§236.9.  Effect of reorganization

A.  With respect to the conversion of a mutual insurer, upon the effective date, the mutual insurer shall immediately become a stock insurer, all membership interests shall be extinguished, and the reorganized insurer or its parent corporation will act in good faith to convey consideration to eligible members pursuant to the plan of reorganization.  The reorganized insurer shall be a continuation of the mutual insurer, and the reorganization in no way shall annul, modify, or change any of the mutual insurer's existing suits, rights, contracts, or liabilities, except as provided in the plan of reorganization.  After reorganization, the reorganized insurer shall exercise all the rights and powers and perform all the duties conferred or imposed by law upon insurers writing the classes of insurance written by it, and shall be vested in all the rights, franchises, and interests of the mutual insurer in and to every species of property without any deed or transfer, and the reorganized insurer shall succeed to all the obligations and liabilities of the mutual insurer, and retain all rights and contracts existing prior to conversion, except as provided in the plan of reorganization.

B.  With respect to the conversion of a mutual insurance holding company, upon the effective date, the membership interests of the members of the mutual insurance holding company shall be extinguished, and the reorganized company shall act in good faith to convey consideration to eligible members pursuant to the plan of reorganization.  Each reorganized insurer within the mutual insurance holding company system will continue its corporate existence as a stock insurer within a stock insurance holding company system, and the reorganization shall in no way annul, modify, or change any of such reorganized insurer's existing suits, rights, contracts, or liabilities, except as provided in the plan of reorganization.

Acts 2008, No. 307, §1, eff. June 17, 2008.