Title 38, Insurance

All property insured by said corporation shall be liable as herein provided until all outstanding losses shall have been paid, and until the owner thereof shall have withdrawn his insurance in the manner prescribed by the by-laws of said corporation: Provided, however, That any t…

The aggregate amount of insurance by said corporation shall not be less than ($25,000) twenty-five thousand dollars nor more than ($1,000,000) one million dollars.

A domestic or foreign mutual insurer may reorganize as a domestic mutual insurance holding company system as provided in this article.

(A) A domestic or foreign mutual insurer may reorganize into a domestic mutual insurance holding company system which must consist of a domestic mutual insurance holding company and the reorganized mutual insurer as a domestic stock insurance company and which may consist of one …

(A) A plan of reorganization must be approved by the affirmative vote of not less than a two-thirds majority of the board of directors of the mutual insurer. The plan of reorganization approved by the board of directors shall be filed with the Director of the Department of Insura…

(A) The Director of the Department of Insurance shall review the plan of reorganization for the purpose of determining whether the plan meets the requirements of this article. The director may employ staff personnel and outside consultants. All reasonable costs related to the rev…

(A) After the date of the director's conditioned approval of a plan of reorganization, the mutual insurer shall hold a regular or special meeting of its policyholders at a reasonable time and place to vote upon the plan of reorganization. The mutual insurer shall give at least th…

The reorganized insurer shall file the articles of incorporation of the mutual holding company, the reorganized stock insurer, and any holding company subsidiaries with the Director of the Department of Insurance for his approval before filing them with the Secretary of State. Th…

A membership interest in a mutual insurance holding company does not constitute a security under the laws of the State of South Carolina. A membership interest in a mutual insurance holding company may not be transferred from the member to another person or entity.

A mutual insurance holding company shall not be authorized to pay dividends or make distributions except as may be expressly approved by the Director of the Department of Insurance. Neither the adoption nor the implementation of a plan of reorganization shall be considered to giv…

Nothing contained in this article shall be construed to prohibit demutualization of a mutual insurance holding company or a mutual insurer pursuant to the laws of this State. All provisions of law regarding demutualization of a mutual insurer shall also apply to a mutual insuranc…

All information, documents, and copies that are obtained by or disclosed to the Director of the Department of Insurance or another person in the course of preparing, filing, or processing an application to reorganize, other than information or documents distributed to policyholde…

(A) A mutual insurance holding company, intermediate holding company, and the reorganized stock insurer shall be considered to be insurers according to the laws of this State. However, the director may exempt by order a mutual insurance holding company or intermediate holding com…

In a proceeding for supervision, rehabilitation, or liquidation involving a reorganized mutual insurer, the assets of the mutual insurance holding company and an intermediate stock holding company shall be considered to be assets of the reorganized mutual insurer for the purposes…

(A) A mutual insurance holding company shall file with the Director of the Department of Insurance an annual income statement, balance sheet, and cash flow statement, and a statement regarding any encumbrances or plans to encumber the assets of the mutual insurance holding compan…

A challenge to reorganization or an action involving the reorganization of a mutual insurer shall be commenced no later than one hundred eighty days after the effective date of reorganization.

Each holder of an individual or group annuity contract or an individual or group contract of insurance, other than a contract of reinsurance, is a member of the insurer with the rights and obligations of membership as provided by this chapter. With respect to a group annuity cont…

The directors of a domestic mutual insurer may apportion and pay dividends to its members as entitled thereto, but only out of that part of its surplus funds which is in excess of its required minimum surplus and which represents net realized savings and net realized earnings fro…

(A) Except as otherwise provided by law, every domestic mutual insurer must be organized, governed, and operated as a domestic business corporation under and in accordance with the South Carolina Business Corporation Act of 1988, (the "Business Corporation Act"). Without limiting…

Notice of the time and place of the annual meeting of members of a domestic mutual insurer must be given by imprinting the notice plainly on the policies issued by the insurer. Any change of the time or place of the annual meeting may be made only at an annual meeting of members.…

Each member of a domestic mutual insurer, except as otherwise provided in this chapter, has a contingent liability, prorata and not one for another, for the discharge of its obligations. The contingent liability is, at a maximum, the amount stated in the insurer's articles of inc…

The contingent liability of members of a domestic mutual insurer to assessment does not constitute an asset of the insurer in the determination of its financial condition.

