reglab/statecodes huggingface dataset:
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-105 - Power and authority to enter into reciprocal insurance contract

(a)
Persons of this state may enter into reciprocal insurance contracts with each other and with persons of other states and countries, providing indemnity among themselves from any loss that may be insured against under other laws, excepting life insurance.
(b)
For any corporation now existing or hereafter organized under the laws of this state, the power and authority to enter into reciprocal insurance contracts shall be in addition to the powers conferred upon it in its certificate of incorporation, and shall be incidental to the purposes for which the corporation is organized.
Acts 1990, ch. 728, § 2; T.C.A. §
56-16-205
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-106 - Business name - Requirements

Every reciprocal shall have and use a business name that includes the word "reciprocal," "interinsurer," "interinsurance," "exchange," "underwriters" or "underwriting."
Acts 1990, ch. 728, § 2; T.C.A. §
56-16-206
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-107 - License required

No reciprocal shall engage in any insurance transaction in this state until it has obtained a license to do so in accordance with the applicable provisions of chapter 2, part 1 of this title.
Acts 1990, ch. 728, § 2; T.C.A. §
56-16-207
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-108 - Foreign reciprocals - Licensing requirements

No foreign reciprocal shall be licensed to transact the business of insurance in this state unless it has filed with the department a certificate of the supervising insurance official of the state in which it is organized. The certificate shall show that the foreign reciprocal is licensed to write and is writing actively in that state the class of insurance it proposes to write in this state.
Acts 1990, ch. 728, § 2; T.C.A. §
56-16-208
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-109 - Attorney for foreign reciprocal - Residence and principal office

Nothing in this title regarding the admission and licensing of foreign and alien insurers requires that the attorney of a foreign or alien reciprocal be a resident or domiciled in this state, or that the principal office of the attorney be maintained in this state. The office or offices of the attorney shall be determined by the subscribers through the power of attorney.
Acts 1990, ch. 728, § 2; T.C.A. §
56-16-209
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-110 - Attorney for foreign reciprocal - Execution of contracts

Reciprocal insurance contracts shall be executed by the attorney of the reciprocal.
Acts 1990, ch. 728, § 2; T.C.A. §
56-16-210
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-111 - Agent for reciprocal - License required - Appointment

No person shall act in this state as an agent of a reciprocal in the solicitation or procurement of applications for insurance, subscriber's agreements and powers of attorney, or in the collection of premiums in connection with the reciprocal insurer, without first procuring a license from the department pursuant to the requirements in chapter 6 of this title. An agent shall be appointed by each reciprocal the agent represents.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-211.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-112 - Contingent assessment liability of subscriber

(a)
Each subscriber insured under an assessable policy shall have a contingent assessment liability for payment of actual losses and expenses incurred while the subscriber's policy was in force. This shall be in the amount provided for in the power of attorney or subscriber's agreement.
(b)
The contingent assessment liability on any one (1) policy in any one (1) calendar year shall equal the premiums earned on the policy for that year multiplied by not less than one (1) nor more than ten (10).
(c)
The contingent assessment liability shall not be joint, but shall be individual and several.
(d)
Each assessable policy issued by the insurer shall plainly set forth a statement of the contingent assessment liability on the front of the policy in capital letters in no less than ten-point type.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-212.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-113 - Reduction or omission of contingent assessment liability - Requirements - Revocation

(a)
The department may issue a certificate authorizing the reciprocal to reduce or extinguish the contingent assessment liability of subscribers under its policies then in force in this state, and to omit provisions imposing contingent assessment liability in all policies delivered or issued for delivery in this state for as long as the two million dollar ($2,000,000) surplus requirement of this chapter remains unimpaired. The certificate shall be issued if:
(1)
A reciprocal has surplus to policyholders of at least two million dollars ($2,000,000); and
(2)
An application of the attorney for extinguishment has been approved by the board of directors.
(b)
Upon impairment of the surplus to policyholders, the department shall revoke the certificate. After revocation, the reciprocal shall not issue or renew any policy without providing for the contingent assessment liability of subscribers.
(c)
The department shall not authorize a domestic reciprocal to extinguish the contingent assessment liability of any of its subscribers or in any of its policies to be issued, unless it has the required surplus to policyholders and extinguishes the contingent assessment liability of all of its subscribers and in all policies to be issued for all classes of insurance written by it. However, if required by the laws of another state in which the domestic reciprocal is transacting the business of insurance as a licensed insurer, it may issue policies providing for the contingent assessment liability of its subscribers acquiring policies in that state and need not extinguish the contingent assessment liability applicable to policies already in force in that state.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-213.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-114 - Return of savings or credits to subscribers - Distribution

