MarylandHB 16162026 Regular SessionHouse

Mutual Insurance Holding Companies - Conversion to Mutual Insurers

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Bill Overview

Analyzed Economic Effects

4 provisions identified: 2 benefits, 0 costs, 2 mixed.

Members get big say on conversions

Beginning October 1, 2026, the board must approve any conversion plan by a majority vote. Members then vote at a meeting noticed in a Commissioner‑approved way that states the time, place, and purpose. At least 75% of votes cast in person, by proxy, or by mail must approve the plan.

Stronger policyholder protection in insolvency

Beginning October 1, 2026, a mutual insurance holding company cannot dissolve or liquidate except under Title 9 or through the conversion process. In any Title 9 case that involves its reorganized stock insurer subsidiary, the holding company must be a party. The holding company’s assets count as part of the insurer’s estate to pay the insurer’s policyholders’ claims.

Insurance regulator review and deadlines

Beginning October 1, 2026, companies must file a conversion plan with the Insurance Commissioner at least 60 days before the effective date. The filing includes amended articles and bylaws, a five‑year operations plan with asset and liability transfers, a list of officers and directors, and biographical affidavits, plus any other items the Commissioner requests. The Commissioner may approve in writing, or the plan is approved 60 days after full submission unless disapproved. The Commissioner must find the plan follows the law and is fair to members and policyholders, and may add conditions, hold hearings, and hire an outside expert at the company’s expense. The Commissioner may also issue regulations to carry out these rules.

Converting holding companies into mutual insurers

Beginning October 1, 2026, a mutual insurance holding company that owns 100% of a reorganized stock insurer can convert to a mutual insurer under an approved plan. On conversion, current membership interests become nontransferable membership in the new mutual insurer. Existing policies stay in force and may be endorsed, and future policyholders become members. The shares of the reorganized insurer and any intermediate holding company are retired, and those companies are dissolved by filing articles with the State Department of Assessments and Taxation. The converted mutual insurer must have surplus funds reasonably adequate to protect policyholders.

Sponsors & Cosponsors

Sponsor

Mike Rogers
Democratic • House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 179 • No: 0

Senate vote • 4/8/2026

Third Reading Passed

Yes: 43 • No: 0 • Other: 2

House vote • 3/23/2026