reglab/statecodes huggingface dataset:
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-40. Notice of annual meetings.

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. Notice of a change must be given:
(1) by imprinting the new time or place on all policies which are issued following the annual meeting at which a change was approved; and
(2) by including a written notice of the change in a premium due notice to each member subsequent to the annual meeting at which the change was approved and before the first annual meeting affected by the change; or
(3) by any other method ordered or approved by the director or his designee.
HISTORY: Former 1976 Code Section 38-19-40 [1962 Code Section 37-823; 1971 (57) 1001] recodified as Section 38-31-40 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-11-240 [1947 (45) 322; 1952 Code Section 37-374; 1962 Code Section 37-374] recodified as Section 38-19-40 by 1987 Act No. 155, Section 1; 1988 Act No. 334, Section 3; 1993 Act No. 181, Section 551.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-50. Use of proxies.

(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 expiration is otherwise specified, an appointment is valid for eleven months.
(B) No member's vote upon any proposal (1) to divest the insurer of its business and assets, or the major part of it, or (2) to change the corporate structure of the insurer as provided in Article 9 of this chapter may be registered or taken except in person or by a proxy newly executed and specific as to the matter to be voted upon.
(C) No proxy may be utilized by a domestic mutual insurer subject to the provisions of this chapter unless the language and form of the proxy have been approved by the director or his designee.
HISTORY: Former 1976 Code Section 38-19-50 [1962 Code Section 37-824; 1971 (57) 1001] recodified as Section 38-31-50 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-11-250 [1947 (45) 322; 1952 Code Section 37-375; 1962 Code Section 37-375] recodified as Section 38-19-50 by 1987 Act No. 155, Section 1; 1988 Act No. 334, Section 4; 1993 Act No. 181, Section 552; 1997 Act No. 68, Section 6.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-60. Quorum for conduct of business at annual meeting; form and approval of voting proxies.

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 requirements may limit the conduct of this business.
HISTORY: Former 1976 Code Section 38-19-60 [1962 Code Section 37-825; 1971 (57) 1001; 1976 Act No. 666] recodified as Section 38-31-60 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-11-260 [1962 Code Section 37-375.1; 1976 Act No. 533] recodified as 38-19-60 by 1987 Act No. 155, Section 1; 1988 Act No. 334, Section 5.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-270. Dividends.

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 from its business. Any classification of its participating policies and of risks assumed thereunder which the insurer may make must be reasonable. No dividend may be paid which is inequitable or which unfairly discriminates as between the classifications or as between policies within the same classification. No dividend, otherwise earned, may be made contingent upon the payment of a renewal premium on any policy.
HISTORY: Former 1976 Code Section 38-11-480 [1947 (45) 322; 1952 Code Section 37-388; 1962 Code Section 37-388] recodified as Section 38-19-270 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-410. Contingent liability 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 incorporation but may not be less than one nor more than five additional premiums for the member's policy at the annual premium rate. Every policy issued by the insurer shall contain a statement of the contingent liability. Cancellation of the policy of a member does not relieve the member of contingent liability for his proportion of the obligations of the insurer which accrued while the policy was in force.
HISTORY: Former 1976 Code Section 38-11-610 [1947 (45) 322; 1952 Code Section 37-401; 1962 Code Section 37-401] recodified as Section 38-19-410 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-420. Contingent liability is not an asset of the insurer.

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.
HISTORY: Former 1976 Code Section 38-11-620 [1947 (45) 322; 1952 Code Section 37-402; 1962 Code Section 37-402] recodified as Section 38-19-420 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-430. Validity of guaranty against liability.

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 of this nature is void.
HISTORY: Former 1976 Code Section 38-11-630 [1947 (45) 322; 1952 Code Section 37-403; 1962 Code Section 37-403] recodified as Section 38-19-430 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-440. Assessments for deficiencies.

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 the twelve months immediately preceding the date the assessment was authorized by the directors, held policies providing for contingent liability. The director or his designee may refuse to approve the assessment if in his judgment refusal will best promote the interests of the insurer's members and creditors and of the insuring public.
HISTORY: Former 1976 Code Section 38-11-640 [1947 (45) 322; 1952 Code Section 37-404; 1962 Code Section 37-404] recodified as Section 38-19-440 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 553.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-450. Computation of individual assessments.

