Title 18 — Insurance Code

§ 4908. Mutual insurers — Trust deposit of qualifying premiums; issuance of policies. (a) All sums collected by a domestic mutual corporation as premiums or fees on qualifying applications for insurance therein shall be deposited in trust in a bank or trust company in this State …

§ 4909. Mutual insurers — Failure to qualify. If the proposed domestic mutual insurer fails to complete its organization and to secure its original certificate of authority within 1 year from and after date of its solicitation permit, the corporation shall transact no further bus…

§ 4910. Mutual insurers — Additional kinds of insurance. A domestic mutual insurer, after being authorized to transact 1 kind of insurance, may be authorized to transact such additional kinds of insurance as are permitted under § 510 of this title, while otherwise in compliance w…

§ 4911. Membership in mutual. (a) Each policyholder of a domestic mutual insurer, other than of a reinsurance contract, is a member of the insurer during the period of the insurance with all rights and obligations of such membership, and the policy shall so specify. (b) Any perso…

§ 4912. Bylaws of mutual insurer. Every domestic mutual insurer shall promptly file with the Commissioner a copy, certified by the insurer’s secretary, of its bylaws and of every modification thereof or addition thereto. The bylaws and modifications thereof shall be subject to th…

§ 4913. Minutes of corporate meetings of mutual insurers. A domestic mutual insurer upon the Commissioner’s written request therefor shall promptly file with the Commissioner a copy, certified by the insurer’s secretary, of the notice, minutes and other record of every meeting of…

§ 4914. Contingent liability of mutual members. (a) Except as provided otherwise in § 4916 of this title with respect to nonassessable policies, each member of a domestic mutual insurer shall have a contingent liability, pro rata and not one for another, for the discharge of its …

§ 4915. Levy of contingent liability. (a) If at any time the assets of a domestic mutual insurer are less than its liabilities and the minimum amount of surplus required to be maintained by it under this title for authority to transact the kinds of insurance being transacted and …

§ 4916. Enforcement of contingent liability. (a) The insurer shall notify each member of the amount of the assessment to be paid by written notice mailed to the address of the member last of record with the insurer. Failure of the member to receive the notice so mailed, within th…

§ 4917. Nonassessable policies, mutual insurers; revocation of authority. (a) A domestic mutual insurer, by depositing through the Commissioner and thereafter maintaining unimpaired surplus funds not less in amount than the minimum paid-in capital stock required of a domestic sto…

§ 4918. Information to stockholders and proxy regulations. (a) This section shall apply to all domestic stock insurers except: (1) A domestic stock insurer having less than 100 stockholders, except, that if 95% or more of the insurer’s stock is owned or controlled by a parent or …

§ 4919. Change of directors, officers; notice. Every domestic stock or mutual insurer shall promptly notify the Commissioner in writing of any change of personnel among its directors or principal officers.18 Del. C. 1953, § 4919; 56 Del. Laws, c. 380, § 1;

§ 4920. Prohibited pecuniary interest of officials. (a) Any officer or director, or any member of any committee or an employee of a domestic insurer, having the duty or power of investing or handling the insurer’s funds, shall not deposit or invest such funds except in the insure…

§ 4921. Management and exclusive agency contracts. (a) No domestic insurer shall hereafter make any contract whereby any person is granted or is to enjoy in fact the management of the insurer to the material exclusion of its board of directors or to have the controlling or preemp…

§ 4922. Dividends to stockholders. (a) A domestic stock insurer shall not pay any cash dividend to stockholders except out of that part of its available and accumulated surplus funds which is derived from realized net operating profits on its business and realized capital gains. …

§ 4923. Participating policies. (a) If provided for in its certificate of incorporation or charter, a stock insurer or mutual insurer may issue any or all of its policies or contracts with or without participation in profits, savings, unabsorbed portions of premiums, or surplus, …

§ 4924. Dividends to policyholders. (a) The directors of a domestic mutual insurer may from time to time apportion and pay or credit to its members dividends only out of that part of its surplus funds which represents net realized savings, net realized earnings, and net realized …

§ 4925. Solicitation of business; issuance of policies in other jurisdictions. (a) No domestic insurer shall knowingly solicit insurance business in any reciprocating state in which not then licensed as an authorized insurer. This subsection shall not prohibit advertising through…

§ 4926. Payment of taxes; exoneration. (a) Every domestic insurer may comply with any law of any state or political subdivision imposing any license, excise, privilege, premium, occupation or other fee or tax, and pay such fee or tax, unless prior to such payment the law shall ha…

§ 4927. Impairment of capital or assets. (a) If a domestic stock insurer’s paid-in capital stock (as represented by the aggregate par value of its outstanding capital stock) or capital account (of an insurance department or division of a corporation established under Chapter 7 of…

§ 4928. Mutualization of stock insurer. (a) A stock insurer other than a title insurer may become a mutual insurer under such plan and procedure as may be approved by the Commissioner after a hearing thereon. (b) The Commissioner shall not approve any such plan, procedure or mutu…

§ 4929. Conversion to ordinary business corporation. (a) A domestic stock insurer may convert to a Delaware ordinary business corporation through the following procedures: (1) The insurer must give the Commissioner written notice of its intent to convert to an ordinary business c…

§ 4930. Merger, consolidation of stock insurers. (a) A domestic stock insurer may merge or consolidate with 1 or more domestic or foreign stock insurers by complying with the applicable provisions of the statutes of this State governing the merger or consolidation of stock corpor…

§ 4931. Affiliation of stock insurers. (a) A domestic stock insurer shall not acquire a controlling interest in the shares of another stock insurer by an exchange of securities or partly in exchange for securities and partly for cash or property, unless the insurer has first subm…

§ 4932. Acquisition of controlling stock. Repealed by 68 Del. Laws, c. 325, § 3, effective Aug. 7, 1992.

