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2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.171 - Formation of mutual insurer; bond.

628.171 Formation of mutual insurer; bond.—The incorporators of the proposed insurer shall file with the office a copy of a fidelity bond or insurance policy providing coverage in an amount equal to not less than 10 percent of the funds handled annually and issued in the name of the insurer covering its directors, employees, administrator, or other individuals managing or handling the funds or assets of the insurer. In no case may such bond or policy be less than $1,000 or more than $500,000.
History.—s. 637, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 647, 665, 809(1st), ch. 82-243; ss. 70, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1266, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.221 - Bylaws of mutual insurer.

628.221 Bylaws of mutual insurer.—
(1) The initial board of directors of a domestic mutual insurer shall adopt original bylaws, subject to the approval of the insurer’s members at the next succeeding meeting. The members shall have power to make, modify, and revoke bylaws.
(2) The bylaws shall provide:
(a) That each member is entitled to one vote upon each matter coming to a vote at meetings of members, or to more votes in accordance with a reasonable classification of members as set forth in the bylaws and based upon the amount of insurance in force, or upon the amount of the premiums paid by such member, or upon other reasonable factors. A member shall have the right to vote in person or by his or her written proxy. No such proxy shall be made irrevocable or for longer than a reasonable period of time;
(b) For the election of directors by the members and the number, qualifications, terms of office, and powers of the directors;
(c) The time, notice, quorum, and conduct of annual and special meetings of members and voting thereat. The bylaws may provide that the annual meeting shall be held at a place, date, and time to be set forth in the policy and without giving other notice of such meeting;
(d) The number, designation, election, terms, and powers and duties of the respective corporate officer;
(e) For deposit, custody, and disbursement of and accounting for corporate funds;
(f) That a quorum at all annual and special meetings of members will consist of all members present and voting in person or by proxy, after due notice of such meeting;
(g) For any other reasonable provisions customary, necessary, or convenient for the management or regulation of its corporate affairs and not inconsistent with law.
(3) The insurer shall promptly file with the office a copy, certified by the insurer’s secretary, of its bylaws and of every modification thereof or addition thereto. The office shall disapprove any bylaw provision deemed by it to be unlawful, unreasonable, inadequate, unfair, or detrimental to the proper interests or protection of the insurer’s members or any class thereof. The insurer shall not, after receiving written notice of such disapproval and during the existence thereof, effectuate any bylaw provision so disapproved.
History.—s. 642, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 650, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 381, ch. 97-102; s. 1267, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.231 - Directors.

628.231 Directors.—
(1) The affairs of every domestic insurer shall be managed by not less than five directors.
(2) Directors must be elected by the members or stockholders of a domestic insurer at the annual meeting of stockholders or members. Directors may be elected for terms of not more than 3 years each and until their successors are elected and have qualified; and, if to be elected for terms of more than 1 year, the insurer’s bylaws shall provide for a staggered-terms system under which the terms of a proportionate part of the members of the board of directors will expire on the date of each annual meeting of stockholders or members.
(3) A majority of the directors must be citizens of the United States.
(4) If so provided in a stock insurer’s bylaws, a director of such stock insurer shall be a stockholder thereof; and, if so provided in a mutual insurer’s bylaws, a director of such mutual insurer shall be a policyholder thereof.
(5) In discharging his or her duties, a director may consider such factors as the directors deem relevant, including, but not limited to, the long-term prospects and interests of the corporation and its shareholders, the social, economic, legal, or other effects of any action on the employees, suppliers, or policyholders of the corporation or its subsidiaries, the communities and society in which the corporation or its subsidiaries operate, and the economy of the state and the nation. The director may also consider the short-term and long-term interests of the insurer, including, but not limited to, benefits that may accrue to the insured from the insurer’s long-term plans, the possibility that such interests may be best served by the continued independence of the insurer, the resources, intent, and past, present, and potential conduct of any person seeking to acquire control of the insurer, and any other relevant factors.
History.—s. 643, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 651, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 2, ch. 2000-273.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.251 - Management and exclusive agency contracts.

