181 
(B) occurs within a reasonable timeframe 
that advances the purposes of this section; 
(C) is made in close consultation and co-
operation with the Commissioner; 
(D) is without bias or discrimination to-
ward either the transferring insurer or the as-
suming insurer; 
(E) serves a legitimate State interest; and 
(F) does not frustrate the proposed bulk 
transfer. 
(4) NOTICE OF FAILURE.—If the Commissioner 
finds that any State review or action under para-
graph (2)(A) fails to meet any of the standards set 
forth in paragraph (3), the Commissioner may pro-
vide the applicable State with notice of such failure 
and the reasons for such failure. 
(g) DIFFERENTIAL TREATMENT PROHIBITED.—A 
State may not treat a National Insurer, a permitted Na-
tional Insurer, or a State insurer entering into a bulk 
transfer agreement with a National Insurer, a permitted 
National Insurer, a State insurer, or any affiliate or sub-
sidiary of such insurer, differently than any other insurer 
operating in that State. 
(h) NO DELEGATION PERMITTED.—The Commis-
sioner may not delegate to any insurance self-regulatory 
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182 
organization any authority conferred under this section 
with respect to any bulk transfer involving a National In-
surer. 
SEC. 234. DOMESTICATION OF UNITED STATES BRANCH OF 
A NON-UNITED STATES INSURER. 
(a) DOMESTICATION PERMITTED.—Any non-United 
States insurer having its United States branch entered 
through a State or established pursuant to section 202 
and owning beneficially, directly or indirectly, all out-
standing shares of a National Insurer may, upon the writ-
ten approval by the Commissioner, domesticate its United 
States branch by agreeing in writing with such National 
Insurer to the acquisition of the business and assets, and 
the assumption of all liabilities, of the United States 
branch, by the National Insurer for no consideration ex-
cept such assumption. 
(b) APPROVAL BY COMMISSIONER.—If the Commis-
sioner determines that the domestication of a United 
States branch of a non-United States insurer complies 
with the provisions of this section and that the interests 
of policyholders and creditors of the United States branch 
are not materially affected in an adverse manner by such 
domestication, the Commissioner may approve the domes-
tication in accordance with this section. 
(c) EFFECTIVE DATE OF DOMESTICATION.— 
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183 
(1) IN
GENERAL.—The domestication of the 
United States branch shall be effective on the date 
on which a certified copy of the instrument of trans-
fer and assumption is filed with the Commissioner. 
(2) EFFECT OF DOMESTICATION.—On the date 
described in paragraph (1)— 
(A) all rights, franchises, and interests of 
such United States branch in and to every spe-
cies of property, real, personal, and mixed, and 
things in action belonging to such branch, shall 
be deemed transferred to and vested in the ac-
quiring National Insurer; 
(B) the acquiring National Insurer shall be 
deemed to have assumed all liabilities of the 
United States branch; 
(C) all deposits of the United States 
branch held by State officers or other State 
regulatory agencies under State law shall be re-
leased; and 
(D) the non-United States insurer and the 
United States branch shall be released from all 
liabilities so assumed. 
(d) RELEASE OF DEPOSITS.—At the time of the do-
mestication of a United States branch under this section, 
the Commissioner shall— 
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184 
(1) transfer to the account of the acquiring Na-
tional Insurer the securities deposited by such 
United States branch in compliance with the provi-
sions of this Act; and 
(2) consent that the trustee of the trusteed as-
sets deposited by such United States branch in com-
pliance with the provisions of this Act shall with-
draw from the trust and transfer and deliver to the 
acquiring National Insurer all assets held by such 
trustee. 
(e) WITHDRAWAL AND TRANSFER OF TRUSTEED AS-
SETS.— 
(1) IN GENERAL.—At the time of the domes-
tication of a United States branch established under 
State law, the trustee of any trusteed assets depos-
ited by such United States branch in compliance 
with applicable State law shall, with the consent of 
the Commissioner— 
(A) withdraw the trusteed assets from the 
trust; and 
(B) transfer and deliver to the acquiring 
National Insurer all assets held by such trustee. 
(2) LIMITATION.—No State may prevent, sig-
nificantly interfere with, review, approve, or dis-
approve the withdrawal of trusteed assets or other 
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185 
deposits of a United States branch established under 
State law that is domesticating pursuant to this sec-
tion, if such withdrawal is made contemporaneously 
with or subsequent to the consummation of a domes-
tication of the United States branch under this sec-
tion. 
(f) NO DELEGATION PERMITTED.—The Commis-
sioner may not delegate to any insurance self-regulatory 
organization any authority under this section with respect 
to the domestication of a United States branch of a non- 
United States insurer. 