A reciprocal may return to its present or past subscribers, or both, any savings or credits accruing to their accounts. The distribution shall not unfairly discriminate between classes of risks or policies, or between subscribers. However, the distribution may vary for classes of subscribers based upon the experience of those classes.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-214.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-115 - Maintenance of reserves - Requirements

Each reciprocal shall maintain the same unearned premium and loss or claim reserves required for stock and mutual companies writing the same classes of insurance.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-215.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-116 - Consent to service of process

(a)
(1)
Each attorney of a domestic reciprocal who files the declaration required by §
56-16-201
, and each attorney of a foreign or alien reciprocal who applies for a license to transact the business of insurance in this state, shall file with the department a written power of attorney executed by the attorney appointing the commissioner as agent of the reciprocal.
(2)
Upon the appointment, the commissioner:
(A)
May be served all lawful process against or notice to the reciprocal; and
(B)
Shall be authorized to enter an appearance on behalf of the reciprocal.
(3)
A copy of the power of attorney, duly certified by the department, shall be received in evidence in all courts of this state.
(b)
Whenever process or notice is served upon the commissioner, a copy of the process or notice shall be mailed to the attorney at the address shown on the power of attorney. Nothing in this section shall limit the right to serve any process or notice upon any reciprocal in any other manner permitted by law.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-216.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-117 - Action by or against reciprocal - Venue - Service of process

(a)
Any reciprocal doing business in this state may sue or be sued in the name or designation under which its insurance contracts are effected.
(b)
(1)
Any action or suit against a reciprocal may be brought in any county where:
(A)
Its principal office is located; or
(B)
The cause of action or any part of the cause of action arose.
(2)
If the action or suit is to recover a loss under a policy of insurance, it may also be brought in the county where the property insured was situated at the date of the policy.
(3)
Any action or suit against a foreign or alien reciprocal may also be brought in any county of this state in which it has any debts owed to it.
(c)
In an action or suit against a reciprocal, process against or notice to the reciprocal may be served upon the commissioner.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-217.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-118 - Judgment against reciprocal - Effect

Any judgment against a reciprocal based upon legal process duly served as provided in this chapter shall be binding upon the reciprocal and upon each of the reciprocal's subscribers as their respective interests may appear, in an amount not exceeding their respective contingent assessment liabilities.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-218.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 1 - EXCHANGE OR RECIPROCAL INSURANCE (§§ 56-16-101 — 56-16-119) › Section 56-16-119 - Service on board of directors by persons who perform legal or professional service

Section
56-3-103
shall not bar a person who performs legal or other professional services for a reciprocal from serving as a member of the board of directors, or committee of the board, or as an officer of the reciprocal because the person receives payment for legal or other professional services rendered to the reciprocal.
Acts 1997, ch. 58, § 1; T.C.A. §
56-16-210
.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-201 - Statements of subscribers - Filing - Contents

Subscribers contracting among themselves pursuant to part 1 of this chapter shall, through their attorney, file with the commissioner a declaration verified by the oath of the attorney, setting forth:
(1)
The name or title of the office at which the subscribers propose to exchange the indemnity contracts. The name or title shall not be so similar to any other name or title previously adopted by a similar organization, or by any insurance corporation or association as in the opinion of the commissioner is calculated to result in confusion or deception. The office or offices through which the indemnity contracts shall be exchanged shall be classified as reciprocal or interinsurance exchanges;
(2)
The kind or kinds of insurance to be effected or exchanged;
(3)
A copy of the form of policy contract or agreement under or by which the insurance is to be effected or exchanged;
(4)
A copy of the form of the subscriber's agreement and power of attorney or other authority of the attorney under which the insurance is to be effected or exchanged;
(5)
The location of the office or offices from which the contracts or agreements are to be issued;
(6)
That applications have been made for indemnity upon at least twenty-five (25) separate risks aggregating not less than one million five hundred thousand dollars ($1,500,000) as represented by executed contracts or bona fide applications to become concurrently effective, or, in the case of liability or compensation insurance, covering a total payroll of not less than one million five hundred thousand dollars ($1,500,000); and
(7)
That there is on deposit with the attorney and available for the payment of losses a sum of not less than twenty-five thousand dollars ($25,000).
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-301.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-202 - Deposit to be maintained - Required amount

