2023 New York Laws › ISC - Insurance › Article 12 - Organization and Corporate Procedure › 1202 - Number of Directors; Independent Directors and Committees of the Board of Directors; Duty of Directors.

§  1202.  Number of directors; independent directors and committees of
the board of directors; duty of directors. (a) (1) Subject to  item  (v)
of  subparagraph  (B) of paragraph five of subsection (a) of section one
thousand two hundred one of this article, and subject to  any  provision
of  the corporate charter of a domestic insurance company, the number of
directors shall be fixed by the by-laws, or if not so fixed,  by  action
of the directors.
(2)  If  not  otherwise  fixed under this article, the number shall be
seven but it may be increased or decreased by amendment of the  by-laws,
or  by action of the board, subject to the following limitations: (i) if
the board is authorized by the  by-laws  to  increase  or  decrease  the
number  of directors, the amendment shall require the vote of a majority
of the entire board; (ii) no decrease shall  shorten  the  term  of  any
incumbent  director;  and  (iii)  no decrease shall reduce the number of
directors to fewer than seven.
(3) The charters of all domestic insurance companies  approved  before
January first, nineteen hundred forty which fail to comply with item (v)
of  subparagraph  (B) of paragraph five of subsection (a) of section one
thousand two hundred one of this article but  which  were  validated  by
section  forty-eight-a  of  the  former insurance law in effect prior to
this chapter remain so validated and shall not be affected by such  item
or  paragraph  one  or  two of this subsection in respect of the minimum
number of directors.
(b) (1) Subject to item (v) of subparagraph (B) of paragraph  five  of
subsection  (a) of section one thousand two hundred one of this article,
not less than one-third of  the  directors  of  a  domestic  stock  life
insurance  company  and  not  less than one-third of the members of each
committee of the board of  directors  of  any  domestic  life  insurance
company  shall  be  persons  who  are  not officers or employees of such
company or of any entity controlling, controlled  by,  or  under  common
control  with  such  company  and  who  are  not  beneficial owners of a
controlling interest in the voting stock of such  company  or  any  such
entity. At least one such person shall be included in any quorum for the
transaction  of business at any meeting of the board of directors or any
committee thereof.
(2) The board of directors of a domestic life insurance company  shall
establish  one  or more committees comprised solely of directors who are
not officers or employees of the company or of any  entity  controlling,
controlled  by, or under common control with the company and who are not
beneficial owners of a controlling interest in the voting stock  of  the
company  or  any  such  entity.  Such committee or committees shall have
responsibility for recommending the selection of  independent  certified
public  accountants,  reviewing  the  company's financial condition, the
scope and results of the  independent  audit  and  any  internal  audit,
nominating  candidates  for  director  for  election  by shareholders or
policyholders, evaluating the performance of  officers  deemed  by  such
committee  or  committees  to  be principal officers of the company, and
recommending to the board of directors the selection and compensation of
such principal officers and  in  the  case  of  a  domestic  stock  life
insurance  company,  recommending  to its board of directors any plan to
issue options to its officers and employees for the purchase  of  shares
of  stock,  pursuant  to  section one thousand two hundred seven of this
article.
(3) The provisions of this subsection shall not apply  to  a  domestic
life insurance company if the holding company or parent corporation is a
foreign  or  domestic  insurance  company,  a  mutual  insurance holding
company established pursuant to the laws of  the  United  States,  or  a
publicly  held  corporation  incorporated in the United States, having a

board  of  directors  and  committees  thereof  that   meet   the   same
requirements  as  have  been  established  for  a  domestic  stock  life
insurance company pursuant to paragraphs one and two of this subsection.
In  such  a  case,  the  directors  of  the  holding  company  or parent
corporation shall be subject to this chapter in the same manner  as  the
directors of a domestic stock life insurance company.
(c)  A director of a domestic life insurance company shall perform his
duties as a director, including his duties as a member of any  committee
of  the board upon which he may serve, in accordance with the provisions
of section seven hundred seventeen of the business corporation  law  and
the provisions of this chapter.