMPANY SHALL PROVIDE THE SUPERINTENDENT WITH WRITTEN 274
NOTICE OF THAT APPROVAL WITHIN TEN DAYS AFTER THE POLICYHOLDERS' 275
MEETING. 276
(2) THE SUPERINTENDENT MAY, WITHIN TEN DAYS AFTER 278
RECEIVING THE NOTICE FROM THE BOARD OF DIRECTORS, PROVIDE WRITTEN 280
NOTICE TO THE MUTUAL INSURANCE COMPANY OF THE SUPERINTENDENT'S 281
INTENT TO CONDUCT ONE OR MORE PUBLIC HEARINGS ON THE 282
REORGANIZATION PLAN. AT A MINIMUM, THE SUPERINTENDENT'S NOTICE 283
TO THE MUTUAL INSURANCE COMPANY SHALL INCLUDE A TIME AND A PLACE 284
FOR THE FIRST PUBLIC HEARING, WHICH SHALL BE HELD WITHIN THIRTY 285
DAYS AFTER THE SUPERINTENDENT'S RECEIPT OF THE NOTICE FROM THE 286
BOARD OF DIRECTORS.
(3) WITHIN TEN DAYS AFTER THE MUTUAL INSURANCE COMPANY'S 288
RECEIPT OF A NOTICE FROM THE SUPERINTENDENT OF THE 289
7
SUPERINTENDENT'S INTENT TO CONDUCT ONE OR MORE PUBLIC HEARINGS ON 291
THE REORGANIZATION PLAN, IF SUCH NOTICE IS PROVIDED, THE MUTUAL 292
INSURANCE COMPANY SHALL PROVIDE NOTICE OF THE TIME AND PLACE OF 293
SUCH HEARING BY CAUSING THIS INFORMATION TO BE PUBLISHED ONCE 294
EACH WEEK FOR TWO CONSECUTIVE WEEKS IN A NEWSPAPER PUBLISHED AND 295
OF THE LARGEST CIRCULATION IN THE COUNTIES OF CUYAHOGA, FRANKLIN, 296
HAMILTON, AND LUCAS, IN THE COUNTY IN THIS STATE IN WHICH THE 298
MUTUAL INSURANCE COMPANY HAS ITS PRINCIPAL OFFICE, AND IN THE 299
NEWSPAPER OF THE LARGEST CIRCULATION IN THE STATE CAPITAL OF EACH 300
STATE OF THE UNITED STATES IN WHICH THE COMPANY MAINTAINS AN 301
OFFICE OR AGENCY FOR THE SOLICITATION OF INSURANCE. 302
(E) THE PROPOSED ARTICLES OF INCORPORATION AND CODE OF 305
REGULATIONS FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE 306
REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, FOR AN 307
INTERMEDIATE HOLDING COMPANY, AS FILED WITH THE SUPERINTENDENT 308
PURSUANT TO DIVISION (G)(4) OF SECTION 3913.26 OF THE REVISED 311
CODE, SHALL ALSO BE VOTED UPON BY THE MUTUAL INSURANCE COMPANY'S 312
POLICYHOLDERS AT THE POLICYHOLDERS' MEETING HELD PURSUANT TO THIS 313
SECTION. THE ARTICLES OF INCORPORATION AND CODE OF REGULATIONS 314
SHALL BE ADOPTED UPON RECEIVING THE AFFIRMATIVE VOTE OF AT LEAST 315
A MAJORITY OF THE VOTES CAST BY POLICYHOLDERS. 316
(F) AT ALL PUBLIC HEARINGS CONDUCTED BY THE SUPERINTENDENT 319
PURSUANT TO THE SUPERINTENDENT'S AUTHORITY UNDER DIVISION (D)(2) 321
OF THIS SECTION, THE SUPERINTENDENT MAY SUMMON AND COMPEL THE 322
ATTENDANCE AND TESTIMONY OF WITNESSES AND THE PRODUCTION OF BOOKS 323
AND PAPERS. THE SUPERINTENDENT SHALL HEAR THE TESTIMONY OF 325
PERSONS CLAIMING TO BE ADVERSELY AFFECTED BY THE REORGANIZATION 326
PLAN, AND OF OTHERS WISHING TO COMMENT ON THE REORGANIZATION 327
PLAN. SUCH PERSONS MAY PRESENT A POSITION AND OFFER COMMENTS 330
CONCERNING THE REORGANIZATION PLAN, INCLUDING A POSITION AND 331
COMMENTS CONCERNING WHETHER THE REORGANIZATION PLAN IS FAIR AND 332
EQUITABLE TO THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS AND 333
WHETHER IT COMPLIES WITH SECTIONS 3913.25 TO 3913.37 OF THE 334
REVISED CODE.