The attorney shall maintain on deposit with the department an equal amount in cash or in value of securities as required by §
56-2-104(a)(4)
.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-302.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-203 - Board of directors - Selection - Powers

The board of directors exercising the subscribers' rights in a domestic reciprocal shall be selected under rules adopted by the subscribers. At least three fourths (3/4) of the board shall be composed of subscribers other than the attorney or any person employed by, representing or having a financial interest in the attorney. The board shall supervise the finances of the reciprocal and the reciprocal's operations to the extent required to assure their conformity with the subscriber's agreement and power of attorney and shall exercise any other powers conferred on it by the subscriber's agreement.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-303.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-204 - Subscriber's agreement and power of attorney - Power to modify - Contents

(a)
Every subscriber of a domestic reciprocal may execute a subscriber's agreement and power of attorney setting forth the rights, privileges and obligations of the subscriber as an underwriter and as a policyholder, and the powers and duties of the attorney. If the reciprocal does not require execution of a subscriber's agreement and power of attorney, the reciprocal shall include on its policies a statement that the subscriber shall be bound by the terms and conditions of the then current subscriber's agreement and power of attorney on file with the attorney and the department, and each subscriber shall by operation of law be bound by the subscriber's agreement and power of attorney as if individually executed. Without additional execution, notice or acceptance, every subscriber of a domestic reciprocal agrees to be bound by any modification of the terms of the power of attorney and subscriber's agreement that is jointly made by the attorney and the board of directors pursuant to §
56-16-205
. The subscriber's agreement and power of attorney shall contain in substance the following:
(1)
A designation and appointment of the attorney to act for and bind the subscriber in all transactions relating to or arising out of the operations of the reciprocal;
(2)
A provision empowering the attorney to:
(A)
Accept service of process on behalf of the reciprocal; and
(B)
Appoint the commissioner agent of the reciprocal upon whom may be served all lawful process against or notice to the reciprocal;
(3)
Except for nonassessable policies, a provision for a contingent assessment liability of each subscriber in a specified amount in accordance with §
56-16-112
; and
(4)
The maximum amount to be deducted from advance premiums or deposits to be paid the attorney, and the items of expense, in addition to losses, to be paid by the reciprocal.
(b)
The subscriber's agreement may:
(1)
Provide for the right of substitution of the attorney and revocation of the power of attorney;
(2)
Impose any restrictions upon the exercise of the power agreed upon by the subscribers;
(3)
Provide for the exercise of any right reserved to the subscribers directly or through the board of directors; or
(4)
Contain other lawful provisions considered advisable.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-304.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-205 - Subscriber's agreement and power of attorney - Modification

Modification of the terms of the power of attorney and subscriber's agreement of a domestic reciprocal shall be made jointly by the attorney and the board of directors. The modification shall be filed with the attorney and the department, and the filing shall by operation of law bind all subscribers the same as if each subscriber individually adopted and executed the modified, altered or amended subscriber's agreement and power of attorney. No modification shall be effective retroactively, nor shall it affect any insurance contract issued prior to the modification.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-305.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-206 - Advancement of funds for operation

The attorney or other interested persons may advance to a domestic reciprocal any funds required in its operations. The funds advanced shall not be treated as a liability of the reciprocal and shall not be withdrawn or repaid except out of the reciprocal's earned surplus in excess of its minimum required surplus.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-306.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-207 - Assessments - Power to levy - Computation