SEC. 235. MERGERS, CONSOLIDATIONS, AND ACQUISITIONS 
OF NATIONAL AGENCIES. 
(a) NATIONAL AGENCY RESULTING.— 
(1) IN GENERAL.—Notwithstanding any other 
provision of law, a National Agency may, with the 
approval of the Commissioner, merge, consolidate 
with, acquire all or substantially all the assets of, or 
assume all or substantially all the liabilities of, an-
other National Agency or a State insurance agency 
in a transaction in which a National Agency is the 
resulting agency, the acquiring agency, or the as-
suming agency. 
(2) MERGER, CONSOLIDATION, AND
ACQUISI-
TION PROCEDURES.—The Commissioner is author-
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186 
ized, under such regulations as the Commissioner 
may prescribe, to provide for— 
(A) the merger or consolidation of a Na-
tional Agency with another National Agency or 
a State insurance agency in a transaction in 
which a National Agency is the resulting agen-
cy; and 
(B) the acquisition or assumption by a Na-
tional Agency of all or substantially all the as-
sets or all or substantially all the liabilities of 
another National Agency or a State insurance 
agency in a transaction in which the National 
Agency is the acquiring or assuming agency. 
(3) EFFECT OF MERGER OR CONSOLIDATION.— 
Upon the merger or consolidation of a National 
Agency with another National Agency or a State in-
surance agency under this section— 
(A) the corporate existence of each of the 
merging or consolidating agencies shall be 
merged or consolidated into the resulting agen-
cy, and the resulting agency shall be deemed to 
be the same corporation as each agency partici-
pating in the merger or consolidation; and 
(B) except as provided under paragraph 
(4), the resulting agency shall have all the 
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187 
rights, privileges, liabilities, property interests, 
and other interests and obligations that each 
agency participating in the merger or consolida-
tion had immediately before the merger or con-
solidation. 
(4) LIMITATION.—Upon a merger or consolida-
tion under this subsection, the resulting agency— 
(A) shall not hold any State license to sell, 
solicit, or negotiate insurance that was held by 
a State agency participating in the merger or 
consolidation; and 
(B) shall obtain, in accordance with section 
301, appropriate licenses for all lines of insur-
ance that it sells, solicits, or negotiates except 
for those lines of insurance for which a Na-
tional Agency participating in the merger or 
consolidation held a Federal producer’s license 
immediately before the merger or consolidation. 
(5) SPECIAL
AUTHORITY.—The Commissioner 
may, subject to such regulations as the Commis-
sioner may prescribe, permit a National Agency re-
sulting from a merger or consolidation under this 
subsection to retain, hold, or exercise such assets, li-
abilities, powers, and authorities that do not con-
form to the legal requirements applicable to National 
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188 
Agencies as the Commissioner determines to be ap-
propriate. 
(b) STATE INSURANCE AGENCY RESULTING.— 
(1) IN GENERAL.—Subject to such notification 
procedures as the Commissioner may prescribe by 
regulation, a State insurance agency may merge, 
consolidate with, acquire assets of, or assume liabil-
ities of, a National Agency in a transaction in which 
a State insurance agency is the resulting agency, in 
accordance with applicable State law. 
(2) SAVINGS PROVISION.—Nothing in this sub-
section or in a transaction pursuant to this sub-
section shall abrogate any rights, privileges, liabil-
ities, property interests, other interests, or obliga-
tions that the National Agency had immediately be-
fore the transaction. 
(c) EFFECT OF ASSUMPTION OF LIABILITIES.—If the 
liabilities of a National Agency are assumed by another 
National Agency or a State insurance agency in accord-
ance with the provisions of this Act, such National Agency 
from whom the liabilities are assumed shall be released 
from all liabilities so assumed upon their assumption by 
the other National Agency or a State insurance agency. 
(d) NO DELEGATION PERMITTED.—The Commis-
sioner may not delegate to any insurance self-regulatory 
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189 
organization any authority conferred under this section 
with respect to any merger, consolidation, or acquisition 
of assets or assumption of liabilities involving a National 
Agency. 
Subtitle E—Conversions 
SEC. 241. DEFINITIONS. 
In this subtitle: 
(1) ADOPTION
DATE.—The term ‘‘adoption 
date’’ means the date on which the board of direc-
tors of the converting mutual insurer or converting 
stock insurer adopts the plan of conversion. 
(2) CONVERTED MUTUAL INSURER.—The term 
‘‘converted mutual insurer’’ means the National Life 
Insurer in mutual form into which a stock life in-
surer has been converted in accordance with the pro-
visions of section 242. 
(3) CONVERTED
STOCK
INSURER.—The term 
‘‘converted stock insurer’’ means the National In-
surer in stock form into which a mutual insurer has 
been converted in accordance with the provisions of 
section 243. 
