Bill > SB2185

This bill declares that it is in the public interest for mutual insurance company policyholders to be treated fairly during any transition to a mutual insurance holding company, which is a type of corporate structure where a mutual insurance company is owned by a holding company. The bill affirms that money and assets of mutual insurance companies established by statute with legislative funding are held in trust for policyholders and that such companies, like CompSource Mutual Insurance Company, cannot become stock insurance companies. Furthermore, these companies are prohibited from transitioning to a mutual insurance holding company unless they first pay all policyholders from January 1, 2000, to the present their "fair and equitable" ownership interest, meaning a just and honest distribution of assets, and the "fair market value" of their policy interest, which is the true economic worth in a normal transaction. If a court finds a company is already in the process of "demutualization" (changing from a mutual company to a stock company), it can only change its corporate structure to a mutual insurance holding company as authorized by this act, and no other means of changing its structure are permitted. The bill also includes an emergency clause, meaning it will take effect immediately upon passage and approval to preserve public peace, health, or safety.