(a)
Assessments may be levied upon the subscribers of a domestic reciprocal by the attorney in accordance with §
56-16-112
. The assessments shall be approved in advance by the board of directors and the department.
(b)
Each domestic reciprocal subscriber's share of a deficiency for which an assessment is made shall be computed by multiplying the premiums earned on the subscriber's policies during the period to be covered by the assessment by the ratio of the total deficiency to the total premiums earned during the period upon all policies subject to the assessment. However, no assessment shall exceed the aggregate contingent assessment liability computed in accordance with §
56-16-112
. For the purposes of this section, the premiums earned on the subscriber's policies are the gross premiums charged by the reciprocal for the policies, minus any charges not recurring upon the renewal or extension of the policies. No subscriber shall have an offset against any assessment for which the subscriber is liable on account of any claim for unearned premium or losses payable.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-307.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-208 - Assessments - Time limit for paying

Every subscriber of a domestic reciprocal having contingent assessment liability shall be liable for and shall pay the subscriber's share of any assessment computed in accordance with §
56-16-207
if, while the policy is in force or within one (1) year after its termination, the subscriber is notified:
(1)
By the attorney of the attorney's intention to levy the assessment; or
(2)
That delinquency proceedings have been commenced against the reciprocal under chapter 9 of this title, and the department or receiver intends to levy an assessment.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-308.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-209 - Liquidation - Distribution of assets

Upon the liquidation of a domestic reciprocal, its assets shall be distributed pursuant to chapter 9 of this title.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-309.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 16 - EXCHANGE OR RECIPROCAL INSURANCE ACT OF 1990 (§§ 56-16-101 — 56-16-210) › Part 2 - DOMESTIC RECIPROCALS (§§ 56-16-201 — 56-16-210) › Section 56-16-210 - Assets insufficient to settle liabilities - Levy of assessment on subscribers - Delinquency proceedings

(a)
(1)
The domestic reciprocal's attorney shall levy an assessment upon subscribers made subject to assessment by the terms of their policies for the amount needed to make up the deficiency, if:
(A)
The assets of a domestic reciprocal are at any time insufficient to settle the sum of its liabilities, except those on account of funds contributed by the attorney or other parties, and its required surplus to policyholders; and
(B)
The deficiency is not cured from other sources;
(2)
However, the assessment shall be subject to §
56-16-112
.
(b)
If the attorney fails to make the assessment within thirty (30) days after the department orders it to do so, or if the deficiency is not fully made up within sixty (60) days after the date the assessment was made, delinquency proceedings may be instituted and conducted against the insurer as provided in chapter 9 of this title.
(c)
If liquidation of the reciprocal is ordered, an assessment shall be levied upon the subscribers for the amount the department or the court, as the case may be, determines to be necessary to discharge all liabilities of the reciprocal. This assessment shall exclude any funds contributed by the attorney or other persons, but shall include the reasonable cost of the liquidation. However, the assessment shall be subject to §
56-16-112
.
Acts 1990, ch. 728, § 2; T.C.A. § 56-16-310.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 17 - DISCOUNT PLANS (§§ 56-17-101 — 56-17-106) › Section 56-17-101 - Chapter definitions

As used in this chapter:
(1)
"Commissioner" means the commissioner of commerce and insurance;
(2)
"Department" means the department of commerce and insurance;
(3)
"Discount plan":
(A)
Means a card, or other purchasing mechanism or device, that is not insurance and purports to offer discounts or access to discounts to a member for dental services, vision services, or retail purchases of prescription drugs from licensed pharmacies; and
(B)
Does not include:
(i)
A discount card or drug benefit plan provided by a self-insured employer's group health benefits plan;
(ii)
A discount plan offered by an insurer licensed under this title in conjunction with health insurance;
(iii)
A dental service plan regulated by the Dental Service Plan Law, 1961, compiled in chapter 30 of this title; or
(iv)
A vision service plan regulated by the Vision Service Plan Law, compiled in chapter 31 of this title;
(4)
"Marketer" means a person or entity that offers, sells, markets, advertises, or otherwise distributes a discount plan, including a private label entity that places its name on, and markets or distributes, a discount plan pursuant to a marketing agreement with a discount plan operator;
(5)
"Member" means an individual who pays fees, dues, charges, or other consideration for the right to enroll to receive the purported benefits of a discount plan;
(6)
"Operator":
(A)
Means a person that engages as principal in the business of offering, selling, marketing, advertising, or otherwise distributing a discount plan within this state; and
(B)
Does not include discount cards offered by a nonprofit association to its members as an incidental benefit to membership in the association as long as that membership in the association entitles members to apply for insurance or other health benefits that are available only to members of the association;
(7)
"Person" means an individual, corporation, partnership, association, joint venture, joint stock company, trust, unincorporated organization, limited liability company, similar entity, or combination of these entities; and
(8)
"Prescription drug" has the same meaning as defined in §
63-10-204
.
Added by 2021 Tenn. Acts, ch. 372, s 1, eff. 7/1/2021.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 17 - DISCOUNT PLANS (§§ 56-17-101 — 56-17-106) › Section 56-17-102 - Certificate of registration required by operator of discount plan - Application