8
(G) A MUTUAL INSURANCE COMPANY'S FAILURE TO PROVIDE A 337
MEMBER OR MEMBERS WITH THE NOTICE REQUIRED BY THIS SECTION SHALL 338
NOT IMPAIR THE VALIDITY OF ANY ACTION TAKEN UNDER SECTIONS 339
3913.25 TO 3913.37 OF THE REVISED CODE, IF THE MUTUAL INSURANCE 341
COMPANY HAS COMPLIED SUBSTANTIALLY AND IN GOOD FAITH WITH ALL 342
NOTICE REQUIREMENTS. THE DETERMINATION AS TO SUCH COMPLIANCE 344
SHALL BE MADE BY THE SUPERINTENDENT. 345
Sec. 3913.28. (A) A MUTUAL INSURANCE COMPANY SHALL NOT 348
PROCEED WITH A REORGANIZATION PLAN APPROVED BY THE MUTUAL 349
INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION 3913.27 OF THE 351
REVISED CODE UNTIL THE REORGANIZATION PLAN HAS BEEN REVIEWED BY, 353
AND HAS RECEIVED THE APPROVAL OF, THE SUPERINTENDENT OF 354
INSURANCE, AND THE ARTICLES OF INCORPORATION FOR THE MUTUAL 355
INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK COMPANY, AND, 356
IF APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY, HAVE BEEN 357
EXAMINED AND APPROVED BY THE ATTORNEY GENERAL IN ACCORDANCE WITH 360
THIS SECTION.
(B) THE SUPERINTENDENT SHALL APPROVE A REORGANIZATION PLAN 363
IF, UPON REVIEW, THE SUPERINTENDENT FINDS ALL OF THE FOLLOWING: 364
(1) THE ADOPTION, APPROVAL, AND CONTENTS OF THE 366
REORGANIZATION PLAN COMPLY WITH SECTIONS 3913.25 TO 3913.37 OF 367
THE REVISED CODE; 369
(2) THE MUTUAL INSURANCE COMPANY HAS PROPERLY FILED ALL 371
DOCUMENTS, FORMS, AND OTHER INFORMATION REQUIRED BY DIVISION (G) 373
OF SECTION 3913.26 OF THE REVISED CODE; 375
(3) THE REORGANIZATION PLAN IS FAIR AND EQUITABLE TO THE 377
MUTUAL INSURANCE COMPANY'S POLICYHOLDERS. 378
(C) THE SUPERINTENDENT MAY RETAIN QUALIFIED EXPERTS, AT 381
THE MUTUAL INSURANCE COMPANY'S EXPENSE, TO ASSIST IN REVIEWING 382
THE REORGANIZATION PLAN.
(D) THE SUPERINTENDENT SHALL APPROVE OR REJECT A 385
REORGANIZATION PLAN NOT LATER THAN SIXTY DAYS AFTER THE LATER OF 386
THE APPROVAL OF THE REORGANIZATION PLAN BY THE MUTUAL INSURANCE 387
COMPANY'S POLICYHOLDERS OR THE COMPLETION OF PUBLIC HEARINGS HELD 388
9
IN ACCORDANCE WITH SECTION 3913.27 OF THE REVISED CODE. THE 391
SUPERINTENDENT MAY EXTEND THIS TIME PERIOD BY AN ADDITIONAL SIXTY 392
DAYS BY PROVIDING WRITTEN NOTICE TO THE MUTUAL INSURANCE COMPANY. 393
(E) UPON DECIDING TO APPROVE OR TO REJECT A REORGANIZATION 396
PLAN, THE SUPERINTENDENT SHALL NOTIFY THE MUTUAL INSURANCE 397
COMPANY OF THE DECISION BY REGULAR MAIL. IF THE SUPERINTENDENT 398