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 policies. In computing the earned premiums for the purposes of this section the gross premium received by the insurer for the policy must be used as a base, deducting charges not recurring upon the renewal or extension of the policy.
No member may have an offset against any assessment for which he is liable on account of any claim for unearned premium or losses payable.
HISTORY: Former 1976 Code Section 38-11-650 [1947 (45) 322; 1952 Code Section 37-405; 1962 Code Section 37-405] recodified as Section 38-19-450 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-460. Enforcement of contingent liability on assessment premium plan.

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.
HISTORY: Former 1976 Code Section 38-11-660 [1947 (45) 322; 1952 Code Section 37-406; 1962 Code Section 37-406] recodified as Section 38-19-460 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-470. Nonassessable policies.

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 assessment and omit provisions imposing contingent liability in all policies currently issued. Any deposit made with the director or his designee as a prerequisite to the insurer's certificate of authority may be included as part of the surplus referred to in this section. When the surplus has been established and the director or his designee has so ascertained, he shall issue to the insurer, at its request, his certificate authorizing the extinguishment of the contingent liability of its members and the issuance of policies free from contingent liability.
HISTORY: Former 1976 Code Section 38-11-670 [1947 (45) 322; 1952 Code Section 37-407; 1962 Code Section 37-407] recodified as Section 38-19-470 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 554.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-480. Nonassessable plan applies to all policies.

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 kinds of insurance transacted by it.
HISTORY: Former 1976 Code Section 38-11-680 [1947 (45) 322; 1952 Code Section 37-408; 1962 Code Section 37-408] recodified as Section 38-19-480 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 555.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-490. Revocation of authority to issue nonassessable policies.

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 of business; or
(2) the insurer, by resolution of its directors approved by its members, requests that the authority be revoked.
Upon revocation of this authority for any cause the insurer may not thereafter issue any policies without contingent liability nor renew any policies then in force without written endorsement thereon providing for contingent liability.
HISTORY: Former 1976 Code Section 38-11-690 [1947 (45) 322; 1952 Code Section 37-409; 1962 Code Section 37-409] recodified as Section 38-19-490 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 556.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-610. Borrowed surplus.

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 interest as agreed upon must be repaid only out of the insurer's earned surplus in excess of its required minimum surplus. If the money is to be borrowed upon multiple agreements, the agreements must be serially numbered. No loan agreement or series of agreements may have or be given any preferential rights over any other such loan agreement or series. No commission or promotional expense may be paid to a director, officer, or employee of the insurer on account of this loan.
The director's or his designee's approval of the loan, if granted, shall specify the amount to be borrowed, the purpose for which the money is to be used, the terms and forms of the loan agreement, the date by which the loan must be completed, and other related matters the director or his designee considers proper.
This article 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: Former 1976 Code Section 38-11-810 [1947 (45) 322; 1952 Code Section 37-421; 1962 Code Section 37-421; 1972 (57) 2676; 1974 (58) 2300] recodified as Section 38-19-610 by 1987 Act No. 155, Section 1; 1988 Act No. 334, Section 6; 1993 Act No. 181, Section 557.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-620. Loans may not be part of legal liabilities but must be reflected in financial statements.

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 but unpaid.
HISTORY: Former 1976 Code Section 38-11-820 [1947 (45) 322; 1952 Code Section 37-422; 1962 Code Section 37-422] recodified as Section 38-19-620 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-630. Repayment of loans.

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 earned surplus has become adequate to repay without impairing the insurer's operations.
HISTORY: Former 1976 Code Section 38-11-830 [1947 (45) 322; 1952 Code Section 37-423; 1962 Code Section 37-423] recodified as Section 38-19-630 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-640. Repayment of more than one loan or by multiple agreement.