(4) CONVERTING MUTUAL INSURER.—The term 
‘‘converting mutual insurer’’ means the mutual in-
surer that is converting under a plan of conversion 
under section 243. 
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190 
(5) CONVERTING STOCK INSURER.—The term 
‘‘converting stock insurer’’ means the stock life in-
surer that is converting under a plan of conversion 
under section 242. 
(6) 
MEMBERSHIP
INTERESTS.—The 
term 
‘‘membership interests’’— 
(A) means the interests of members and 
policyholders of the mutual insurer arising 
under the charter and bylaws of the mutual in-
surer or otherwise by applicable law; 
(B) includes the right to vote for directors 
of the mutual insurer and the right to vote on 
any plan of merger or consolidation of the mu-
tual insurer; and 
(C) does not include rights in surplus, if 
any. 
(7) MUTUAL INSURER.—The term ‘‘mutual in-
surer’’ means the State insurer in mutual form or 
National Insurer in mutual form that is converting 
to a National Insurer in stock form pursuant to a 
plan of conversion adopted in accordance with sec-
tion 243. 
(8) PLAN
OF
CONVERSION
OR
PLAN.—The 
terms ‘‘plan of conversion’’ and ‘‘plan’’ mean a plan 
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191 
of conversion adopted by a stock life insurer or a 
mutual insurer in accordance with this subtitle. 
(9) RIGHTS IN SURPLUS.—The term ‘‘rights in 
surplus’’— 
(A) means rights, if any, of members or 
policyholders of the mutual insurer to a return 
of that portion of the surplus that has not been 
apportioned or declared by the board of direc-
tors for policyholder dividends; 
(B) includes rights of members or policy-
holders of the mutual insurer to a distribution 
of surplus in liquidation or conservation of the 
insurer under applicable law, or in a dissolution 
or winding up; and 
(C) does not include any right expressly 
conferred solely by the terms of an insurance 
policy. 
(10) STOCK LIFE INSURER.—The term ‘‘stock 
life insurer’’ means the State life insurer in stock 
form or National Life Insurer in stock form that is 
converting to a National Life Insurer in mutual 
form pursuant to a plan of conversion adopted in ac-
cordance with section 242. 
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192 
SEC. 242. CONVERSION OF STOCK LIFE INSURER TO NA-
TIONAL LIFE INSURER IN MUTUAL FORM. 
(a) AUTHORITY TO CONVERT.—Notwithstanding any 
other provision of law, a stock life insurer may convert 
to a National Insurer in mutual form by complying with 
the requirements of this section and such regulations as 
the Commissioner may promulgate pursuant to this Act. 
(b) PLAN OF CONVERSION.— 
(1) IN GENERAL.—The plan of conversion— 
(A) shall be adopted by the board of direc-
tors of the converting stock insurer; and 
(B) shall provide for the conversion of the 
converting stock insurer into a National Life 
Insurer in mutual form. 
(2) ISSUANCE
OF
STOCK
AFTER
ADOPTION 
DATE.—No additional shares of capital stock shall 
be issued after the adoption date, except that— 
(A) stock options to purchase capital stock 
may continue to be issued under existing con-
tracts; and 
(B) outstanding options may continue to 
be exercised until the effective date of the plan 
of conversion. 
(3) CONTENTS.—The plan of conversion shall 
provide for— 
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193 
(A) the purchase by the converting stock 
insurer of all of its outstanding capital stock, at 
a price either specified in the plan or to be de-
termined under a formula specified in the plan, 
for cash or other consideration as set forth in 
the plan; and 
(B) the termination, upon terms specified 
in the plan, of any contractual obligation incon-
sistent with the nature of a mutual insurer, in-
cluding any obligation to issue stock options or 
issue capital stock upon exercise of options. 
(c) APPROVAL OF PLAN BY COMMISSIONER.—The 
Commissioner shall approve the plan of conversion if the 
Commissioner finds, after a hearing, that— 
(1) the plan is fair and equitable to the policy-
holders, shareholders, and holders of options to ac-
quire capital stock of the converting stock insurer; 
(2) the plan does not violate the law; and 
(3) the converted mutual insurer will, after the 
conversion, satisfy the requirements for the issuance 
of a license to write the lines of insurance for which 
it is licensed. 
(d) VOTE ON APPROVAL OF PLAN.— 
(1) STOCKHOLDERS.—The plan of conversion 
shall be submitted to the holders of record on the 
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194 
adoption date of the converting stock insurer’s 
shares entitled to vote thereon and shall be subject 
to approval of the holders of a majority of such 
shares. 
