§ 1401.5
504 words·~2 min read·
/ca/insurance-code/1401-5A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
(a)When the commissioner finds after a public hearing that a reciprocal or interinsurance exchange has at all times during any consecutive five-year period terminating on December 31, 1964, or on the last day of any subsequent calendar year, as shown by its annual statements, as filed or as adjusted by the commissioner, as the case may be, maintained a surplus of admitted assets over all liabilities of at least three million dollars ($3,000,000) the commissioner may make an order that the reciprocal or interinsurance exchange need not obtain the certificate provided in Section 1401 and that its subscribers shall thereafter in perpetuity have no liability for assessment on policies issued or renewed at any time after that order becomes final or may, if the reciprocal desires not to become nonassessable, issue a certificate of capability to reinsure. To request the order, the reciprocal or interinsurance exchange shall file a petition with the commissioner, on a form prescribed by the commissioner. The filing fee for the petition shall be five hundred sixty-seven dollars ($567). The commissioner shall give notice of the hearing in the insurance press and in any other ways as he or she deems advisable and to the extent he or she deems advisable. That order is subject to the provisions of Section 12940 and any person with sufficient relevant interest shall be authorized to bring any permitted action thereunder.
(b)When the order of the commissioner becomes final any domestic reciprocal or interinsurance exchange obtaining that order shall no longer be subject to or entitled to the benefits of: subdivision
(c)of Section 1307, subdivision
(b)of Section 1374, and Article 6 (commencing with Section 1390) of this chapter.
(c)At the time all reciprocal or interinsurance exchanges conducting insurance business in this state are by law governed for all purposes as to required minimum surplus (including that for admission, amendment of certificate of authority, and solvency) by the same standards for minimum paid-in capital and surplus as are then applicable to capital stock insurers, any domestic reciprocal or interinsurance exchange may obtain the order provided in subdivision (a), subject to the provisions in subdivision
(a)by showing that it has maintained the minimum paid-in capital and surplus requirement applicable to capital stock insurers for at least five consecutive years in lieu of the three million dollars ($3,000,000) surplus prescribed in subdivision (a).
(d)If the power of attorney or any policy of any domestic reciprocal or interinsurance exchange obtaining the order provided by subdivision
(a)contains language directly or indirectly creating a liability for assessment, in respect to policies issued prior to or issued after the order becomes final that power of attorney and all those policies shall be deemed in law to have been amended to delete and repeal any and all of those assessment provisions as of the date that the order becomes final without any further action on the part of the reciprocal or interinsurance exchange, its subscribers, its attorney-in-fact, or the body exercising the subscriber’s rights.