REJECTS A REORGANIZATION PLAN, THE SUPERINTENDENT'S NOTICE SHALL 399
DETAIL THE REASONS FOR THE REJECTION. 400
(F) A MUTUAL INSURANCE COMPANY SHALL FILE THE FOLLOWING 403
DOCUMENTS WITH THE SUPERINTENDENT WITHIN THIRTY DAYS AFTER 404
RECEIVING NOTICE FROM THE SUPERINTENDENT OF THE SUPERINTENDENT'S 405
APPROVAL OF A REORGANIZATION PLAN: 406
(1) THE MINUTES OF THE POLICYHOLDERS' MEETING AT WHICH THE 409
REORGANIZATION PLAN WAS APPROVED;
(2) THE ARTICLES OF INCORPORATION AND CODE OF REGULATIONS 411
FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED 412
STOCK COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING 413
COMPANY, AS ADOPTED BY THE MUTUAL INSURANCE COMPANY'S 414
POLICYHOLDERS UNDER SECTION 3913.27 OF THE REVISED CODE. 417
(G)(1) A MUTUAL INSURANCE COMPANY SHALL SUBMIT THE 420
ARTICLES OF INCORPORATION FOR THE MUTUAL INSURANCE HOLDING 421
COMPANY AND THE REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, 422
FOR AN INTERMEDIATE HOLDING COMPANY, AS ADOPTED BY THE MUTUAL 423
INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION 3913.27 OF THE 425
REVISED CODE, TO THE ATTORNEY GENERAL FOR THE ATTORNEY GENERAL'S 427
EXAMINATION AND APPROVAL. IF, UPON EXAMINATION, THE ATTORNEY 428
GENERAL FINDS THAT THE ARTICLES OF INCORPORATION ARE IN 429
ACCORDANCE WITH APPLICABLE SECTIONS OF THE REVISED CODE, AND NOT 431
INCONSISTENT WITH THE CONSTITUTION AND LAWS OF THE UNITED STATES 434
AND OF THIS STATE, THE ATTORNEY GENERAL SHALL APPROVE OF THE 435
ARTICLES OF INCORPORATION. THE ATTORNEY GENERAL SHALL NOTIFY THE 436
MUTUAL INSURANCE COMPANY OF THE APPROVAL BY REGULAR MAIL. 437
(2) UPON OBTAINING THE APPROVALS OF THE SUPERINTENDENT AND 440
THE ATTORNEY GENERAL UNDER THIS SECTION, THE MUTUAL INSURANCE 441
10
COMPANY'S BOARD OF DIRECTORS SHALL FILE THE FOLLOWING WITH THE 442
SECRETARY OF STATE:
(a) A CERTIFICATE OF REORGANIZATION, SIGNED BY THE 444
CHAIRPERSON OF THE BOARD, THE PRESIDENT OR A VICE-PRESIDENT, AND 445
THE SECRETARY OR AN ASSISTANT SECRETARY OF THE MUTUAL INSURANCE 446
COMPANY. THE ARTICLES OF INCORPORATION FOR THE MUTUAL INSURANCE 447
HOLDING COMPANY AND THE REORGANIZED STOCK COMPANY, AND, IF 448
APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY, AS ADOPTED BY 449
THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION 450
3913.27 OF THE REVISED CODE, SHALL ACCOMPANY THE CERTIFICATE OF 453
REORGANIZATION.