628.251 Management and exclusive agency contracts.—
(1) No domestic mutual insurer or stock insurer shall 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 preemptive right to produce substantially all insurance business for the insurer, unless the contract is filed with and approved by the office.
(2) Any such contract shall provide that any such manager or producer of its business shall within 90 days after expiration of each calendar year furnish the insurer’s board of directors a written statement of amounts received under or on account of the contract and amounts expended thereunder during such calendar year, including the emoluments received therefrom by the respective directors, officers, and other principal management personnel of the manager or producer, and with such classification of items and further detail as the insurer’s board of directors may reasonably require.
(3) The office shall disapprove any such contract if it finds that it:
(a) Subjects the insurer to excessive charges;
(b) Is to extend for an unreasonable length of time;
(c) Does not contain fair and adequate standards of performance; or
(d) Contains other inequitable provision or provisions which impair the proper interests of policyholders or members of the insurer.
History.—s. 645, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 2, 3, ch. 81-318; ss. 653, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1268, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.255 - Person with effective control cannot receive commission unless contract approved; penalties.

628.255 Person with effective control cannot receive commission unless contract approved; penalties.—
(1) No director, officer, or other person having effective control of a domestic insurer shall receive, and no such insurer shall pay to such person, a commission or other compensation with respect to particular risks insured by the insurer, unless such commission or other compensation is paid pursuant to a contract filed with and approved by the office.
(2) This section shall not be deemed to require approval of the contract or to prohibit payment of commissions to such an officer or director with respect to business written by him or her as an agent of the insurer prior to becoming such an officer or director and vested under the agency contract which was in force at the time such business was originally written.
(3) For the purposes of this section, “effective control” means ownership of 10 percent or more of company stock or receipt of $25,000 or more cumulatively in compensation in 1 calendar year other than commissions resulting from insurance business produced by an agent.
(4) Violation of this section shall subject the insurer to loss of its certificate of authority as provided in s. 624.418 and the agent to loss of his or her license as provided in s. 626.621. Willful violation of this section shall, in addition to the above prescribed penalties, constitute a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
History.—s. 1, ch. 70-319; s. 651, ch. 71-136; s. 162, ch. 71-355; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 654, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 382, ch. 97-102; s. 91, ch. 2003-1; s. 1269, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.261 - Notice of change of director or officer.

628.261 Notice of change of director or officer.—An insurer shall give the office written notice of any change of personnel among the directors or principal officers of the insurer within 45 days of such change. The written notice shall include all information necessary to allow the office to determine that the insurer will be in compliance with s. 624.404(3) and at a minimum shall contain the information required by s. 628.051(2)(b), (c), and (d).
History.—s. 646, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 655, 665, 809(1st), ch. 82-243; s. 3, ch. 86-140; ss. 184, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1270, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.271 - Office and records; penalty for unlawful removal of records.

