Bill > SB982

This bill allows a mutual insurance holding company, which is a nonstock corporation that is the parent of a reorganized stock insurer, to convert its entire system into a mutual insurer, meaning a company owned by its policyholders. This conversion can only happen if a specific plan of conversion is adopted and approved. The plan must ensure that membership interests in the holding company become non-transferable membership interests in the new mutual insurer, future policyholders become members, existing policies remain in effect, shares of the reorganized stock insurer and any intermediate holding companies are retired, the holding companies are dissolved, and the new mutual insurer has sufficient surplus funds to protect its policyholders. The plan also requires approval from the holding company's board of directors and a significant majority (at least 75%) of its members. Before the conversion can take effect, the plan, along with amendments to the reorganized stock insurer's governing documents, a 5-year operational plan, and details about the new insurer's officers and directors, must be submitted to the Maryland Insurance Commissioner for approval at least 60 days in advance. The Commissioner will approve the plan if it complies with the law and is fair to all members and policyholders, and they can impose additional conditions or hire experts to review the plan, with the costs borne by the holding company.

https://mgaleg.maryland.gov/mgawebsite/Legislation/Details/SB0982?ys=2026RS