(a)
An operator of a discount plan must obtain a valid certificate of registration from the commissioner. A certificate of registration is not required for a marketer. A certificate of registration is valid for one (1) year from the date of issuance. In order to receive a valid certificate of registration, an operator must file an application on a form adopted by the commissioner and provide, or demonstrate, to the commissioner the following:
(1)
The name and principal place of business of the operator; and
(2)
The name and address of the agent in this state for service of process.
(b)
Notwithstanding any law to the contrary, it is a violation of this chapter for an operator, on or after August 1, 2022, to sell, market, promote, advertise, or otherwise distribute a discount plan in this state without first complying with the registration provisions of this chapter and complying with §§
47-18-2701
and
47-18-2702
.
Added by 2021 Tenn. Acts, ch. 372, s 1, eff. 7/1/2021.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 17 - DISCOUNT PLANS (§§ 56-17-101 — 56-17-106) › Section 56-17-103 - Information required to be provided to members

(a)
A discount card or materials distributed on behalf of a discount plan covered under this chapter must expressly provide, in bold and reasonably prominent type, that the card or plan does not constitute insurance. The card or distributed materials must also contain a toll-free number for customer service and provide the operator's corporate name and a website address, if applicable.
(b)
The operator must provide a prospective member, prior to becoming a member, with a complete description of the fees that a member of the plan could be assessed, including one-time non-refundable processing fees, upfront fees, or membership fees associated with the plan, along with the estimated average savings typically associated with the plan's general terms and conditions.
(c)
An operator must provide a member with:
(1)
An annually updated network directory of participating pharmacies, dentists, and vision care providers or access to the information online or by a toll-free number;
(2)
An annually updated list of the prescription drugs covered by the card or plan or access to the information online, by a toll-free number, or by way of a notation that the plan is an open formulary; and
(3)
A toll-free number for customer service.
Added by 2021 Tenn. Acts, ch. 372, s 1, eff. 7/1/2021.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 17 - DISCOUNT PLANS (§§ 56-17-101 — 56-17-106) › Section 56-17-104 - Cancellation by members

(a)
A member has the right to cancel membership in a plan within thirty (30) days of joining the plan and has the right to have refunded membership fees paid during that initial membership, except for a one-time nominal processing fee.
(b)
After the initial thirty-day membership period, a member has the right to cancel membership, in accordance with the policies established by the operator. An operator must provide information concerning the cancellation policy to the member at the time of the initial membership and cannot change the cancellation policy unless the operator provides the member with written notice at least thirty (30) days prior to the date the change takes effect.
Acts 2021, ch. 372, § 1.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 17 - DISCOUNT PLANS (§§ 56-17-101 — 56-17-106) › Section 56-17-105 - Additional consumer protections

(a)
An operator or marketer shall not:
(1)
Describe or characterize the discount plan as being insurance;
(2)
Use or approve for use in its cards or distributed materials the terms "health plan," "coverage," "copay," "copayments," "deductible," "preexisting conditions," "guaranteed issue," "premium," "PPO," "preferred provider organization," or other terms in a manner that could reasonably mislead an individual into believing that the discount plan is health insurance;
(3)
Make misleading, deceptive, or fraudulent representations regarding the discount or range of discounts offered by the discount plan; or
(4)
Pay pharmacies, dentists, or vision care providers fees for healthcare services or collect or accept money from a member to pay a pharmacy, dentist, or vision care provider for healthcare services provided under the discount plan, unless the operator or marketer has an active certificate of authority to act as a third-party administrator.
(b)
An operator shall approve in writing, prior to the marketer's use, all cards and distributed materials used by marketers to offer, sell, market, advertise, or otherwise distribute the discount plan.
Acts 2021, ch. 372, § 1.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 17 - DISCOUNT PLANS (§§ 56-17-101 — 56-17-106) › Section 56-17-106 - Violations - Penalties