628.271 Office and records; penalty for unlawful removal of records.—
(1) Every domestic insurer shall have an office in this state and shall keep therein complete records of its assets, transactions, and affairs, specifically including:
(a) Financial records;
(b) Corporate records;
(c) Reinsurance documents;
(d) Access to all accounting transactions and access in this state, upon demand by the office, to all original accounting documents;
(e) Claim files; and
(f) Payment of claims,
in accordance with such methods and systems as are customary or suitable as to the kind or kinds of insurance transacted.
(2) Every domestic insurer shall have and maintain its assets in this state, except as to:
(a) Real property and personal property appurtenant thereto lawfully owned by the insurer and located outside this state, and
(b) Such property of the insurer as may be customary, necessary, and convenient to enable and facilitate the operation of its branch offices, regional home offices, and operations offices, located outside this state as referred to in s. 628.281.
(3) The removal of all or a material part of the records or assets of a domestic insurer from this state except pursuant to a plan of merger or consolidation approved by the office under this code or for such reasonable purposes and periods of time as may be approved by the office in writing in advance of such removal, or the concealment of such records or assets or material part thereof from the office, is prohibited. Any person who removes or attempts to remove such records or assets or such material part thereof from the home office or other place of business or of safekeeping of the insurer in this state with the intent to remove the same from this state, or who conceals or attempts to conceal the same from the office, in violation of this subsection, is guilty of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084. Upon any removal or attempted removal of such records or assets or upon retention of such records or assets or material part thereof outside this state, beyond the period therefor specified in the consent of the office under which consent the records were so removed thereat, or upon concealment of or attempt to conceal records or assets in violation of this section, the office may institute delinquency proceedings against the insurer pursuant to the provisions of chapter 631.
(4) This section is subject to the exceptions provided for in s. 628.281.
History.—s. 647, ch. 59-205; ss. 13, 35, ch. 69-106; s. 652, ch. 71-136; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 656, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1271, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.291 - Unauthorized transactions in other states.

628.291 Unauthorized transactions in other states.—
(1) No domestic insurer shall enter into a contract of insurance upon the life or person of a resident of a reciprocal state or covering property or risks located in a reciprocal state, unless the insurer is authorized pursuant to the laws of such reciprocal state to do business therein, subject to the following exceptions:
(a) Contracts entered into when the prospective insured is personally present and signs the application in the state in which the insurer is authorized to do business;
(b) Issuance of certificates under any lawfully transacted group life or group health policy if the master policy is entered into in a state in which the insurer is authorized to do business;
(c) Contracts made pursuant to a pension or retirement plan of an employer when such contracts are applied for in a state where the employer is personally present or doing business and the insurer is authorized to do business; and
(d) The renewal, reinstatement, conversion, or continuance in force with or without modification of contracts otherwise lawfully entered into and which were not originally entered into in violation of this section.
(2) The term “reciprocal state” as used in this section means a state the laws of which prohibit an insurer organized under the laws of that state from insuring the lives or property of persons resident or located in this state, unless such insurer is authorized pursuant to the laws of this state to do business in this state.
History.—s. 649, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 658, 665, 809(1st), ch. 82-243; s. 5, ch. 90-248; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.301 - Membership in mutual insurer.

628.301 Membership in mutual insurer.—
(1) Each policyholder of a domestic mutual insurer, other than of a reinsurance contract, is a member of the insurer with all rights and obligations of such membership; and the policy shall so specify. Group certificateholders may also be members of the insurer if so specified in the bylaws.
(2) Any person, public or private corporation, board, association, firm, estate, trustee, or fiduciary may be a member of a domestic mutual insurer. Any officer, stockholder, trustee, or legal representative of any such corporation, board, association, or estate may be recognized as acting for or on its behalf for the purpose of such membership and shall not be personally liable upon any contract of insurance for acting in such representative capacity. A mutual insurer may issue policies of insurance covering property of this state, or of any county or municipality of this state, without contingent liability, when such policy contains a provision that the state or any such county or municipality insured under it may not participate in the profits of such insurer.
History.—s. 650, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 659, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.341 - Nonassessable policies; mutual insurers.

628.341 Nonassessable policies; mutual insurers.—
(1) While possessing surplus funds in amount not less than the paid-in capital stock required of a domestic stock insurer transacting like kinds of insurance, a domestic mutual insurer may, upon receipt of the order of the office so authorizing, extinguish the contingent liability of its members as to all its policies in force and may omit provisions imposing contingent liability in all its policies currently issued so long as such surplus funds meet such requirement as to amount.
(2) A foreign or alien mutual insurer may issue nonassessable policies to its members in this state pursuant to its articles of incorporation and the laws of its domicile.
History.—s. 654, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1273, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.351 - Nonassessable policies; revocation of authority of mutual insurer.