No person may insure against or agree or promise any member of a domestic mutual insurer holding a policy which provides for contingent liability to save him harmless from the contingent liability or any assessment under the policy. Any insurance, agreement, or promise attempted …

If at any time the surplus of a domestic mutual insurer is less than the amount required by this title and the deficiency is not cured from other sources, its directors may with the approval of the director or his designee make an assessment on its members who, at any time within…

A member's proportionate part of any deficiency is computed by applying to the premium earned within the twelve-month period on his contingently liable policy or policies the ratio of the total deficiency to the total premium earned during the period on all contingently liable po…

The contingent liability of members of a domestic mutual insurer doing business on the assessment premium plan must be called upon and enforced by its directors as provided in its bylaws.

A domestic mutual insurer, after it has established a surplus not less than the minimum capital and surplus required of a stock insurer to transact like kinds of insurance and for so long as it maintains this surplus, may extinguish the contingent liability of its members to asse…

The director or his designee may not authorize a domestic mutual insurer to extinguish the contingent liability of any of its members or in any of its policies to be issued unless it qualifies to and does extinguish the liability of all its members and in all policies for all kin…

The director or his designee shall revoke the authority of a domestic mutual insurer to extinguish the contingent liability of its members if: (1) at any time the insurer's surplus is less than the minimum capital and surplus required of a stock insurer to transact similar kinds …

(A) A member of a domestic mutual insurer may vote in person or by proxy on any matter coming before a corporate meeting of members. An appointment of proxy is effective when received by the secretary or other officer or agent authorized to tabulate votes. Unless a time of expira…

At any annual meeting of a domestic mutual insurer all business including the election of directors must be conducted pursuant to majority vote of those members present and voting either in person or by proxy of nonpresent members as provided in Section 38-19-50. No other quorum …

A domestic mutual insurer, with the advance approval of the director or his designee and without the pledge of any of its assets, may borrow money to defray the expenses of its organization or for any purpose required by its business upon an agreement that the money and the inter…

Any money so borrowed may not form a part of the insurer's legal liabilities or be the basis of any setoff but, until it is repaid, financial statements filed or published by the insurer shall show as a footnote the amount of the loan then unpaid together with interest accrued bu…

The insurer may repay the loan only out of its realized net earned surplus in excess of the minimum surplus required for the kinds of insurance transacted. This loan may not be repaid out of borrowed money. The insurer shall repay the loan or a part of it when its realized net ea…

If there is more than one such loan or if any such loan is represented by multiple agreements, the loan agreement shall provide, in addition to any other time of repayment specified in it, that any part of the loan may be repaid at any time by selection by lot, under supervision …

No repayment of the loan may be made unless approved by the director or his designee. The insurer shall notify the director or his designee in writing not less than sixty days in advance of its intention to repay the loan or any part of it. The director or his designee shall imme…

Upon dissolution and liquidation of the insurer the holders of such loan agreements remaining unpaid after the retirement of all the insurer's other outstanding obligations are entitled to payment before any distribution may be made to the insurer's members.

For the purposes of this article: (1) "Bulk reinsurance and assumption for the purposes of liquidation" means a transaction in which a mutual insurer wholly reinsures its business with another insurer, transfers all or part of its assets to the other insurer in exchange for an as…

(A) A mutual insurer may engage in any of the transactions specified in Section 38-19-815 under such reasonable plan and procedure as approved by the director or his designee after a public hearing on the matter. Notice must be given to those persons who were members, directors o…