Title 41, INSURANCE

41-2805. FILING OF ARTICLES. (1) The incorporators shall submit the executed articles of incorporation of a proposed stock or mutual insurer in triplicate to the director for review. If the director finds the articles to be in compliance with this code he shall deliver an origina…

41-2809. INVESTIGATION OF PROPOSED ORGANIZATION. Upon application of a new insurer for a certificate of authority, the director of the department of insurance shall promptly make an investigation of: (1) The character, reputation, financial standing and purposes of the organizers…

41-2818. QUALIFICATION FOR INITIAL CERTIFICATE OF AUTHORITY -- STOCK INSURERS. A newly formed domestic stock insurer shall be entitled to a certificate of authority only when its entire authorized capital stock has been subscribed for and paid for in full, and it has fulfilled th…

41-2820. INITIAL QUALIFICATIONS -- DOMESTIC MUTUALS. When newly organized, a domestic mutual insurer may be authorized to transact any one of the kinds of insurance defined in sections 41-502 through 41-506, Idaho Code, if it has otherwise complied with the provisions of title 41…

41-2822. APPLICATIONS FOR INSURANCE IN FORMATION OF MUTUAL INSURER. (1) Upon receipt of the director's approval of the bond or deposit as provided in section 41-2821, Idaho Code, the proposed domestic mutual insurer may commence solicitation of such requisite applications for ins…

41-2823. FORMATION OF MUTUALS -- TRUST DEPOSIT OF PREMIUMS -- ISSUANCE OF POLICIES. (1) 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 un…

41-2824. FORMATION OF MUTUALS -- FAILURE TO QUALIFY. If the proposed domestic mutual insurer fails to complete its organization and to secure its original certificate of authority within one (1) year from and after date of its certificate of incorporation, the corporation shall t…

41-2825. ADDITIONAL KINDS OF INSURANCE -- MUTUALS. A domestic mutual insurer, after being authorized to transact one (1) kind of insurance, may be authorized to transact such additional kinds of insurance as are permitted under section 41-312, Idaho Code, while otherwise in compl…

41-2826. AMENDMENT OF ARTICLES OF INCORPORATION -- STOCK INSURERS. (1) A domestic stock insurer may amend its articles of incorporation or bylaws for any lawful purpose through procedures prescribed by the statutes of this state as to business corporations in general, and by comp…

41-2827. AMENDMENT OF ARTICLES OF INCORPORATION -- MUTUAL INSURER. (1) A domestic mutual insurer heretofore or hereafter formed may amend its articles of incorporation for any lawful purpose by affirmative vote of a majority of those of its members present or represented by proxy…

41-2828. INSURANCE BUSINESS EXCLUSIVE. A domestic insurer heretofore or hereafter formed shall not have corporate power to engage, and shall not directly or indirectly engage, in any business other than the insurance business and in business activities reasonably and necessarily …

41-2829. MEMBERSHIP IN MUTUALS. (1) 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. (2) Any per…

41-2830. BY-LAWS OF MUTUAL. (1) A domestic mutual insurer shall have by-laws for the government of its affairs. The insurer's initial board of directors shall adopt original by-laws, subject to the approval of the insurer's members at the next meeting of members. (2) The by-laws …

41-2831. RIGHTS OF MUTUAL MEMBERS IN GENERAL. (1) A domestic mutual insurer is owned by and shall be operated in the interest of its members. (2) With respect to the management, records and affairs of the insurer, a member of a mutual insurer shall have the same character of righ…

41-2832. MEETINGS OF MEMBERS OF MUTUAL INSURER. (1) Meetings of members of a domestic mutual insurer shall be held in the city or town of its registered office in this state, except as may otherwise be provided in the insurer's by-laws with the director's approval. (2) Each such …

41-2833. SPECIAL MEETINGS OF MEMBERS OF MUTUAL INSURER. (1) A special meeting of the members of a mutual insurer may be held for any lawful purpose. The meeting shall be called by the corporate secretary pursuant to request of the insurer's president or of its board of directors,…

41-2834. VOTING RIGHTS OF MUTUAL MEMBERS. (1) Each member of a mutual insurer is entitled to one (1) vote upon each matter coming to a vote at meetings of members. (2) A member shall have the right to vote in person or by his written proxy filed with the corporate secretary not l…

41-2835. DIRECTORS. (1) The affairs of every domestic insurer shall be managed by a board of directors consisting of not less than five (5) directors or more than twenty-five (25) directors. (2) Directors shall be elected by the members or stockholders of a domestic insurer at th…

41-2836. NOTICE OF CHANGE OF DIRECTORS OR OFFICERS. An insurer shall promptly give the director written notice of any change of personnel among its directors or principal officers.

41-2837. PROHIBITED PECUNIARY INTEREST OF OFFICIALS. (1) Any officer or director, or any member of any committee or an employee of a domestic insurer who is charged with the duty of investing or handling the insurer's funds shall not deposit or invest such funds except in the ins…

41-2838. MANAGEMENT AND EXCLUSIVE AGENCY CONTRACTS. (1) 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 substantial exclusion of its board of directors or to have the controlling or pr…

41-2839. HOME OFFICE -- RECORDS -- ASSETS -- PENALTY FOR UNLAWFUL REMOVAL. (1) Except as provided in subsection (5) of this section, every domestic insurer shall have and maintain its principal place of business and home office in this state, and shall keep therein accurate and c…

41-2840. VOUCHERS FOR EXPENDITURES. (1) No insurer shall make any disbursement of twenty-five dollars ($25) or more, unless evidenced by a voucher or other document correctly describing the consideration for the payment and supported by a check or receipt endorsed or signed by or…