628.351 Nonassessable policies; revocation of authority of mutual insurer.—The office shall revoke the authority of a domestic mutual insurer to issue policies without contingent liability if at any time the insurer’s assets are less than the sum of its liabilities and the surplus required for such authority, or if the insurer, by resolution of its board of directors approved by a majority of its members, requests that the authority be revoked. During the absence of such authority, the insurer shall not issue any policy without providing therein for the contingent liability of the policyholder, nor renew any policy which is renewable at the option of the insurer without endorsing the same to provide for such contingent liability. Such renewal or endorsement shall bear conspicuously on its face the provision for contingent liability of the policyholder.
History.—s. 655, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1274, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.361 - Participating policies.

628.361 Participating policies.—
(1) If provided in its certificate of incorporation, a domestic stock or domestic mutual insurer may issue any or all of its policies with or without participation in profits, savings, or unabsorbed portions of premiums, may classify policies issued on a participating and nonparticipating basis, and may determine the right to participate and the extent of participation of any class or classes of policies. Any such classification or determination shall be reasonable and shall not unfairly discriminate as between policyholders within the same such classification. A life insurer may issue both participating and nonparticipating policies only if the right or absence of right to participate is reasonably related to the premium charged.
(2) No dividend, otherwise earned, shall be made contingent upon the payment of renewal premium on any policy.
History.—s. 656, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.381 - Dividends to mutual policyholders.

628.381 Dividends to mutual policyholders.—
(1) 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 and net realized earnings in excess of the surplus required by law to be maintained.
(2) A dividend otherwise proper may be payable out of such savings and earnings even though the insurer’s total surplus is then less than the aggregate of its contributed surplus.
History.—s. 658, ch. 59-205; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.391 - Illegal dividends; penalty.

628.391 Illegal dividends; penalty.—
(1) Any director of a domestic stock or mutual insurer who knowingly votes for or concurs in declaration or payment of a dividend to stockholders or members other than as authorized under s. 628.371 or s. 628.381 is guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083, and shall be jointly and severally liable, together with other such directors likewise voting for or concurring, for any loss thereby sustained by creditors of the insurer to the extent of such dividend.
(2) Any stockholder receiving such an illegal dividend shall be liable in the amount thereof to the insurer.
(3) The office may revoke or suspend the certificate of authority of an insurer which has declared or paid such an illegal dividend.
History.—s. 659, ch. 59-205; ss. 13, 35, ch. 69-106; s. 653, ch. 71-136; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1276, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.401 - Borrowed surplus.

628.401 Borrowed surplus.—
(1) A domestic stock or mutual insurer may borrow money to defray the expenses of its organization, to provide itself 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 insurer’s surplus in excess of that stipulated in such agreement. Any interest provided for shall or shall not constitute a liability of the insurer as to its funds other than such excess of surplus, as stipulated in the agreement. No commission or promotion expense shall be paid in connection with any such loan.
(2) Money so borrowed, together with the interest thereon if so stipulated in the agreement, shall not form a part of the insurer’s legal liabilities, except as to its surplus in excess of the amount thereof stipulated in the agreement, or be the basis of any setoff; but until repaid, financial statements filed or published by the insurer shall show as a footnote thereto the amount thereof then unpaid together with any interest thereon accrued but unpaid.
(3) Any such loan to a domestic stock or mutual insurer shall be subject to the approval of the office for the issue and the rate of interest to be paid. The insurer shall, in advance of the loan, file with the office a statement of the purpose of the loan and a copy of the proposed loan agreement. The office shall disapprove any proposed loan or agreement if it finds that the loan is unnecessary or excessive for the purpose intended; that the terms of the loan agreement are not fair and equitable to the parties and to other similar lenders, if any, to the insurer; or that the information so filed by the insurer is inadequate.
(4) Any such loan to a domestic stock or mutual insurer, or a substantial portion thereof, shall be repaid by the insurer when no longer reasonably necessary for the purpose originally intended. No repayment of such a loan shall be made by a domestic stock or mutual insurer unless approved in advance by the office.
(5) This section does not apply to loans obtained by the insurer in the ordinary course of business from banks and other financial institutions, nor to loans secured by pledge or mortgage of assets.
History.—s. 660, ch. 59-205; ss. 13, 35, ch. 69-106; s. 1, ch. 73-165; s. 3, ch. 76-168; s. 1, ch. 77-13; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 1, 2, ch. 80-19; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1277, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.411 - Impairment of capital or assets.