§ 4933. Converting mutual insurer. Repealed by 77 Del. Laws, c. 466, § 1, effective Oct. 17, 2010.

§ 4934. Merger, consolidation — Allowable circumstances; “surviving insurer” defined. (a) A domestic mutual insurer shall not merge or consolidate with a stock insurer. (b) A domestic mutual insurer may merge or consolidate with another domestic or foreign mutual insurer under th…

§ 4935. Merger, consolidation of mutual insurers — Approval of merger; consolidation agreement by boards of directors. (a) The board of directors of each of the mutual insurers proposing to merge or consolidate shall, by resolution adopted by at least a majority of all the member…

§ 4936. Merger, consolidation of mutual insurers — Effectuation; disapproval by Commissioner. (a) No such merger or consolidation of a domestic mutual insurer shall be effectuated unless in advance thereof the agreement therefor has been filed with the Commissioner and has not be…

§ 4937. Merger, consolidation of mutual insurers — Approval by members. (a) After the Commissioner has approved the proposed agreement of merger or consolidation and if the insurer is then unimpaired, the agreement shall be submitted to the domestic insurer’s members for approval…

§ 4938. Merger, consolidation of mutual insurers — Impaired mutuals. If a domestic mutual insurer is then impaired, that is, if the insurer’s surplus is less than the amount thereof required under this title for authority to transact the kinds of insurance being transacted by the…

§ 4939. Merger, consolidation of mutual insurers — Articles of merger, consolidation, mutual insurers. Upon the approval by the Commissioner and members, if required, and upon agreement of merger or consolidation, articles of merger or consolidation, as the case may be, shall be …

§ 4940. Merger, consolidation of mutual insurers — Filing of articles of merger or consolidation; payment of fees; approval by Secretary of State. (a) The articles of merger or consolidation, as the case may be, referred to in § 4939 of this title, together with a certificate or …

§ 4941. Merger, consolidation of mutual insurers — Issuance of certificate of merger or consolidation; effective date. (a) Immediately upon the Secretary of State’s approval of the articles of merger or consolidation as provided in § 4940 of this title, the Secretary of State sha…

§ 4942. Merger, consolidation of mutual insurers — Effect of merger or consolidation. (a) Upon the merger or consolidation becoming effective, the several corporations, parties to the agreement of merger or consolidation, shall be a single corporation, which in the case of a merg…

§ 4943. Preservation of old charter in merger or consolidation. (a) In any merger or consolidation of a foreign stock or mutual insurer into or with a domestic insurer under § 4930 of this title, in accordance with this section, the continuing Delaware corporation shall for all p…

§ 4944. Bulk reinsurance. (a) A domestic insurer may reinsure all or substantially all of its business in force, or all or substantially all of a major class thereof, with another insurer, stock or mutual, by an agreement of bulk reinsurance after compliance with this section. No…

§ 4945. Mutual member’s share of assets on liquidation. (a) Upon any liquidation of a domestic mutual insurer, its assets remaining after discharge of its indebtedness, policy obligations, repayment of contributed or borrowed surplus, if any, and expenses of administration shall …

§ 4946. Redomestication; approval as domestic insurer; conversion to foreign insurer; rules and regulations. (a) Any insurer which is organized under the laws of any other state and is admitted to do business in this State for the purpose of writing insurance may become a domesti…

§ 4970. Finding; purpose. (a) It is determined and declared as a matter of legislative finding that policyholders of a mutual insurer have contractual rights to insurance coverage and certain membership rights consisting principally of the right to elect directors of a mutual ins…

§ 4971. Short title of chapter. This chapter shall be known and may be cited as the “Delaware Insurance Company Mutual-to-Stock Conversion Act.”77 Del. Laws, c. 466, § 2;

§ 4972. Definitions. As used in this chapter, the following words and phrases shall have the meanings as ascribed in this section: (1) “Capital stock” means common or preferred stock or any hybrid security or other equity security issued by a converted stock insurer or other comp…

§ 4973. Adoption of plan of conversion. (a) No plan of conversion shall become effective unless the mutual company seeking to convert to a stock company shall have adopted, by the affirmative vote of not less than 2/3 of its governing body and otherwise in accordance with law, a …

§ 4974. Redomestication and conversion. (a) A foreign mutual insurer or foreign mutual holding company that has filed an application for redomestication may file an application for conversion under this chapter promptly after completion of the redomestication or upon such earlier…

§ 4975. Required provisions of plan of conversion. (a) The following provisions shall be included in the plan: (1) The reasons for proposed conversion. (2) The effect of conversion on existing policies, including all of the following: a. A provision that all policies in force on …

§ 4976. Closed block of business for participating life policies. (a) A plan that is adopted by a mutual company that is a life insurance company which issues participating life policies shall provide that participating life policies in force on the effective date of the conversi…

§ 4977. Optional provisions of plan of conversion. (a) The plan may provide that the directors, officers, and employees of the mutual company shall receive, without payment, nontransferable subscription rights to purchase capital stock of the converted stock company or the stock …

§ 4978. Alternative plan of conversion. (a) The governing body may adopt a plan of conversion that does not rely in whole or in part upon issuing nontransferable subscription rights to members to purchase stock of the converted stock company if the Commissioner finds that the pla…

§ 4979. Effective date of plan. A plan is effective when the Commissioner has approved the plan, the voting members have approved the plan and adopted the certificate of incorporation of the converted stock company, and the certificate of incorporation is filed in the office of t…

§ 4980. Rights of members whose policies are issued after adoption of plan and before effective date. (a) All members whose policies are issued after the proposed plan has been adopted by the governing body and before the effective date of the plan shall be sent a written notice …