(a)
As part of an examination or investigation, the commissioner may request, and the operator or marketer shall provide, copies of materials that are distributed to prospective members.
(b)
After notice and hearing, the commissioner may levy an administrative penalty, in an amount up to ten thousand dollars ($10,000), for each violation of this chapter. Each day of a continuing violation constitutes a separate violation for purposes of this chapter.
Acts 2021, ch. 372, § 1.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-101 - Mutual associations - Insuring members

Any company may restrict its business to the insurance of the lives of its members or stockholders alone, it being the intent of this section to permit of a corporate existence to any professional association, guild, brotherhood or other mutual association, the right, by an arrangement among themselves, as stockholders in a corporation, to insure the lives of each other upon the principle of the mutual participation in the profits, by annual subscriptions, or otherwise, and thereby provide a fund out of which provision may be made, according to the bylaws of the corporation, for the support of the family of any stockholder on the stockholder's death, or for the payment of any policy due the stockholder's estate on the stockholder's death. In case the corporation restricts its business to the insurance of the lives of stockholders, no publication need be made annually of its debt and liabilities.
Acts 1875, ch. 142, § 10; Shan., § 2269; mod. Code 1932, § 3980; modified; T.C.A. (orig. ed.), § 56-1601.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-102 - Minimum capital requirements

(a)
A domestic mutual life insurance company operating under this chapter shall not receive an original or renewal certificate of authority from the commissioner to issue policies or contracts of insurance unless it possesses and maintains capital or surplus funds as required by §
56-2-114
.
(b)
Subsection (a) does not apply to any insurance company chartered prior to March 15, 1976.
Acts 1949, ch. 91, § 14; C. Supp. 1950, § 6433.26 (Williams, § 6433.30); Acts 1976, ch. 413, §§ 1, 3; T.C.A. (orig. ed.), § 56-1602.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-103 - Board of directors - Powers - Qualifications

The corporate powers of a mutual life insurance corporation shall be exercised by, and its business and affairs shall be under the control and government of, a board of directors composed of not less than fifteen (15) nor more than twenty-one (21) natural persons who are policyholders and who are at least eighteen (18) years of age, and at least seven (7) of whom are residents and citizens of this state.
Acts 1949, ch. 91, § 8; C. Supp. 1950, § 6433.20 (Williams, § 6433.24); impl. am. Acts 1971, ch. 162, § 3; T.C.A. (orig. ed.), § 56-1604.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-104 - Division of board of directors - Classification - Terms

In order to secure continuity of membership in its board of directors, the bylaws of the corporation may provide for division of the board into no more than seven (7) classes as nearly equal in number as possible, and may fix the term of office for each class. Unless such provision is made in the bylaws, all directors shall be elected annually.
Acts 1949, ch. 91, § 9; C. Supp. 1950, § 6433.21 (Williams, § 6433.25); T.C.A. (orig. ed.), § 56-1605.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-105 - Election of directors - Annual meeting

(a)
(1)
All directors, as provided in §
56-18-104
, shall be elected at an annual meeting of the policyholders of the company, and other questions at the meeting shall be determined, in the manner and subject to the regulations prescribed.
(2)
(A)
For the purposes of the meeting or election, "policyholder" means:
(i)
A person insured by the corporation under an individual life insurance policy or pure endowment contract;
(ii)
A person to whom the corporation has issued an individual annuity contract, or a policy of noncancelable and guaranteed renewable accident and health insurance; or
(iii)
Any employer, including the mutualized corporation itself, or other person, firm, corporation or association, some or all of whose employees or members are covered by the corporation with a group life insurance plan or contract or with a group annuity plan or contract;
(B)
In all cases, the person shall be qualified as a policyholder under this section only so long as the policy or contract so qualifying the person remains in full force other than as reduced paid-up insurance or extended insurance on the date of the meeting or election, and shall have been so in full force for at least one (1) year prior to that date; and
(C)
Every policyholder shall be entitled to one (1) vote, or to a number of votes based upon the insurance in force, the number of policies held, or the amount of premiums paid, as may be provided in the bylaws.
(b)
Any vacancy occurring on the board of directors may be filled by a majority vote of the board for the unexpired term to which the vacancy relates.
Acts 1949, ch. 91, § 10; C. Supp. 1950, § 6433.22 (Williams, § 6433.26); T.C.A. (orig. ed.), § 56-1606.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-106 - Annual meeting - Notice - Voting by proxy