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 of the director or his designee, of those loan agreements, out of all similar agreements then outstanding, to be then repaid in part or in whole.
HISTORY: Former 1976 Code Section 38-11-840 [1947 (45) 322; 1952 Code Section 37-424; 1962 Code Section 37-424] recodified as Section 38-19-640 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 558.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-650. Director's approval required for repayment.

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 immediately ascertain whether the insurer's financial condition is such that the repayment can properly be made.
HISTORY: Former 1976 Code Section 38-11-850 [1947 (45) 322; 1952 Code Section 37-425; 1962 Code Section 37-425] recodified as Section 38-19-650 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 559.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-660. Rights of holders of loan upon dissolution.

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.
HISTORY: Former 1976 Code Section 38-11-860 [1947 (45) 322; 1952 Code Section 37-426; 1962 Code Section 37-426] recodified as Section 38-19-660 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-815. Definitions.

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 assumption of all of its risks and obligations by the other insurer and proceeds to liquidation.
(2) "Merger" means a transaction in which a mutual insurer is absorbed by another mutual insurer, its assets, franchises, powers, and liabilities are acquired by the other insurer, and it ceases to exist as a separate business entity.
(3) "Conversion" means a transaction in which a mutual insurer reorganizes as a stock insurer and the ownership rights of the members of the mutual insurer are exchanged for cash, stock, or both stock and cash as may be provided by the plan of conversion.
HISTORY: 1988 Act No. 334, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1010. Fire and storm insurance; suits; seals.

The corporation Farmers Mutual Insurance Association of Newberry, S.C. shall have the right to mutually insure the respective dwelling houses, barns, and other buildings and property of every kind and nature of its members, in Newberry County, in counties contiguous thereto, and in any other county in this State where another county mutual insurance association is not authorized to do business by law against loss by fire, winds, or lightning, or other casualty, and to write all forms of property, casualty, and marine insurance as those terms are defined by law, all upon those terms and under those conditions as may be fixed by the bylaws of the corporation provided that all insurance against liability of the insured to other persons must be fully reinsured by the corporation in or with one or more insurance companies licensed to insure these risks under the laws of this State. It may sue and be sued in any court in this State and may have and use a common seal.
HISTORY: 1893 Act No. 462, Section 2; 1968 Act No. 1617; 1988 Act No. 393.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1020. Directors and officers; regulations.

The corporation may make by-laws, fixing the number of its board of directors and other officers, and defining the duties and powers of the directors and officers; also making rules and regulations governing the corporation and the conduct of its business, not inconsistent with the laws of this State.
HISTORY: 1893 Act No. 462, Section 3.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1030. Liability of members; property pledged; lien.

Every member of said corporation shall be, and is hereby, bound and obliged to pay his, her or their portion of all losses and expenses accruing to said corporation; and all buildings or other property insured by and with said corporation, together with the rights, title and interest of assured to the lands on which such building or other property may stand, shall be pledged to the said corporation, and the said corporation shall have a lien thereon against the assured, his or her heirs, representatives and assigns, during the continuance of their insurance, as to all debts or liabilities contracted or incurred by said corporation subsequent to the passage of Sections 38-19-1010 through 38-19-1050.
HISTORY: 1893 Act No. 462, Section 4.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1040. Extent of liability; release by transfer rights of purchaser.

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 transfer of such property shall operate as a release of the same under the provisions of Sections 38-19-1010 through 38-19-1050, as to all subsequent liabilities, unless the purchaser or purchasers thereof shall make application to the Board of Directors for a continuance of said insurance within ten days from the date of such transfer, in which event such purchaser or purchasers shall be substituted to all the rights of the vendor under Sections 38-19-1010 through 38-19-1050, and the said property shall be held liable as herein provided, and the provisions of this Section shall apply as well to personal representatives and guardians as to purchasers of such property.
HISTORY: 1893 Act No. 462, Section 5.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1120. Transition to domestic mutual insurance holding company system; membership interests of policyholders.

