Sec. 38a-155. (Formerly Sec. 38-42b). Conversion of hospital and medical service corporation to mutual insurance company. Procedure. Authorized agents to sell products.
Sec. 38a-155. (Formerly Sec. 38-42b). Conversion of hospital and medical service corporation to mutual insurance company. Procedure. Authorized agents to
sell products. (a) Any consolidated hospital and medical service corporation organized
and formed pursuant to sections 38a-199 to 38a-209, inclusive, or sections 38a-214 to
38a-225, inclusive, in existence on July 1, 1982, and possessing contingency reserves in
an amount of fifty million dollars or more may, at its option and without reincorporation,
convert to a domestic mutual insurance company under the laws of this state (1) by
amending and restating its certificate of incorporation to grant it such powers consistent
with the provisions of this section, provided the amended and restated certificate of
incorporation shall not state that said domestic mutual insurance company is a nonprofit
corporation or that it is created under the Nonstock Corporation Act, and (2) by obtaining
a license pursuant to sections 38a-41 to operate as a domestic mutual insurance company.
(b) The board of directors of any such corporation electing to convert to a domestic
mutual insurance company shall adopt a resolution prior to October 1, 1984, declaring
the election of the corporation to make such conversion and to become subject to all of
the laws of the state governing such companies, except as limited by the terms of this
section. After the adoption of such resolution, the board of directors of such corporation
shall adopt such amendments to its certificate of incorporation as are consistent with
the provisions of this section and as are necessary for it to convert to a domestic mutual
insurance company and file such amended and restated certificate of incorporation with
the Secretary of the State. Such amendment shall designate the members of the company.
Any subsequent amendment to the certificate of incorporation shall be consistent with
the terms of this section.
(c) No such amended and restated certificate of incorporation shall be effective
unless and until it is filed with the Secretary of the State. Prior to the filing of such
certificate, the corporation shall apply to the Insurance Commissioner for a license pursuant to section 38a-41, provided such license, if issued, shall only become effective
upon the filing of the certificate. Upon the filing of such amended and restated certificate
of incorporation, the corporation shall be a domestic mutual insurance company and
shall not be a consolidated hospital and medical service corporation. Upon such filing
the company shall no longer be subject to the provisions of section 12-212a, sections
38a-199 to 38a-209, inclusive, or sections 38a-214 to 38a-225, inclusive.
(d) From the date of filing of such amended and restated certificate of incorporation,
such company shall be authorized to do a life, accident and health insurance business,
including any business or type of business which any other corporation now or hereafter
chartered by or incorporated in Connecticut and empowered to do a life, accident and
health insurance business may now or hereafter lawfully do; and the company is specifically empowered to accept and to cede reinsurance of any and all insurance risks or
hazards.
(e) No consolidated hospital and medical service corporation which converts to a
domestic mutual insurance company under this section shall thereafter be able to avail
itself of the provisions of either sections 38a-199 to 38a-209, inclusive, or sections
38a-214 to 38a-225, inclusive. Such company shall not organize or participate in the
organization of, revert or convert to the status of, own or organize a subsidiary which
is, have common management or directors with, or in any other way be affiliated with,
a corporation or other legal entity organized, formed or acting pursuant to said sections.
Until the filing with the Secretary of the State of the amended and restated certificate
of incorporation as provided herein, the permission currently granted to any such corporation by the Insurance Commissioner shall continue in full force and effect, and such
corporation shall continue to provide comprehensive health care and related services to
its present or future subscribers and covered persons by health care contracts and may
make provision for the payment for such health care services. Upon converting to a
domestic mutual insurance company, the company shall be subject to all of the laws
of the state governing domestic mutual insurance companies and, except as otherwise
provided in this section, shall have all of the powers of any other domestic mutual
insurance company now or hereafter chartered or incorporated by this state and empowered to do an insurance business including, but not limited to, the power to establish,
maintain, own and operate health care centers as a line of business.
(f) Upon the filing of the amended and restated certificate of incorporation with the
Secretary of the State, as provided by this section, the company shall be liable for taxes
under chapters 207 and 208 and for any other tax for which any other domestic mutual
insurance company is liable to the state or any political subdivision thereof.
(g) All insurance products sold through the insurance companies authorized by this
section and the insurance company authorized by section 4 of public act 84-323* shall
be available to be sold by any licensed independent agent, as provided in sections 38a-702j, 38a-703 to 38a-718, inclusive, 38a-731 to 38a-735, inclusive, 38a-741 to 38a-745, inclusive, 38a-769 to 38a-777, inclusive, 38a-786, 38a-790, 38a-792 and 38a-794
and so authorized by such insurance company.
(P.A. 84-323, S. 1, 3, 5, 6; P.A. 91-29, S. 2, 8; P.A. 93-229, S. 6, 21; P.A. 95-207, S. 8, 9; P.A. 01-113, S. 24, 42.)
*Note: Section 4 of public act 84-323 is special in nature and therefore has not been codified but remains in full force
and effect according to its terms.
History: Sec. 38-42b transferred to Sec. 38a-155 in 1991; P.A. 91-29 made technical changes in Subsec. (h) deleting
references to sections repealed by the same act; (Revisor's note: In 1993 references to Secs. 38a-94 to 38a-101, inclusive,
and 38a-966 to 38a-970, inclusive, repealed by P.A. 92-60, were deleted editorially by the Revisors); P.A. 93-229 deleted
former Subdiv. (1) containing obsolete provision re discount under Subsec. (h) of Sec. 19a-166, renumbering as necessary,
effective June 4, 1993; P.A. 95-207 made technical corrections to Subsecs. (c) and (g), in Subsec. (d) made an allowance
for an insurance company to transact life, accident and health insurance business and to accept and cede reinsurance in
lieu of writing accident and health insurance only, deleted former Subsec. (f) which provided a prohibition against any
corporation which converts to a domestic mutual insurance company, relettered the previous Subsecs. (g) and (h) as (f)
and (g) and deleted Subsec. (i), effective June 28, 1995; P.A. 01-113 amended Subsec. (g) to delete references to Secs.
38a-702 and 38a-795, and to substitute "section 38a-702j" for "section 38a-783", effective September 1, 2002.