SSB 3134 (LSB 6273XC (1) 90)

SENATE FILE _____ 

BY  (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON BROWN)

A BILL FOR

An Act relating to the names of reorganized mutual insurance companies.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 521A.14, subsection 1, paragraph a, Code 2024, is amended to read as follows:
   a.  A domestic mutual insurance company, upon approval of the commissioner, may reorganize by forming an insurance holding company based upon a mutual plan and continuing the corporate existence of the reorganizing insurance company as a stock insurance company.  The reorganized insurance company may continue to use the word “mutual” in the company’s name provided that the company’s name also includes the words “stock insurer”, or the abbreviation “SI”. The commissioner, after a public hearing as provided in section 521A.3, subsection 4, paragraph “b”, if satisfied that the interests of the policyholders are properly protected and that the plan of reorganization is fair and equitable to the policyholders, may approve the proposed plan of reorganization and may require as a condition of approval such modifications of the proposed plan of reorganization as the commissioner finds necessary for the protection of the policyholders’ interests. The commissioner may retain consultants as provided in section 521A.3, subsection 4, paragraph “d”. A reorganization pursuant to this section is subject to section 521A.3, subsections 1, 2, and 3. The commissioner shall retain jurisdiction over a mutual insurance holding company organized pursuant to this section to assure that policyholder interests are protected.
    Sec. 2.  Section 521A.14, subsection 2, paragraph a, Code 2024, is amended to read as follows:
   a.  A domestic mutual insurance company, upon the approval of the commissioner, may reorganize by merging its policyholders’ membership interests into a mutual insurance holding company formed pursuant to subsection 1 and continuing the corporate existence of the reorganizing insurance company as a stock insurance company subsidiary of the mutual insurance holding company.  The reorganized insurance company may continue to use the word “mutual” in the company’s name provided that the company’s name also includes the words “stock insurer”, or the abbreviation “SI”. The commissioner, after a public hearing as provided in section 521A.3, subsection 4, paragraph “b”, if satisfied that the interests of the policyholders are properly protected and that the merger is fair and equitable to the policyholders, may approve the proposed merger and may require as a condition of approval such modifications of the proposed merger as the commissioner finds necessary for the protection of the policyholders’ interests. The commissioner may retain consultants as provided in section 521A.3, subsection 4, paragraph “d”. A merger pursuant to this section is subject to section 521A.3, subsections 1, 2, and 3. The commissioner shall retain jurisdiction over the mutual insurance holding company organized pursuant to this section to assure that policyholder interests are protected.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the naming requirements for reorganized insurance companies.
   A domestic mutual insurance company that reorganizes by forming an insurance holding company may continue to use the word “mutual” in its name provided that its name also includes the words “stock insurer”, or the abbreviation “SI”.
   A domestic mutual insurance company that reorganizes by merging its policyholders’ membership interests into a mutual insurance holding company may continue to use the word “mutual” in its name provided that its name also includes the words “stock insurer”, or the abbreviation “SI”.