(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 or more intermediate stock holding companies and other subsidiaries. The reorganized mutual insurer shall continue, without interruption, its corporate existence as a stock insurance subsidiary of the mutual insurance holding company or as a subsidiary to one or more intermediate stock holding companies.
(B) A domestic or foreign mutual insurer may reorganize by merging its policyholders' membership interests into an existing domestic mutual insurance holding company formed under subsection (A) of this section. The reorganized mutual insurer shall continue, without interruption, its corporate existence as a stock insurance subsidiary of the mutual insurance holding company or as a subsidiary to one or more intermediate stock holding companies.
(C) Upon reorganization, the membership interests of the policyholders of the reorganized insurer shall become membership interests in the mutual insurance holding company. Policyholders of the reorganized insurance company shall be members of the mutual insurance holding company in accordance with the articles of incorporation and bylaws of the mutual insurance holding company. All initial shares of the capital stock of the reorganized insurance company shall be issued to the mutual insurance holding company or to an intermediate holding company which is wholly owned by the mutual insurance holding company. On and after the effective date of the reorganization, the mutual insurance holding company shall at all times, directly or indirectly, own a majority of the voting securities of the reorganized insurance company. The mutual insurance holding company shall, at all times, be wholly-owned by and operated in the interests of the members of the mutual insurance holding company. "Voting securities" means securities having voting power for the election of the board of directors of the reorganized insurance company other than securities having voting power only because of the occurrence of a contingency.
(D) A domestic mutual insurer may reorganize only pursuant to a plan of reorganization adopted by its board of directors and approved by the Director of the Department of Insurance and policyholders as provided in this article.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1140. Review of plan; costs; public hearing; order of approval or disapproval.

(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 review, including those costs attributable to staff personnel, shall be paid by the insurer making the filing. During the process of review, the director may communicate with the mutual insurer and request such additional information from the mutual insurer as the director may consider necessary.
(B) The director or his designee must conduct a public hearing regarding the proposed plan of reorganization no later than forty-five days from when the filing is deemed complete. Any interested person may appear and participate at the hearing. The director or his designee must provide notice of the public hearing by publication in a newspaper of general circulation.
(C) Within one hundred twenty days of the filing of the plan which is considered to be complete by the director, the director shall issue an order approving or disapproving the plan. The director shall approve the plan if the director determines:
(1) the requirements of this article have been met;
(2) the director is satisfied that the interests of the policyholders are preserved and protected and that the plan of reorganization is fair and equitable to the policyholders, and in the best interests of the policyholders;
(3) the directors, officers, agents, and employees are not unjustly enriched by the reorganization plan. The approval of the director shall be conditioned upon the approval of the policyholders as provided in this article. If the director does not approve the plan, then the director shall issue an order setting forth in detail the reasons for disapproval. If a plan is disapproved, then the mutual insurer may resubmit the plan to the director within thirty days of receipt of the order of disapproval. Within ninety days after the filing of the resubmitted plan, which is considered to be complete by the director, the director shall issue an order approving or disapproving the resubmitted plan. The approval of the resubmitted plan shall be conditioned upon the approval of the policyholders as provided by this article. If the director disapproves the resubmitted plan, then the mutual insurer may seek judicial review of the director's decision in the circuit court of common pleas for Richland County.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1150. Policyholder meeting to vote on plan.

(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 thirty days' notice, by first class mail, to the last known address of each policyholder that the plan of reorganization will be voted on at a regular or special meeting of the policyholders. If the meeting of policyholders to vote upon the plan of reorganization is held coincident with the mutual insurer's annual meeting of the policyholders, only one combined notice of meeting is required.
(B) The notice shall include a description of the plan of reorganization and a statement that the director has reviewed the proposed plan of reorganization and has approved the plan subject to the approval of the policyholders. The notice to policyholders will include a statement by the director that the director's approval pursuant to this section is not a recommendation to either accept or reject the Plan of Reorganization. The notice to each policyholder shall also include a written proxy permitting the policyholder to vote for or against the plan of reorganization. A plan of reorganization shall be approved by the affirmative vote of a two-thirds majority of the policyholders voting in person or by proxy at the meeting.
(C) For purposes of voting, policyholders means the policyholders of the mutual insurer on the day the plan of reorganization is initially approved by the board of directors of the mutual insurer. The entity to which a group insurance policy is issued, and not a person covered under the group insurance policy, shall be considered the policyholder for purposes of voting. Each policyholder shall be entitled to only one vote regardless of the number of policies owned by the policyholder.
(D) If a mutual insurer substantially complies in good faith with the notice requirements of this section, the mutual insurer's failure to give a policyholder a required notice does not impair the validity of an action taken under this section.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1160. Filing articles of incorporation; issuance of certificate of authority.