628.411 Impairment of capital or assets.—
(1) If a domestic stock insurer’s capital, as represented by the aggregate par value of its outstanding capital stock, becomes impaired, or if the assets of a mutual insurer are less than the sum of its liabilities and the minimum amount of surplus required to be maintained by it, the office shall at once determine the amount of deficiency and serve notice upon the insurer to make good the deficiency within 90 days after service of such notice.
(2) The deficiency may be made good in cash or in assets eligible for the investment of the insurer’s funds; or by amendment of the insurer’s certificate of authority to cover only such kind or kinds of insurance thereafter for which the insurer has sufficient paid-in capital, if a stock insurer, or surplus, if a mutual insurer, under this code; or, if a stock insurer, by reduction of the insurer’s authorized capital stock through amendment of its certificate of incorporation, to an amount of paid-in capital stock not below the minimum required for the kinds of insurance thereafter to be transacted.
(3) After any such reduction of authorized capital stock the insurer shall have the right to require the return of the original certificate of stock held by each stockholder in exchange for new certificates to be issued in lieu thereof for such number of shares as the stockholder is entitled to in the proportion that the reduced capital bears to the original capital.
(4) If the deficiency is not made good and proof thereof filed with the office within such 90-day period, the insurer shall be deemed insolvent and the office shall institute delinquency proceedings against it under chapter 631; except that if such deficiency exists because of increased loss reserves required by the office, or because of disallowance by the office of certain assets or reduction of the value at which carried in the insurer’s accounts, the office may, in its discretion and upon application and good cause shown, and if it finds that the establishment or maintenance of such inadequate reserves or overvalued assets was not willful on the part of the insurer, extend for not more than an additional 60 days the period within which such deficiency may be so made good and such proof thereof so filed.
History.—s. 661, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 660, 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1278, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.421 - Assessment of stockholders or members.

628.421 Assessment of stockholders or members.—
(1) Any insurer receiving the notice of the office mentioned in s. 628.411(1):
(a) If a stock insurer, by resolution of its board of directors and subject to any limitations upon assessment contained in its certificate of incorporation, may assess its stockholders for amounts necessary to cure the deficiency and provide the insurer with a reasonable amount of surplus in addition. If any stockholder fails to pay a lawful assessment after notice given to him or her in person or by advertisement in such time and manner as approved by the office, the insurer may require the return of the original certificate of stock held by the stockholder and, in cancellation and in lieu thereof, issue a new certificate for such number of shares as the stockholder may then be entitled to, upon the basis of the stockholder’s proportionate interest in the amount of the insurer’s capital stock as determined by the office to be remaining at the time of determination of the amount of impairment under s. 628.411, after deducting from such proportionate interest the amount of such unpaid assessment. The insurer may pay for or issue fractional shares under this subsection.
(b) If a mutual insurer, shall levy such an assessment upon members as is provided for under
1
s. 628.321.
(2) Neither this section nor s. 628.411 shall be deemed to prohibit the insurer from curing any such deficiency through any lawful means other than those referred to in such sections.
History.—s. 662, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 383, ch. 97-102; s. 1279, ch. 2003-261.
1
Note.—Repealed by s. 185, ch. 91-108.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.431 - Mutualization of stock insurers.