(b) A STATEMENT, SIGNED BY THE CHAIRPERSON OF THE BOARD, 456
THE PRESIDENT OR A VICE-PRESIDENT, AND THE SECRETARY OR AN 457
ASSISTANT SECRETARY, OF THE MUTUAL INSURANCE COMPANY, OF THE
MANNER OF THE ADOPTION OF THE ARTICLES OF INCORPORATION FOR THE 458
MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK 459
COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY; 461
(c) COPIES OF THE APPROVALS OBTAINED FROM THE 463
SUPERINTENDENT AND ATTORNEY GENERAL UNDER THIS SECTION. 464
(H) A REORGANIZATION PLAN SHALL BE EFFECTIVE UPON THE 467
FILING OF ALL OF THE DOCUMENTS AND STATEMENTS REQUIRED BY 468
DIVISION (G) OF THIS SECTION, OR AT SUCH LATER DATE AS THE 470
CERTIFICATE OF REORGANIZATION MAY PROVIDE. 471
(I) AFTER A REORGANIZATION PLAN TAKES EFFECT, THE 474
SUPERINTENDENT SHALL HAVE JURISDICTION OVER THE MUTUAL INSURANCE 475
HOLDING COMPANY, AND, IF APPLICABLE, OVER AN INTERMEDIATE HOLDING 476
COMPANY, IN ORDER TO ENSURE THAT THE INTERESTS OF THE MUTUAL 477
INSURANCE COMPANY'S POLICYHOLDERS ARE PROTECTED. 478
Sec. 3913.29. (A) PROPOSED AMENDMENTS TO THE ARTICLES OF 481
INCORPORATION OF A MUTUAL INSURANCE HOLDING COMPANY MAY BE 483
ADOPTED AT ANY MEMBERS' MEETING. THE BOARD OF DIRECTORS OF A 484
MUTUAL INSURANCE HOLDING COMPANY SHALL PROVIDE NOTICE OF ANY 485
MEMBERS' MEETING CONDUCTING A VOTE ON THE ADOPTION OF AN 486
AMENDMENT TO THE ARTICLES OF INCORPORATION IN A NEWSPAPER OF 487
11
GENERAL CIRCULATION PUBLISHED IN THE COUNTY WHERE THE COMPANY'S 488
PRINCIPAL PLACE OF BUSINESS IS LOCATED, AT LEAST THIRTY DAYS 489
PRIOR TO THE MEMBERS' MEETING. WHERE THE AMENDMENT IS NOT 490
INCONSISTENT WITH THE CONSTITUTION AND LAWS OF THIS STATE AND OF 491
THE UNITED STATES, THE AMENDMENT MAY BE ADOPTED BY THE 494
AFFIRMATIVE VOTE OF AT LEAST THREE-FIFTHS OF THE MEMBERS PRESENT 495
AND VOTING AT THE MEETING. AFTER ADOPTING AN AMENDMENT, THE 496
BOARD OF DIRECTORS SHALL SUBMIT THE AMENDMENT TO THE ATTORNEY 497
GENERAL FOR EXAMINATION AND APPROVAL.
(B) IF, UPON EXAMINATION, THE ATTORNEY GENERAL FINDS THAT 500
THE AMENDMENTS ADOPTED AT THE MEMBERS' MEETING ARE IN ACCORDANCE 501
WITH APPLICABLE SECTIONS OF THE REVISED CODE, AND ARE NOT 504
INCONSISTENT WITH THE CONSTITUTION AND LAWS OF THE UNITED STATES 507
AND OF THIS STATE, THE ATTORNEY GENERAL SHALL APPROVE OF THE 508
AMENDMENT TO THE ARTICLES OF INCORPORATION. 509
(C) UPON RECEIVING THE APPROVAL OF THE ATTORNEY GENERAL, 512
THE AMENDMENT AND A CERTIFICATE OF THE ATTORNEY GENERAL'S 513
APPROVAL SHALL BE FILED IN THE OFFICE OF THE SECRETARY OF STATE, 514
AND SHALL THEREUPON BE IN EFFECT. AFTER RECORDING THE AMENDMENT, 515
THE SECRETARY OF STATE SHALL DEPOSIT A COPY THEREOF WITH THE 516
SUPERINTENDENT OF INSURANCE. 517
Sec. 3913.30. (A) UPON A REORGANIZATION PLAN TAKING 520
EFFECT IN ACCORDANCE WITH SECTION 3913.28 OF THE REVISED CODE, 522
THE CORPORATE EXISTENCE OF THE MUTUAL INSURANCE COMPANY SHALL 523
CONTINUE IN THE REORGANIZED STOCK COMPANY. ON THE EFFECTIVE DATE 524
OF THE REORGANIZATION, ALL OF THE ASSETS, RIGHTS, FRANCHISES, AND 525
INTERESTS OF THE MUTUAL INSURANCE COMPANY IN AND TO EVERY SPECIES 527
OF PROPERTY, WHETHER REAL, PERSONAL, OR MIXED, AND ANY
ACCOMPANYING CHOSES IN ACTION, SHALL BE VESTED IN THE REORGANIZED 529
STOCK COMPANY, WITHOUT ANY DEED OR TRANSFER, AND THE REORGANIZED 530
STOCK COMPANY SHALL ASSUME ALL THE OBLIGATIONS AND LIABILITIES OF 531
THE MUTUAL INSURANCE COMPANY.
