693A.625 - Issuance of initial shares of capital stock; identity and rights of policyholders; status, rights, duties and assets of holding company.
693A.625 Issuance of initial shares of capital stock; identity and rights of policyholders; status, rights, duties and assets of holding company.
1. All the initial shares of the capital stock of a reorganized stock insurer must be issued to the mutual insurance holding company or to one or more intermediate stock holding companies.
2. Policyholders of a domestic mutual insurer that has been reorganized are members of the mutual insurance holding company, and their voting rights must be determined in accordance with the articles of incorporation and bylaws of the mutual insurance holding company. The mutual insurance holding company shall provide its members with the same membership rights as were provided to policyholders of the mutual insurer immediately before reorganization. The reorganization must not reduce, limit or otherwise affect the number or identity of the policyholders who may become members of the mutual insurance holding company or secure for managerial personnel any unfair advantage through or connected with the reorganization.
3. A mutual insurance holding company or an intermediate stock holding company formed pursuant to NRS 693A.550 to 693A.665, inclusive:
(a) Must not be authorized to transact the business of insurance;
(b) Is subject to the jurisdiction of the Commissioner, who shall ensure that policyholder interests are protected; and
(c) Shall be deemed to be an insurer for the purposes of chapter 696B of NRS.
4. An intermediate stock holding company formed pursuant to NRS 693A.550 to 693A.665, inclusive, shall be deemed to be a mutual insurance holding company subject to the provisions of NRS 693A.400 to 693A.540, inclusive.
5. A mutual insurance holding company formed pursuant to NRS 693A.550 to 693A.665, inclusive:
(a) Shall not issue stock.
(b) Shall invest in insurers not less than 50 percent of its net worth as determined by generally accepted accounting practices.
6. The aggregate pledges and encumbrances of the assets of a mutual insurance holding company must not affect more than 49 percent of the mutual insurance holding company’s stock in an intermediate stock holding company or a reorganized stock insurer.
7. If any proceeding under chapter 696B of NRS is brought against a reorganized stock insurer, the mutual insurance holding company and each intermediate stock holding company must be named parties to the proceeding. All the assets of the mutual insurance holding company and each intermediate stock holding company shall be deemed assets of the estate of the reorganized stock insurer to the extent necessary to satisfy claims against the reorganized stock insurer.
8. No distribution to members of a mutual insurance holding company may occur without the prior written approval of the Commissioner. The Commissioner may give such approval only if the Commissioner is satisfied that the distribution is fair and equitable to policyholders as members of the mutual insurance holding company.
9. No solicitation for the sale of the stock of an intermediate stock holding company or a reorganized stock insurer may be made without the prior written approval of the Commissioner.
10. A mutual insurance holding company or an intermediate stock holding company may not voluntarily dissolve without the approval of the Commissioner.
(Added to NRS by 2001, 2245; A 2003, 3330)