Vermont § 3421 - Mutualization of stock insurer

§ 3421. Mutualization of stock insurer

• (a) A domestic stock insurer may become a mutual insurer under such plan and procedure
  as may be approved by the Commissioner after a hearing held substantially in accordance
  with the provisions of section 3305 of this title. (b) The Commissioner shall not approve any such plan or mutualization unless: (1) It is equitable to its stockholders and policyholders. (2) It is subject to approval by the holders of not less than a majority of the insurer’s
  outstanding capital stock having voting rights present at a duly called regular or
  special meeting thereof, and by not less than a majority of the insurer’s policyholders
  who vote on such plan in person, by proxy or by mail pursuant to such notice and procedure
  as may be approved by the Commissioner. (3) If a life insurer, the right to vote thereon is limited to holders of policies other
  than term or group policies, and whose policies have been in force for more than one
  year. (4) Mutualization will result in retirement of shares of the insurer’s capital stock at
  a price not in excess of the fair market value thereof as determined by competent
  disinterested appraisers. (5) The plan provides for the purchase of the shares of any nonconsenting stockholder
  in substantially the same manner and subject to the same rights and conditions as
  are accorded a dissenting shareholder under section 3428 of this title. (6) The plan provides for definite conditions to be fulfilled by a designated early date
  upon which such mutualization will be deemed effective and for notices substantially
  in accordance with section 3424 of this title. (7) The mutualization leaves the insurer with surplus funds reasonably adequate for the
  security of its policyholders and to enable it to continue successfully in business
  in states in which it is then authorized to transact business, and for the kinds of
  insurance included in its certificates of authority in such states. (c) No director, officer, agent, or employee of the insurer, nor any other person, shall
  receive any fee, commission, or other valuable consideration whatsoever for in any
  manner aiding, promoting, or assisting therein except as set forth in the plan of
  mutualization as approved by the Commissioner. (d) This section shall not apply to mutualization under order of court pursuant to rehabilitation
  or reorganization of an insurer. (Added 1967, No. 344 (Adj. Sess.), § 1 (ch. 1, subch. 4, § 1).)