628.431 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 office.
(2) The office shall not approve any such plan, procedure, or mutualization unless:
(a) It is equitable to stockholders and policyholders;
(b) It is subject to approval by the holders of not less than three-fourths of the insurer’s outstanding capital stock having voting rights and by not less than two-thirds of the insurer’s policyholders who vote on such plan in person, by proxy, or by mail pursuant to such notice and procedure as may be approved by the office;
(c) If a life insurer, the right to vote thereon is limited to holders of policies other than term or group policies, and whose policies have been in force for more than 1 year;
(d) Mutualization will result in retirement of shares of the insurer’s capital stock at a price not in excess of the fair market value thereof as determined by competent disinterested appraisers;
(e) The plan provides for the purchase of the shares of any nonconsenting stockholder in the same manner and subject to the same applicable conditions as provided by
1
s. 607.247, as to rights of nonconsenting stockholders, with respect to consolidation or merger of private corporations;
(f) The plan provides for definite conditions to be fulfilled by a designated early date upon which such mutualization will be deemed effective; and
(g) The mutualization leaves the insurer with surplus funds reasonably adequate for the security of its policyholders and to enable it to continue successfully in business in the states in which it is then authorized to transact insurance, and for the kinds of insurance included in its certificates of authority in such states.
(3) This section does not apply to mutualization under order of court pursuant to rehabilitation or reorganization of an insurer under chapter 631.
History.—s. 663, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; s. 12, ch. 79-9; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1280, ch. 2003-261.
1
Note.—Repealed by s. 189, ch. 90-179.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.471 - Mergers; mutual insurers.

628.471 Mergers; mutual insurers.—
(1) A domestic mutual insurer shall not merge with a stock insurer.
(2) A domestic mutual insurer may merge with another mutual insurer under the applicable procedures prescribed by the statutes of this state applying to corporations formed for profit, except as hereinbelow provided.
(3) The plan and agreement for merger shall be submitted to and approved by at least two-thirds of the members of each mutual insurer voting thereon at meetings called for the purpose pursuant to such reasonable notice and procedure as has been approved by the office. If a life insurer, the right to vote may be limited to members whose policies are other than term and group policies and have been in effect for more than 1 year.
(4) No such merger shall be effectuated unless in advance thereof the plan and agreement therefor have been filed with the office and approved by it. The office shall give such approval unless it finds such plan or agreement:
(a) Is inequitable to the policyholders of any domestic insurer involved; or
(b) Would substantially reduce the security of and service to be rendered to policyholders of the domestic insurer in this state and elsewhere.
History.—s. 667, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 74, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1285, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.481 - Bulk reinsurance; stock insurers.

628.481 Bulk reinsurance; stock insurers.—
(1) A domestic stock insurer may reinsure all or substantially all of its insurance in force or a major class thereof, with another insurer by an agreement of bulk reinsurance; but no such agreement shall become effective unless filed with the office and approved by it in writing.
(2) The office shall approve such agreement unless it finds that it is inequitable to the stockholders of the domestic insurer or it would substantially reduce the protection or service to its policyholders.
History.—s. 668, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1286, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.491 - Mergers and consolidations; mutual insurers; agreement of bulk reinsurance.

628.491 Mergers and consolidations; mutual insurers; agreement of bulk reinsurance.—
(1) A domestic mutual insurer may reinsure all or substantially all 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 such agreement shall become effective unless filed with the office and approved by it.
(2) The office shall approve such agreement if it finds it to be fair and equitable to each domestic insurer involved, and that such reinsurance if effectuated would not substantially reduce the protection or service to its policyholders.
(3) The plan and agreement for such reinsurance must be approved by vote of not less than two-thirds of each domestic mutual insurer’s members voting thereon at meetings of members called for the purpose, pursuant to such reasonable notice and procedure as the office may approve. If a life insurer, the right to vote may be limited to members whose policies are other than term or group policies and have been in effect for more than 1 year.
(4) If for reinsurance of a mutual insurer in a stock insurer, the agreement must provide for payment in cash to each member of the insurer entitled thereto, as upon conversion of such insurer pursuant to s. 628.441, of his or her equity in the business reinsured as determined under a fair formula approved by the office, which equity shall be based upon such member’s equity in the reserves, assets (whether or not admitted assets), and surplus, if any, of the mutual insurer to be taken over by the stock insurer.
History.—s. 669, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 385, ch. 97-102; s. 1287, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.501 - Mutual member’s share of assets on liquidation.