(a)
Policyholders, as defined in §
56-18-105
, shall be notified of the annual meetings or elections:
(1)
By written notice;
(2)
By an imprint upon the filing backs of their policies;
(3)
In case of policies on which the premiums are payable monthly or more often, on some other prominent place of each policy; or
(4)
Upon receipts or certificates of renewal.
(b)
The annual meetings or elections shall be held and conducted in accordance with rules prescribed in the bylaws of the corporation adopted by its board of directors and approved by the commissioner.
(c)
Policyholders may vote in person, or by proxies dated and executed within three (3) months of, and returned and recorded on the books of the company thirty (30) days or more before, the meeting at which they are to be used. No person shall, as attorney or otherwise, cast more than twenty (20) votes other than those to which the person is entitled as a policyholder, except that the secretary of the corporation may cast as many votes as are possessed by policyholders sending the secretary their proxies, but the secretary shall not solicit any proxy vote, nor shall any other officer, employee or agent of the corporation personally, or by another person or organization, ask for, receive, procure to be obtained or use a proxy vote.
Acts 1949, ch. 91, § 11; C. Supp. 1950, § 6433.23 (Williams, § 6433.27); T.C.A. (orig. ed.), § 56-1607.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-107 - Voting false proxy - Penalty

An officer, employee or agent of the corporation who asks for, receives, procures to be obtained or uses a proxy vote in violation of §
56-18-106
shall be punished by a fine of not less than one hundred dollars ($100), nor more than three hundred dollars ($300), and any proxy vote so obtained shall be null and void.
Acts 1949, ch. 91, § 12; C. Supp. 1950, § 6433.24 (Williams, § 6433.28); T.C.A. (orig. ed.), § 56-1608.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-109 - Plan of mutualization

The plan of mutualization, if properly approved as provided in §
56-18-108
, may contain any provision or provisions not in conflict with this chapter or the constitution or other statutory laws of the state.
Acts 1949, ch. 91, § 15; C. Supp. 1950, § 6433.27 (Williams, § 6433.31); T.C.A. (orig. ed.), § 56-1610.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-110 - Policyholders' meeting to consider plan for conversion into mutual company

(a)
If a plan of mutualization has been adopted by a vote of a majority of the directors of the corporation, approved by the commissioner, and approved by a vote of stockholders representing a majority of the capital stock then outstanding, a written notice of the meeting of policyholders to consider the plan shall be given by mailing the notice from the home office of the company to each policyholder holding a single policy in the amount of one thousand dollars ($1,000) or more at least thirty (30) days prior to the meeting in a sealed envelope, postage prepaid, addressed to the policyholder at the policyholder's last known post office address, and by a newspaper advertisement published at least thirty (30) days prior to the meeting, and not more than sixty (60) days prior to the meeting, in one (1) newspaper published in the capital city of each state in which the company is qualified to transact business.
(b)
A policyholder eligible to vote at the meeting is any policyholder who holds life insurance in the company in a total amount at least equal to one thousand dollars ($1,000), or a policy of noncancellable and guaranteed renewable accident and health insurance with an annual premium of one hundred dollars ($100) or more. The reference in this subdivision (b) to insurance in the amount of one thousand dollars ($1,000) or more includes any policy or policies with a total face or principal sum amount of one thousand dollars ($1,000) or more, any annuity contract or contract that at normal date of maturity requires the payment of a total of one hundred dollars ($100) or more annually, and any pure endowment contract or contracts for the total principal sum of one thousand dollars ($1,000) or more; provided, that the policy or policies or contracts have been in force, other than as reduced paid-up insurance or extended insurance, for at least one (1) year immediately preceding the meeting.
(c)
Each policyholder shall be entitled to one (1) vote at the policyholders' meeting, regardless of the number of policies or contracts held or their amounts.
Acts 1949, ch. 91, § 2; C. Supp. 1950, § 6433.14 (Williams, § 6433.17); impl. am. Acts 1971, ch. 137, § 2; T.C.A. (orig. ed.), § 56-1611.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-111 - Procedure at policyholders' meeting to consider conversion - Payment for shares by corporation