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. The director shall issue a certificate of authority when the mutual insurer files with the director a certificate from the mutual insurer setting forth the vote and certifying that the plan of reorganization was approved by not less than a two-thirds majority of the policyholders voting in person or by proxy on the plan of reorganization, that the articles of incorporation have been filed with the Secretary of State, and payment of all applicable fees to the Department of Insurance. The reorganization shall be effective upon the issuance of a certificate of authority by the director.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1170. Membership interest as security; transfer of interest.

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.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1180. Dividends and distributions; effect of adoption or implementation of plan of reorganization.

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 give rise to an obligation on behalf of a mutual insurance holding company to make a distribution or payment to a member or policyholder, or to another person, board, or entity of any nature whatsoever, in connection with the ownership, control, benefits, policies, purpose, or nature of the mutual insurance company, or otherwise.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1190. Demutualization.

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 insurance holding company.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1200. Confidentiality of information disclosed pursuant to application to reorganize.

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 policyholders in connection with the meeting of policyholders, shall be given confidential treatment and shall not be subject to subpoena and shall not be released to another person or entity without the prior written consent of the insurer.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1210. Applicability of insurance laws; exemptions for entities not writing insurance; mergers; protection of policyholder interests; promulgation of regulations.

(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 company that elects not to write insurance from any provisions of this title or regulations adopted thereunder with respect to the writing of insurance or requirements related to capital, surplus, dividends, reserves, borrowing or investments, or other provisions which the Director of the Department of Insurance determines are not applicable or should be modified. This exemption shall not change the mutual insurance holding company's status as a domestic insurer subject to the provisions of Title 38. A mutual insurance holding company, intermediate holding company, or reorganized mutual insurer may merge with, consolidate with, or acquire the assets of another person or entity, or take another action as consistent with the South Carolina Business Corporation Act or other applicable law.
(B) The director shall have jurisdiction over a mutual insurance holding company and an intermediate holding company to ensure that policyholder interests are preserved and protected.
(C) The director may promulgate regulations and issue orders to implement this article as provided by the insurance laws of this State consistent with the South Carolina Business Corporation Act.
(D) A mutual insurance holding company and subsidiaries or affiliates shall be subject to all applicable provisions of South Carolina's Insurance Holding Company Regulatory Act.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1220. Availability of assets to satisfy policyholder claims in proceedings for supervision, rehabilitation or liquidation; dissolution.

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 of satisfying the claims of policyholders. A mutual insurance holding company or an intermediate stock holding company may not be dissolved without approval of the Director of the Department of Insurance. A mutual insurance holding company and an intermediate stock holding company each shall be considered an insurer subject to the Administrative Supervision of Insurers Act and the Insurers Rehabilitation and Liquidation Act.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1230. Filing of annual statements; audit; notice of stock offering.

(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 company.
(B) A mutual insurance holding company shall have an annual audit by an independent certified public accountant and shall file an audited financial report with the Director of the Department of Insurance by June first of each year.
(C) A mutual insurance holding company shall notify the director ninety days prior to any initial and subsequent subsidiary stock offering for review by the director for compliance with all applicable state law and the offering shall be deemed approved by the director within thirty days of submission to the director unless the director states otherwise in writing within thirty days of submission.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 19 - Domestic Mutual Insurers › Section 38-19-1240. Time limitation for filing challenge to reorganization.

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.
HISTORY: 1998 Act No. 413, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-20. Authority of insurers to organize or acquire subsidiaries.