(B) UNLESS OTHERWISE SPECIFIED IN A REORGANIZATION PLAN, 534
THOSE PERSONS WHO ARE THE DIRECTORS AND OFFICERS OF A MUTUAL 535
12
INSURANCE COMPANY ON THE EFFECTIVE DATE OF THE REORGANIZATION 536
SHALL SERVE AS THE DIRECTORS AND OFFICERS OF THE REORGANIZED 537
STOCK COMPANY UNTIL NEW DIRECTORS AND OFFICERS ARE ELECTED 538
PURSUANT TO THE REORGANIZED STOCK COMPANY'S ARTICLES OF 539
INCORPORATION AND CODE OF REGULATIONS. 540
Sec. 3913.31. ALL COSTS AND EXPENSES OF THE PROCESS OF A 542
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE REVISED 545
CODE SHALL BE PAID FOR OR REIMBURSED BY THE MUTUAL INSURANCE 546
COMPANY, THE REORGANIZED STOCK COMPANY, OR AN INTERMEDIATE 547
HOLDING COMPANY.
Sec. 3913.32. (A) A MUTUAL INSURANCE COMPANY MAY 550
REORGANIZE BY MERGING ITS POLICYHOLDERS' MEMBERSHIP INTERESTS 551
INTO A DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING COMPANY AND 552
CONTINUING THE CORPORATE EXISTENCE OF THE MUTUAL INSURANCE 553
COMPANY AS A REORGANIZED STOCK COMPANY. A MUTUAL INSURANCE 554
COMPANY REORGANIZING UNDER THIS SECTION SHALL COMPLY WITH ALL 555
APPLICABLE PROVISIONS OF SECTIONS 3913.25 TO 3913.37 OF THE 557
REVISED CODE, AND ALL APPLICABLE LAWS OF FOREIGN JURISDICTIONS, 559
TO EFFECT THE REORGANIZATION.
(B) A DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING COMPANY 562
MAY REORGANIZE BY MERGING OR CONSOLIDATING ITS MEMBERSHIP 563
INTERESTS INTO ANOTHER DOMESTIC OR FOREIGN MUTUAL INSURANCE 564
HOLDING COMPANY. A DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING 565
COMPANY REORGANIZING UNDER THIS DIVISION SHALL COMPLY WITH ALL 566
APPLICABLE PROVISIONS OF SECTIONS 3913.25 TO 3913.37 OF THE 568
REVISED CODE, AND ALL APPLICABLE LAWS OF FOREIGN JURISDICTIONS, 570
TO EFFECT THE REORGANIZATION.
Sec. 3913.33. A MEMBERSHIP INTEREST IN A MUTUAL INSURANCE 572
HOLDING COMPANY IS NOT A SECURITY UNDER THE LAWS OF THIS STATE. 573
NO MEMBER OF A MUTUAL INSURANCE HOLDING COMPANY MAY TRANSFER 574
MEMBERSHIP IN THE MUTUAL INSURANCE HOLDING COMPANY OR ANY RIGHT 575
ARISING FROM MEMBERSHIP. 576
Sec. 3913.34. (A) SECTIONS 3913.11 TO 3913.13 AND 3913.20 579
TO 3913.23 OF THE REVISED CODE SHALL APPLY TO A MUTUAL INSURANCE 582
13
HOLDING COMPANY AS IF THE MUTUAL INSURANCE HOLDING COMPANY WERE A 583
DOMESTIC MUTUAL INSURANCE COMPANY. THE MEMBERS OF THE MUTUAL 584
INSURANCE HOLDING COMPANY ARE DEEMED TO BE MEMBERS OF A DOMESTIC 585
MUTUAL INSURANCE COMPANY FOR ALL PURPOSES OF SUCH SECTIONS. 586
(B) A REORGANIZATION OF A DOMESTIC MUTUAL LIFE INSURANCE 589
COMPANY SUBJECT TO SECTIONS 3913.25 TO 3913.37 OF THE REVISED 592
CODE ALSO IS SUBJECT TO SECTIONS 3907.09 TO 3907.11 OF THE 594
REVISED CODE, IF APPLICABLE, BUT IS NOT SUBJECT TO SECTIONS 596
3901.32 TO 3901.323 OF THE REVISED CODE. 598
(C) NOTWITHSTANDING DIVISION (B) OF THIS SECTION, FOR A 602
PERIOD OF FIVE YEARS FOLLOWING THE EFFECTIVE DATE OF A
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE REVISED 605
CODE, NO PERSON SHALL ACQUIRE CONTROL OF A REORGANIZED STOCK 606