628.501 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, shall be distributed to existing persons who were its members at any time within 5 years next preceding the date such liquidation was authorized or ordered, or date of last termination of the insurer’s certificate of authority, whichever date is the earlier; except, that if the office has reason to believe that those in charge of the management of the insurer have caused or encouraged the reduction of the number of members of the insurer in anticipation of liquidation and for the purpose of reducing thereby the number of persons who may be entitled to share in distribution of the insurer’s assets, it may enlarge the 5 years’ qualification period above provided for by such additional period as it may deem to be reasonable.
(2) The distributive share of each such member shall be in the proportion that the aggregate premiums earned by the insurer on the policies of the member during the combined periods of his or her membership bear to the aggregate of all premiums so earned on the policies of all such members. The insurer may, and if a life insurer shall, make a reasonable classification of its policies so held by such members, and a formula based upon such classification, for determining the equitable distributive share of each such member. Such classification and formula shall be subject to the approval of the office.
History.—s. 670, ch. 59-205; ss. 13, 35, ch. 69-106; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 665, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 386, ch. 97-102; s. 1288, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.511 - Ownership or transfer of securities without physical delivery of certificates.

628.511 Ownership or transfer of securities without physical delivery of certificates.—
(1) The purpose of this section is to authorize domestic insurers to use modern systems for holding and transferring securities without physical delivery of securities certificates, subject to appropriate rules of the commission.
(2) The following terms are defined for use in this section:
(a) “Securities” means instruments as defined in s. 678.1021.
(b) “Clearing corporation” means a clearing corporation as defined in s. 678.1021 and includes the Treasury/Reserve Automated Debt Entry System or Treasury Direct book-entry securities systems as established pursuant to 31 U.S.C. chapter 31, 12 U.S.C. s. 391, and 5 U.S.C. s. 301.
(c) “Custodian” means a national bank, state bank, trust company, broker, or dealer that participates in a clearing corporation.
(3) Notwithstanding any other provision of law, a domestic insurer may deposit or arrange for the deposit of securities held in or purchased for its general account and its separate accounts in a clearing corporation. When securities are deposited with a clearing corporation, certificates representing securities of the same class of the same issuer may be merged and held in bulk in the name of the nominee of such clearing corporation with any other securities deposited with such clearing corporation by any person, regardless of the ownership of such securities, and certificates representing securities of small denominations may be merged into one or more certificates of larger denominations. The records of any custodian through which an insurer holds securities in a clearing corporation shall at all times show that such securities are held for such insurer and for which accounts thereof. Ownership of, and other interests in, such securities may be transferred by bookkeeping entry on the books of such clearing corporation without physical delivery of certificates representing such securities.
(4) The commission may adopt rules governing the deposit by insurers of securities with clearing corporations.
History.—ss. 663, 809(1st), ch. 82-243; s. 72, ch. 82-386; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1289, ch. 2003-261; s. 3, ch. 2007-138.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.520 - Change of domicile of a foreign insurer.

628.520 Change of domicile of a foreign insurer.—Any insurer which is organized under the laws of any other state for the purpose of writing insurance may become a domestic insurer by complying with all of the requirements of law relative to the organization and licensing of a domestic insurer of the same type and by designating its principal place of business at a place in this state upon approval by the office. Such domestic insurer shall be entitled to like certificates and licenses to transact business in this state and shall be subject to the authority and jurisdiction of this state.
History.—s. 7, ch. 85-214; s. 1, ch. 86-286; ss. 75, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1290, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.525 - Change of domicile of a domestic insurer.