A domestic insurer, either by itself or in cooperation with one or more persons, may organize or acquire one or more subsidiaries engaged in the following kinds of business:
(1) Any kind of insurance business authorized by the jurisdiction in which it is incorporated;
(2) Acting as an insurance broker or as an insurance agent for its parent or for any of its parent's insurer subsidiaries;
(3) Investing, reinvesting, or trading in securities for its own account, that of its parent, any subsidiary of its parent, or any affiliate or subsidiary;
(4) Management of an investment company subject to or registered pursuant to the Investment Company Act of 1940, as amended, including related sales and services;
(5) Acting as a broker-dealer subject to or registered pursuant to the Securities Exchange Act of 1934, as amended;
(6) Rendering investment advice to governments, government agencies, corporations, or other organizations or groups;
(7) Rendering other services related to the operations of an insurance business, including, but not limited to, actuarial, loss prevention, safety engineering, data processing, accounting, claims, appraisal, and collection services;
(8) Ownership and management of assets which the parent corporation could itself own or manage;
(9) Acting as administrative agent for a governmental instrumentality which is performing an insurance function;
(10) Financing of insurance premiums, agents, and other forms of consumer financing;
(11) Any other business activity determined by the director or his designee to be reasonably ancillary to an insurance business; or
(12) Owning a corporation or corporations engaged or organized to engage exclusively in one or more of the businesses specified in this section.
HISTORY: Former 1976 Code Section 38-21-20 [1947 (45) 322; 1952 Code Section 37-852; 1962 Code Section 37-852] recodified as Section 38-37-20 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-29-20 [1962 Code Section 37-1401; 1971 (57) 351] recodified as Section 38-21-20 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 562.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-30. Authority of insurers to invest in securities of subsidiaries.

In addition to investment in common stock, preferred stock, debt obligations, and other securities permitted under this title, a domestic insurer may also:
(1) Invest, in common stock, preferred stock, debt obligations, and other securities of one or more subsidiaries, amounts which do not exceed the lesser of ten percent of the insurer's assets or fifty percent of the insurer's surplus as regards policyholders if, after these investments, the insurer's surplus as regards policyholders must be reasonable in relation to the insurer's outstanding liabilities and adequate to meet its financial needs. In calculating the amount of the investments, investments in domestic or foreign insurance subsidiaries must be excluded, and there must be included (a) total net monies or other consideration expended and obligations assumed in the acquisition or formation of a subsidiary, including all organizational expenses and contributions to capital and surplus of the subsidiary whether or not represented by the purchase of capital stock or issuance of other securities, and (b) all amounts expended in acquiring additional common stock, preferred stock, debt obligations, and other securities and all contributions to the capital or surplus of a subsidiary after its acquisition or formation;
(2) Invest any amount in common stock, preferred stock, debt obligations, and other securities of one or more subsidiaries engaged or organized to engage exclusively in the ownership and management of assets authorized as investments for the insurer if each subsidiary agrees to limit its investments in any asset so that the investments will not cause the total investment of the insurer to exceed any of the investment limitations specified in item (1) or in the investment laws or regulations of this State. For the purpose of this item, "the total investment of the insurer" includes (a) any direct investment by the insurer in an asset, and (b) the insurer's proportionate share of any investment in an asset by a subsidiary of the insurer, which must be calculated by multiplying the amount of the subsidiary's investment by the percentage of the ownership of the subsidiary;
(3) With the approval of the director or his designee, invest any greater amount in common stock, preferred stock, debt obligations, or other securities of one or more subsidiaries if after such investment the insurer's surplus as regards policyholders will be reasonable in relation to the insurer's outstanding liabilities and adequate to its financial needs.
HISTORY: Former 1976 Code Section 38-21-30 [1947 (45) 322; 1952 Code Section 37-853; 1962 Code Section 37-853] recodified as Section 38-37-30 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-29-30 [1962 Code Section 37-1402; 1971 (57) 351; 1986 Act No. 426, Section 2] recodified as Section 38-21-30 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 563.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-40. Investments in securities of subsidiaries are not subject to other restrictions.