COMPANY WITHOUT COMPLIANCE WITH SECTIONS 3901.32 TO 3901.323 OF 607
THE REVISED CODE. FOR PURPOSES OF THIS DIVISION, "CONTROL" HAS 610
THE SAME MEANING AS IN DIVISION (B) OF SECTION 3901.32 OF THE 612
REVISED CODE, EXCEPT THAT CONTROL IS PRESUMED TO EXIST IF ANY 614
PERSON, DIRECTLY OR INDIRECTLY, OWNS, CONTROLS, HOLDS WITH THE 615
POWER TO VOTE, OR HOLDS PROXIES REPRESENTING FIVE PER CENT OR 616
MORE OF THE VOTING SECURITIES OF ANY OTHER PERSON. 617
(D) BEFORE A REORGANIZED STOCK COMPANY OR INTERMEDIATE 619
HOLDING COMPANY MAY ISSUE SHARES OF STOCK IN ADDITION TO THE 620
SHARES ISSUED PURSUANT TO THE REORGANIZATION PLAN UNDER WHICH IT 621
WAS FORMED, ITS BOARD OF DIRECTORS SHALL DELIVER TO THE 622
CHAIRPERSON OR SECRETARY OF THE BOARD OF DIRECTORS OF THE PARENT 623
MUTUAL INSURANCE HOLDING COMPANY A COPY OF THE RESOLUTION
AUTHORIZING THE ISSUANCE OF THOSE SHARES AND A WRITTEN NOTICE 625
THAT THE ISSUANCE OF THE SHARES MAY OCCUR IN ACCORDANCE WITH THIS 626
SECTION IF THE BOARD OF DIRECTORS OF THE MUTUAL INSURANCE HOLDING 627
COMPANY DOES NOT DISAPPROVE ISSUANCE OF THE SHARES AS PROVIDED IN 628
THIS DIVISION.
IF, WITHIN THIRTY DAYS AFTER RECEIVING THE RESOLUTION AND 630
NOTICE DESCRIBED IN THIS DIVISION, THE BOARD OF DIRECTORS OF THE 631
MUTUAL INSURANCE HOLDING COMPANY ADOPTS AND DELIVERS TO THE 632
14
REORGANIZED STOCK COMPANY OR INTERMEDIATE HOLDING COMPANY A 633
RESOLUTION DISAPPROVING ISSUANCE OF THE SHARES, THE SHARES SHALL 634
NOT BE ISSUED. OTHERWISE, THE SHARES MAY BE ISSUED AFTER THE
THIRTY-DAY PERIOD EXPIRES OR AFTER THE BOARD OF DIRECTORS OF THE 635
MUTUAL INSURANCE HOLDING COMPANY ADOPTS AND DELIVERS TO THE 636
REORGANIZED STOCK COMPANY OR INTERMEDIATE HOLDING COMPANY A 637
RESOLUTION APPROVING ISSUANCE OF THE SHARES.
(E) A MUTUAL INSURANCE HOLDING COMPANY, AND AN 640
INTERMEDIATE HOLDING COMPANY, IF ANY, ARE DEEMED TO BE INSURERS 641
SUBJECT TO SECTIONS 3901.07, 3901.071, AND 3901.48 OF THE REVISED 643
CODE. 644
Sec. 3913.35. (A) A MUTUAL INSURANCE HOLDING COMPANY, 647
AND, IF APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY, ARE DEEMED 648
TO BE INSURERS SUBJECT TO SECTIONS 3903.01 TO 3903.76 OF THE 650
REVISED CODE. A MUTUAL INSURANCE HOLDING COMPANY AND THE 652
INTERMEDIATE HOLDING COMPANY ACCORDINGLY ARE DEEMED TO BE PARTIES 653
TO ANY PROCEEDING UNDER SECTIONS 3903.01 TO 3903.76 OF THE 655
REVISED CODE INVOLVING AN INSURANCE COMPANY THAT IS A SUBSIDIARY 657
OF THE MUTUAL INSURANCE HOLDING COMPANY OR OF THE INTERMEDIATE 658
HOLDING COMPANY AS A RESULT OF A REORGANIZATION UNDER SECTIONS 659
3913.25 TO 3913.37 OF THE REVISED CODE. 661
(B) IN ANY PROCEEDING UNDER SECTIONS 3903.01 TO 3903.76 OF 664
THE REVISED CODE INVOLVING A REORGANIZED STOCK COMPANY, THE 667
ASSETS OF THE MUTUAL INSURANCE HOLDING COMPANY, AND, IF 668
APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY, ARE DEEMED TO BE 669
ASSETS OF THE REORGANIZED STOCK COMPANY FOR PURPOSES OF 670
SATISFYING CLAIMS OF THE POLICYHOLDERS OF THE REORGANIZED STOCK 671
COMPANY.