(a)
The policyholders' meeting for the purpose of voting on the plan of mutualization shall be conducted in the manner provided in the mutualization plan; provided, that policyholders may vote in person, by proxy, or by mail and all votes shall be cast by ballot on a uniform ballot furnished by the corporation. The commissioner shall appoint no fewer than three (3) nor more than five (5) inspectors who shall observe the voting at the meeting and report to the commissioner as to the procedures employed at the meeting to verify the ballots, to ascertain their validity, and to establish the qualification of the voters. The inspectors shall canvass the vote in the presence of at least two (2) representatives named by the corporation, and shall certify to the commissioner and to the corporation the result of the vote. All necessary actual expenses, including reasonable per diem for the inspectors, incurred by the inspectors in performing the services, shall be paid by the corporation upon the certificate of the commissioner.
(b)
Every payment for the acquisition of any shares of the capital stock of the corporation, the purchase price of which is not fixed by the plan, shall be subject to the approval of the commissioner. Neither the plan, nor any payment, shall be approved by the commissioner, unless at the time of the approvals, respectively, the corporation, after deducting the aggregate sum appropriated by the plan for the acquisition of any part or all of its capital stock, and in the case of any payment not fixed by the plan and subject to separate approval after the approval of the plan, after deducting also the amount of the payment, shall be possessed of assets sufficient to maintain its deposit theretofore made with the commissioner, and not less than the liabilities of the corporation required by law, including the net values of its outstanding contracts computed according to the standard adopted by the corporation under the applicable statutes of this state.
Acts 1949, ch. 91, § 3; C. Supp. 1950, § 6433.15 (Williams, §§ 6433.18, 6433.19); T.C.A. (orig. ed.), § 56-1612.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-112 - Acquisition of stock by corporation in carrying out plan of conversion - Voting of stock

(a)
(1)
If a stock life insurance corporation determines to become a mutual life insurance corporation, it may, in carrying out any plan to that end under this chapter, acquire any shares of its own stock by gift, bequest or purchase.
(2)
Until all of the shares are acquired, any shares so acquired shall be assigned and transferred on the books of the corporation to five (5) trustees for the corporation, and shall be held by them in trust and be voted as a unit by them at all corporate meetings at which stockholders have a right to vote, until all of the capital stock of the corporation is acquired, when the entire capital stock shall be retired and cancelled and, thereupon, the corporation shall be made and become a mutual life insurance corporation without capital stock.
(3)
Before undertaking any of the duties of appointment, each trustee shall file with the company a verified acceptance of the appointment and a declaration that the trustee will faithfully discharge all duties as trustee, and shall give bond as required by the mutualization plan.
(4)
All dividends and other sums received by the trustees on the shares of stock so acquired by them, shall, after paying the necessary expenses of executing the trust, be added to and become a part of the surplus earned by the company.
(b)
The five (5) trustees shall be named in the plan of mutualization originally adopted by the directors of the corporation, and shall be approved by the commissioner. The plan of mutualization shall also provide for the method of filling vacancies occurring among the trustees.
Acts 1949, ch. 91, § 4; C. Supp. 1950, § 6433.16 (Williams, § 6433.20); impl. am. Acts 1971, ch. 137, § 2; T.C.A. (orig. ed.), § 56-1613.
2023 Tennessee Code › Title 56 - INSURANCE (§§ 56-1-101 — 56-61-125) › Chapter 18 - MUTUAL LIFE INSURANCE COMPANIES (§§ 56-18-101 — 56-18-116) › Section 56-18-113 - Officers of stock corporation become officers of new mutual corporation

When a stock life insurance corporation has become converted into a mutual life insurance corporation as provided in this chapter, the officers and directors shall remain as the officers and directors of the newly converted corporation until the next annual meeting for the election of officers and directors when their successors shall be elected in the manner provided for in this chapter and in the bylaws of the corporation.
Acts 1949, ch. 91, § 7; C. Supp. 1950, § 6433.19 (Williams, § 6433.23); T.C.A. (orig. ed.), § 56-1614.