41-2841. BORROWED SURPLUS. (1) A domestic stock or mutual insurer may borrow money to defray the expenses of its organization, provide it with surplus funds, or for any purpose of its business, upon a written agreement that such money is required to be repaid only out of the insu…

41-2842. PARTICIPATING POLICIES. (1) As provided in its articles of incorporation, a domestic stock insurer or domestic mutual insurer may issue any or all of its policies with or without participation in profits, savings, unabsorbed portions of premiums, or surplus; may classify…

41-2843. DIVIDENDS TO STOCKHOLDERS. A domestic stock insurer shall not pay any dividend to stockholders except out of earned surplus. Prior to payment thereof, the director, in his discretion, may approve the payment of a dividend from other than earned surplus. For purposes of t…

41-2844. DIVIDENDS TO POLICY HOLDERS. (1) The directors of a domestic mutual insurer may from time to time apportion any 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 realize…

41-2845. ILLEGAL DIVIDENDS -- PENALTY. (1) Any director of a domestic stock insurer or domestic mutual insurer who knowingly votes for or concurs in declaration or payment of a dividend to stockholders or policyholders other than as authorized under sections 41-2843 or 41-2844 sh…

41-2846. CONTINGENT LIABILITY OF MUTUAL MEMBERS. (1) Except as provided otherwise in section 41-2849 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 obli…

41-2847. LEVY OF CONTINGENT LIABILITY. (1) 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 code for authority to transact the kinds of insurance being transacted, and…

41-2848. ENFORCEMENT OF CONTINGENT LIABILITY. (1) The insurer shall notify each member of the amount of the assessment to be paid by written notice mailed to the member's address last of record with the insurer. Failure of the member to receive the notice so mailed, within the ti…

41-2849. NONASSESSABLE POLICIES -- MUTUAL INSURERS. (1) A domestic mutual insurer while maintaining unimpaired surplus funds not less in amount than the minimum paid-in capital stock required of a domestic stock insurer formed under this code for authority to transact the same ki…

41-2850. NONASSESSABLE POLICIES -- REVOCATION OF AUTHORITY. (1) The director shall revoke the authority of a domestic mutual insurer to issue policies without contingent liability if (a) At any time the insurer's assets are less than the sum of its liabilities and the surplus req…

41-2851. SOLICITATIONS IN OTHER STATES. (1) No domestic insurer shall knowingly solicit insurance business in any reciprocating state in which it is not then licensed as an authorized insurer. (2) This section shall not prohibit advertising through publications and radio, televis…

41-2852. IMPAIRMENT OF CAPITAL OR ASSETS. (1) If the assets of a domestic insurer are less than its liabilities and the minimum amount of capital funds required to be maintained by it under section 41-313, Idaho Code, for authority to transact the kinds of insurance being transac…

41-2853. ASSESSMENT OF STOCKHOLDERS OR MEMBERS. (1) Any insurer receiving the director's notice required in section 41-2852(1): (a) If a stock insurer and to the extent that stockholders are subject to assessment under the insurer's articles of incorporation, by resolution of its…

41-2854. MUTUALIZATION OF STOCK INSURERS. (1) A stock insurer other than a title insurer may become a mutual insurer under such plan and procedure as may be approved by the director after a hearing thereon. (2) The director shall not approve any such plan, procedure or mutualizat…

41-2854A. MUTUALIZATION OF SERVICE CORPORATIONS. (1) Every corporation organized or existing under chapter 34, title 41, Idaho Code, as a hospital service corporation, a combined professional service and hospital service corporation, or a professional service corporation whose ar…

41-2855. CONVERSION OF MUTUAL INSURER TO STOCK INSURER. (1) A mutual insurer may become a stock insurer under such plan and procedure as may be approved by the director after a hearing thereon. (2) The director shall not approve any conversion plan or procedure unless: (a) It is …

41-2856. MERGERS AND CONSOLIDATIONS OF STOCK INSURERS. (1) A domestic stock insurer may merge or consolidate with one or more domestic or foreign stock insurers, or ordinary business corporations having as their principal assets, cash or assets of a character allowed by investmen…

41-2857. MERGERS AND CONSOLIDATIONS OF MUTUAL INSURERS. (1) Except as set forth in section 41-3824, Idaho Code, a domestic mutual insurer shall not merge or consolidate with a stock insurer. (2) A domestic mutual insurer may merge or consolidate with another mutual insurer under …

41-2858. BULK REINSURANCE -- MUTUAL INSURERS. (1) A domestic mutual 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 compl…

41-2859. MUTUAL MEMBER'S SHARE OF ASSETS ON LIQUIDATION. (1) 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, shal…

41-2860. EQUITY SECURITIES OF DOMESTIC STOCK INSURANCE COMPANIES -- STATEMENTS OF OWNERSHIP. Every person who is directly or indirectly the beneficial owner of more than ten per cent (10%) of any class of any equity security of a domestic stock insurance company, or who is a dire…

41-2861. RECOVERY OF PROFITS RESULTING FROM UNFAIR USE OF INFORMATION. For the purpose of preventing the unfair use of information which may have been obtained by such beneficial owner, director or officer by reason of his relationship to such company, any profit realized by him …

41-2862. RESTRICTIONS ON SALE OF EQUITY SECURITIES. It shall be unlawful for any such beneficial owner, director or officer, directly or indirectly, to sell any equity security of such company if the person selling the security or his principal: (a) does not own the security sold…