(C) A MUTUAL INSURANCE HOLDING COMPANY, AND, IF 674
APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY, SHALL NOT BE 675
DISSOLVED OR LIQUIDATED WITHOUT COMPLIANCE WITH THE PROVISIONS OF 676
CHAPTER 3903. OF THE REVISED CODE. SUCH COMPANIES ARE DEEMED TO 679
BE DOMESTIC INSURANCE COMPANIES FOR PURPOSES OF A DISSOLUTION OR 680
LIQUIDATION UNDER CHAPTER 3903. OF THE REVISED CODE. 683
15
Sec. 3913.36. ANY ACTION CHALLENGING THE VALIDITY OF, OR 685
ARISING OUT OF, ACTIONS TAKEN OR PROPOSED TO BE TAKEN IN 686
CONNECTION WITH A REORGANIZATION UNDER SECTIONS 3913.25 TO 687
3913.37 OF THE REVISED CODE SHALL BE COMMENCED NO LATER THAN 690
THIRTY DAYS AFTER THE EFFECTIVE DATE OF THE REORGANIZATION. 691
Sec. 3913.37. THE SUPERINTENDENT OF INSURANCE MAY ADOPT 693
RULES IN ACCORDANCE WITH CHAPTER 119. OF THE REVISED CODE TO 697
CARRY OUT THE PURPOSES OF SECTIONS 3913.25 TO 3913.37 OF THE 699
REVISED CODE. 700
Sec. 3913.31 3913.40. (A) Any insurer that is organized 709
under the laws of another state and is admitted to transact the 711
business of insurance in this state may become a domestic insurer 712
by complying with all of the requirements of law relative to the 713
organization and licensing of a domestic insurer of the same type 714
and by designating its principal place of business at a place in 715
this state. Such a domestic insurer shall be issued like 716
certificates and licenses to transact business in this state, is 717
subject to the jurisdiction of this state, and shall be 718
recognized as an insurer formed under the laws of this state as 719
of the date of its original incorporation in its original 720
domiciliary state. The superintendent of insurance shall approve 721
any proposed transfer of domicile under this division unless he 722
THE SUPERINTENDENT determines that the transfer is not in the 724
interest of policyholders of this state. 725
(B) Any domestic insurer, upon the approval of the 727
superintendent, may transfer its domicile to any other state in 728
which it is admitted to transact the business of insurance. Upon 729
such a transfer, the insurer shall cease to be a domestic 730
insurer, and shall be admitted to this state if qualified as a 731
foreign insurer. The superintendent shall approve any proposed 732
transfer of domicile under this division unless he THE 733
SUPERINTENDENT determines that the transfer is not in the 735
interest of policyholders of this state. 736
(C)(1) With respect to any insurer that is licensed to 738
16
transact the business of insurance in this state and that 739
transfers its domicile to this or any other state by merger, 740
consolidation, or any other lawful method, both of the following 741
apply: 742
(a) The certificate of authority, agents appointments and 744
licenses, rates, and other items as allowed by the superintendent 745
that are in existence at the time of the transfer shall continue 746
in effect upon the transfer if the insurer remains qualified to 747
transact the business of insurance in this state. 748
(b) All outstanding policies shall remain in effect and 750
need not be endorsed as to the new name of the company or its new 751
location unless so ordered by the superintendent. 752
(2) Every transferring insurer as described in division 754
(C)(1) of this section shall file new policy forms with the 755
superintendent on or before the effective date of the transfer, 756
but may use existing policy forms with appropriate endorsements 757
if allowed by, and under such conditions as are approved by, the 758
superintendent. Every such insurer shall notify the 759
superintendent of the details of the proposed transfer, and shall 760
file promptly any resulting amendments to corporate documents 761
filed or required to be filed with the superintendent. 762
(D) The superintendent, in accordance with Chapter 119. of 764
the Revised Code, may adopt rules to carry out the purposes of 765
this section. 766
Section 2. That existing sections 3901.043 and 3913.31 of 768
the Revised Code are hereby repealed. 769