(2) POLICYHOLDERS.— 
(A) SUBMISSION.—The plan shall be sub-
mitted to policyholders of the converting stock 
insurer— 
(i) who are insured for at least 
$1,000; and 
(ii) whose policy of insurance is in 
force— 
(I) for a period of at least 1 year 
before the adoption date; 
(II) on the adoption date; and 
(III) on the date of the meeting 
of policyholders called for the purpose 
of approving the plan. 
(B) APPROVAL.—The plan shall be subject 
to the approval of a majority of the votes cast 
by the policyholders described in subparagraph 
(A). 
(e) EFFECT OF CONVERSION ON CONVERTED MU-
TUAL INSURERS.— 
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195 
(1) IN GENERAL.—On the effective date of the 
plan of conversion, the stock insurer shall become a 
National Life Insurer in mutual form and share-
holders eligible to receive consideration under the 
plan of conversion are entitled to receive the consid-
eration specified in the plan in exchange for their 
shares of capital stock of the converting stock in-
surer. 
(2) NO EFFECT ON EXISTING RIGHTS AND LI-
ABILITIES.—The converted mutual insurer is a con-
tinuation of the original stock life insurer, and the 
conversion shall not annul, modify, or change any of 
the original stock life insurer’s existing suits, rights, 
contracts, or liabilities, except as provided in the 
plan of conversion. 
(3) RIGHTS
AFTER
CONVERSION.—After con-
version, the converted mutual insurer shall— 
(A) exercise all the rights and powers and 
perform all the duties conferred or imposed by 
law upon insurers writing the classes of insur-
ance written by the converted mutual insurer; 
and 
(B) retain the rights and contracts existing 
prior to conversion, subject to the effect of the 
plan. 
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196 
(f) TIME LIMITS FOR PLAN ACTIONS.— 
(1) IN GENERAL.—Notwithstanding any other 
provision of law, actions concerning any plan of con-
version or proposed plan of conversion under this 
section or any acts taken or proposed to be taken 
under this section shall be commenced not later than 
30 days after the date on which the plan of conver-
sion is approved by the Commissioner under sub-
section (c). 
(2) PLAN WITHDRAWN.—If the plan of conver-
sion is withdrawn, the actions described in para-
graph (1) shall be commenced not later than 30 
days after the date on which the board of directors 
approves a resolution to withdraw the plan. 
(g) EFFECT ON STATE LAW.—No State may prevent 
or interfere with a conversion under this section or impede 
the activities of, take any action against, or apply any pro-
vision of law or regulation to, any such stock life insurer 
because the stock life insurer plans to convert, or has con-
verted, to a National Life Insurer in mutual form under 
this section. 
(h) NO DELEGATION PERMITTED.—The Commis-
sioner may not delegate to any insurance self-regulatory 
organization any authority under this section with respect 
to the conversion of a stock life insurer. 
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197 
SEC. 243. CONVERSION OF MUTUAL INSURER TO NATIONAL 
INSURER IN STOCK FORM. 
(a) AUTHORITY TO CONVERT.—Notwithstanding any 
other provision of law, a mutual insurer may convert to 
a National Insurer in stock form by complying with the 
requirements of this section and such regulations as the 
Commissioner may promulgate pursuant to this Act. 
(b) PLAN OF CONVERSION.— 
(1) IN GENERAL.—The plan of conversion— 
(A) shall be adopted by the board of direc-
tors of the converting mutual insurer; 
(B) shall provide for the conversion of the 
converting mutual insurer into a National In-
surer in stock form; and 
(C) may provide for effecting the conver-
sion by merger of the mutual insurer with an-
other company. 
(2) CONTENTS.—The plan of conversion shall 
provide that— 
(A) all membership interests and rights in 
surplus are extinguished; 
(B) each eligible person will receive, with-
out payment by the person, consideration that 
is allocated among the eligible persons using a 
fair and equitable formula; and 
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198 
(C) eligible persons may receive 1 or more 
kinds of consideration, including— 
(i) cash; 
(ii) shares of capital stock of the con-
verting mutual insurer; 
(iii) shares of capital stock (or inter-
ests in shares of capital stock) of a cor-
poration that, after the conversion, directly 
or indirectly, controls the converted stock 
insurer; 
(iv) premium credits; 
(v) enhanced insurance benefits; or 
(vi) in the case of a converting mutual 
insurer that is a life insurer, credits to in-
surance policy account values, as set forth 
in the plan. 
(c) APPROVAL OF PLAN BY COMMISSIONER.—The 
Commissioner shall approve the plan of conversion if the 
Commissioner finds, after a hearing, that— 
(1) the plan is fair and equitable to the insurer 
and its policyholders; 
(2) the plan does not violate the law; and 
(3) the converted stock insurer will, after the 
conversion, satisfy the requirements for the issuance 
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