628.525 Change of domicile of a domestic insurer.—Any domestic insurer may, upon the approval of the office, transfer its domicile to any other state in which it is admitted to transact the business of insurance; upon such a transfer it shall cease to be a domestic insurer and shall be admitted to this state, if qualified, as a foreign insurer. The office shall approve any such proposed transfer unless it shall determine that such transfer is not in the interest of the policyholders of this state.
History.—s. 7, ch. 85-214; s. 1, ch. 86-286; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1291, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.530 - Effects of redomestication.

628.530 Effects of redomestication.—The certificate of authority, agents appointments and licenses, rates, and other items which the office or department allows, in its discretion, which are in existence at the time any insurer licensed to transact the business of insurance in this state transfers its corporate domicile to this or any other state by merger, consolidation, merger pursuant to s. 607.1101(7), or any other lawful method shall continue in full force and effect upon such transfer if such insurer remains duly qualified to transact the business of insurance in this state. All outstanding policies of any transferring insurer shall remain in full force and effect and need not be endorsed as to the new name of the company or its new location unless so ordered by the office. Every transferring insurer shall file new policy forms with the office on or before the effective date of the transfer, but may use existing policy forms with appropriate endorsements if allowed by, and under such conditions as are approved by, the office. However, every such transferring insurer shall notify the office of the details of the proposed transfer and shall file promptly any resulting amendments to corporate documents filed or required to be filed with the office.
History.—s. 7, ch. 85-214; s. 1, ch. 86-286; s. 180, ch. 90-179; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 1292, ch. 2003-261; s. 288, ch. 2019-90.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part I - Stock and Mutual Insurers: Organization and Corporate Procedures (Ss. 628.011-628.535) › 628.535 - Authority to adopt rules.

628.535 Authority to adopt rules.—The commission may adopt rules pursuant to ss. 120.536(1) and 120.54 to implement the provisions of this chapter.
History.—s. 7, ch. 85-214; s. 1, ch. 86-286; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 206, ch. 98-200; s. 1293, ch. 2003-261.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part II - Assessable Mutual Insurers (Ss. 628.6011-628.6018) › 628.6011 - Assessable mutual insurers.

628.6011 Assessable mutual insurers.—
(1) An “assessable mutual insurer” is an insurer incorporated in Florida without permanent capital stock which has only policyholders, insureds, or risks located in Florida and which transacts insurance only within Florida. An assessable mutual insurer may be formed only in accordance with part I. Members of the assessable mutual have a contingent liability for discharge of its liabilities as provided in this part. An assessable mutual may be authorized to offer only property, health, and casualty insurance.
(2) The assessable mutual shall not participate in the Florida Insurance Guaranty Association or the Florida Life and Health Insurance Guaranty Association.
History.—ss. 76, 188, ch. 91-108; s. 4, ch. 91-429; s. 9, ch. 92-328.
2023 Florida Statutes › Title XXXVII - Insurance › Chapter 628 - Stock and Mutual Insurers; Holding Companies › Part II - Assessable Mutual Insurers (Ss. 628.6011-628.6018) › 628.6012 - Premiums written; restrictions.

628.6012 Premiums written; restrictions.—Assessable mutual insurers shall be subject to a cap on net annual premiums on the same basis and in the same manner as provided in former s. 624.469 as to commercial self-insurance funds. For an assessable mutual that has converted from a commercial self-insurance fund, the first 6 full calendar years of its operation as set forth in former s. 624.469 shall be computed from the date of its certificate of authority as a commercial self-insurance fund.
History.—ss. 76, 188, ch. 91-108; s. 4, ch. 91-429; s. 126, ch. 2004-5.