Investments in common stock, preferred stock, debt obligations, or other securities of subsidiaries made pursuant to Section 38-21-30 are not subject to any other investment restrictions or prohibitions contained in this title.
HISTORY: Former 1976 Code Section 38-21-40 [1947 (45) 322; 1952 Code Section 37-854; 1962 Code Section 37-854] recodified as Section 38-37-40 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-29-40 [1962 Code Section 37-1403; 1971 (57) 351] recodified as Section 38-21-40 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-50. Determining compliance with provision authorizing investments in securities of subsidiaries; disposition of investments upon ceasing to control subsidiary.

Whether an investment meets the applicable requirements of Section 38-21-30 is to be determined before the investment is made by calculating the applicable investment limitations as though the investment had already been made, taking into account the then outstanding principal balance on all previous investments in debt obligations, and the value of all previous investments in equity securities as of the day they were made, net of any return of capital invested, not including dividends.
If an insurer ceases to control a subsidiary, it must dispose of any investment made pursuant to Section 38-21-30 within three years from the time of the cessation of control or within such further time that the director or his designee may prescribe unless, at any time after the investment has been made, the investment has met the requirements for investment under any other section of this title and the insurer has notified the director or his designee.
HISTORY: Former 1976 Code Section 38-21-50 [1947 (45) 322; 1952 Code Section 37-855; 1962 Code Section 37-855] recodified as Section 38-37-50 by 1987 Act No. 155, Section 1; Former 1976 Code Section 38-29-50 [1962 Code Section 37-1404; 1971 (57) 351; 1986 Act No. 426, Section 3] recodified as Section 38-21-50 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 564.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-80. Use of certain documents required by other laws in furnishing information called for in statement.

If any offer, request, invitation, agreement, or acquisition referred to in Section 38-21-60 is proposed to be made by means of a registration statement under the Securities Act of 1933 or in circumstances requiring the disclosure of similar information under the Securities Exchange Act of 1934, or under a state law requiring similar registration or disclosure, the person required to file the statement referred to in Section 38-21-60 may utilize these documents in furnishing the information called for by that statement.
HISTORY: Former 1976 Code Section 38-29-80 [1962 Code Section 37-1407; 1971 (57) 351; 1986 Act No. 426, Section 5A] recodified as Section 38-21-80 by 1987 Act No. 155, Section 1.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-100. Certain transactions exempt from Sections 38-21-60 to 38-21-120.

The provisions of Sections 38-21-60 to 38-21-120 do not apply to:
(1) Any transaction which is subject to Article 9, Chapter 19 dealing with the merger or consolidation of two or more insurers.
(2) Any offer, request, invitation, agreement, or acquisition which the director or his designee by order exempts as (a) not having been made or entered into for the purpose and not having the effect of changing or influencing the control of a domestic insurer, or (b) as otherwise not comprehended within the purposes of Sections 38-21-60 through 38-21-120.
HISTORY: Former 1976 Code Section 38-29-110 [1962 Code Section 37-1409; 1971 (57) 351; 1986 Act No. 426, Section 7] recodified as Section 38-21-100 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 568.
2023 South Carolina Code of Laws › Title 38 - Insurance › Chapter 21 - Insurance Holding Company Regulatory Act › Section 38-21-110. Violations of Sections 38-21-60 to 38-21-120.

The following are violations of Sections 38-21-60 to 38-21-120:
(1) the failure to file a statement, amendment, or other material required to be filed pursuant to Section 38-21-60 or 38-21-70; or
(2) the effectuation or an attempt to effectuate an acquisition or control of, divestiture of, or merger with a domestic insurer, unless the director or his designee has given his approval.
HISTORY: Former 1976 Code Section 38-29-120 [1962 Code Section 37-1410; 1971 (57) 351] recodified as Section 38-21-110 by 1987 Act No. 155, Section 1; 1993 Act No. 181, Section 569; 2015 Act No. 2 (S.342), Section 7, eff March 9, 2015.
Effect of Amendment
2015 Act No. 2, Section 7, in (1), substituted "failure to file a statement" for "failure to file any statement"; and in (2), substituted "effectuation or an attempt" for "effectuation or any attempt", and inserted "divestiture of,".