Chapter 644

CHAPTER 644

DOMESTIC MUTUAL INSURANCE HOLDING COMPANIES

SUBCHAPTER I

GENERAL PROVISIONS

644.02   Definitions.

644.03   Scope and purposes.

644.04   Restructuring.

644.05   General corporate powers and procedures.

644.06   Registered agent for service of process.

SUBCHAPTER II

MUTUAL INSURANCE HOLDING COMPANIES

644.07   Restructuring procedures.

644.08   Reservation of corporate name.

644.09   Articles, amendments, bylaws and principal officers.

644.10   Acquisition, merger or consolidation as part of the plan.

644.11   Restructuring of domestic or foreign mutual with existing domestic mutual holding company.

644.12   Transfers of a mutual holding company’s place of domicile to this state.

644.13   Restrictions on ownership.

644.14   Member rights.

644.15   Sale of voting stock; subscription rights; dividends.

644.16   Board of directors, committees and records.

644.17   Removal of officers.

644.18   Directors’ and officers’ liability and indemnification.

644.19   Executive compensation.

644.20   Management contract services.

644.21   Annual report of domestic mutual holding company.

644.22   Securities regulation.

644.23   Authority to issue mutual bonds and contribution notes.

644.24   Subsequent restructuring.

644.25   Conversion of domestic mutual holding company into a stock corporation.

644.26   Transfer of business or assets of mutual holding companies.

644.27   Merger and consolidation of mutual holding companies.

644.28   Voluntary dissolution of domestic mutual holding companies.

644.29   Involuntary dissolution of domestic mutual holding companies.

Ch. 644 Cross-reference Cross-reference: See definitions in ss. 600.03, 610.01 and 628.02.

Ch. 644 Cross-reference Cross-reference: See also ch. Ins 40, Wis. adm. code.

subch. I of ch. 644 SUBCHAPTER I

GENERAL PROVISIONS

644.02 644.02 Definitions.

644.02(1) (1) In this chapter, unless the context otherwise requires:

644.02(1)(a) (a) “Board” means the board of directors or board of trustees, as the case may be, of the converting insurance company.

644.02(1)(b) (b) “Converted insurance company” means an insurance company that converted under this chapter from a mutual insurance company to a stock insurance company, or from a service insurance corporation to a mutual insurance company and then to a stock insurance company, and formed a mutual holding company.

644.02(1)(c) (c) “Converted life insurance company” means a life insurance company that converted under this chapter from a mutual life insurance company to a stock insurance company and formed a mutual holding company.

644.02(1)(d) (d) “Converting insurance company” means a domestic mutual insurance company or a domestic service insurance corporation undergoing restructuring under this chapter.

644.02(1)(e) (e) “Dividend plan” means a plan to provide reasonable assurances as to the policyholder dividend scales of the participating individual policies and contracts of a converted insurance company in the life insurance business in force on the date specified in the dividend plan for which the insurer had an experience-based dividend scale payable in the year of the plan by creating any of the following:

644.02(1)(e)1. 1. Covenants of the converted insurance company or the mutual holding company, or both.

644.02(1)(e)2. 2. One or more closed blocks. Assets of the converted insurance company shall be allocated to the closed block in an amount that produces cash flows, together with anticipated revenues from the closed block business, expected to be sufficient to support the closed block business, including provision for payment of claims and those expenses and taxes specified in the dividend plan, and provision for continuation of the dividend scales in effect on the effective date of the restructuring under this chapter if the experience underlying such dividend scales continues. Any plan under this subdivision may provide for conditions under which the converted insurance company may cease to maintain any closed block and for the allocation of assets to that closed block.

644.02(1)(e)3. 3. A combination of subds. 1. and 2. or any other means of providing reasonable assurances that the commissioner approves.

644.02(1)(f) (f) “Dividend scales” means the equitable apportionment of divisible surplus by the board.

644.02(1)(g) (g) “Divisible surplus” means the annual distribution described in s. 632.62 (4) (b) as a payment made to policyholders as determined by the board.

644.02(1)(h) (h) “Intermediate stock holding company” means a corporation that satisfies all of the following:

644.02(1)(h)1. 1. The corporation was incorporated under ch. 180.

644.02(1)(h)2. 2. At least 51 percent of the corporation’s voting stock is held directly or indirectly by a mutual holding company.

644.02(1)(h)3. 3. The corporation holds directly or indirectly at least 51 percent of the voting stock of a converted insurance company.

644.02(1)(i) (i) “Member” means any of the following:

644.02(1)(i)1. 1. For a converting mutual insurance company, a policyholder who, by the records of the converting insurance company and by its articles of incorporation and bylaws, is a holder of a membership interest in the converting insurance company.

644.02(1)(i)2. 2. For a converting service insurance corporation, a policyholder shown on the books and records of the converting insurance company on the effective date of the restructuring.

644.02(1)(j) (j) “Membership interests” means the voting rights of a member arising under the statutes and the articles of incorporation and bylaws of the converting insurance company, including the right to vote for the board and the right to vote on any plan of conversion, voluntary dissolution or amendment of the articles of incorporation. On and after the effective date of the restructuring, “membership interests” means the voting rights of a member arising under the statutes and the articles of incorporation and bylaws of the mutual holding company, including the right to vote for the board and the right to vote on any plan of conversion, voluntary dissolution or amendment of the articles of incorporation. “Membership interests” does not include members’ rights in surplus, if any.