Utah Code 31A-5-412. Committees of directors
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Terms Used In Utah Code 31A-5-412
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Amendment: means an endorsement to an insurance policy or certificate. See Utah Code 31A-1-301
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Corporation: means an insurance corporation, except when referring to:(34)(a)(i) a corporation doing business:(34)(a)(i)(A) as:(34)(a)(i)(A)(I) an insurance producer;(34)(a)(i)(A)(II) a surplus lines producer;(34)(a)(i)(A)(III) a limited line producer;(34)(a)(i)(A)(IV) a consultant;(34)(a)(i)(A)(V) a managing general agent;(34)(a)(i)(A)(VI) a reinsurance intermediary;(34)(a)(i)(A)(VII) a third party administrator; or(34)(a)(i)(A)(VIII) an adjuster; and(34)(a)(i)(B) under:(34)(a)(i)(B)(I) Chapter 23a, Insurance Marketing - Licensing Producers, Consultants, and Reinsurance Intermediaries;(34)(a)(i)(B)(II) Chapter 25, Third Party Administrators; or(34)(a)(i)(B)(III) Chapter 26, Insurance Adjusters; or(34)(a)(ii) a noninsurer that is part of a holding company system under Chapter 16, Insurance Holding Companies. See Utah Code 31A-1-301
- Director: means a member of the board of directors of a corporation. See Utah Code 31A-1-301
- Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
- Insurance: includes :
(96)(b)(i) a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;(96)(b)(ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and(96)(b)(iii) a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301- Member: means a person having membership rights in an insurance corporation. See Utah Code 31A-1-301
- Order: means an order of the commissioner. See Utah Code 31A-1-301
- Person: includes :
(146)(a) an individual;(146)(b) a partnership;(146)(c) a corporation;(146)(d) an incorporated or unincorporated association;(146)(e) a joint stock company;(146)(f) a trust;(146)(g) a limited liability company;(146)(h) a reciprocal;(146)(i) a syndicate; or(146)(j) another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301- Policy: includes a service contract issued by:
(150)(b)(i) a motor club under Chapter 11, Motor Clubs;(150)(b)(ii) a service contract provided under Chapter 6a, Service Contracts; and(150)(b)(iii) a corporation licensed under:(150)(b)(iii)(A) Chapter 7, Nonprofit Health Service Insurance Corporations; or(150)(b)(iii)(B) Chapter 8, Health Maintenance Organizations and Limited Health Plans. See Utah Code 31A-1-301- Policyholder: means a person who controls a policy, binder, or oral contract by ownership, premium payment, or otherwise. See Utah Code 31A-1-301
(1)(a) If provided for in the articles or bylaws of a corporation, the board, by resolution adopted by a majority of the full board, may designate one or more committees.(1)(b) A committee designated under this Subsection (1) shall consist of three or more directors serving at the pleasure of the board.(1)(c) The board may designate one or more directors as alternate members of a committee to substitute for an absent member at any meeting of the committee.(1)(d) The designation of a committee and delegation of authority to the committee does not relieve the board or a director of responsibility imposed by law upon the board or director.(2)(2)(a)(2)(a)(i) Except for a corporation described under Subsection 31A-5-407(4), a corporation shall have an audit committee.(2)(a)(ii) A corporation’s entire board constitutes the audit committee if the corporation:(2)(a)(ii)(A) is described under Subsection 31A-5-407(4); and(2)(a)(ii)(B) does not have an audit committee that complies with this Subsection (2).(2)(b) If a corporation is required to have an audit committee under Subsection (2)(a), a member of the audit committee may not be an inside director as defined under Subsection 31A-5-407(3).(2)(c) An audit committee shall maintain an overview of the audit activities, systems, and staff of the company and of the activities of the outside auditors, in order to advise the board on the adequacy of fiscal control.(2)(d) A corporation shall give an audit committee direct and private access to company data and personnel as that committee considers necessary.(2)(e) An audit committee may meet privately with the outside directors as the audit committee sees fit.(2)(f) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the commissioner may make rules pertaining to audit committee requirements similar to those outlined in the Annual Financial Reporting Model Regulation of the National Association of Insurance Commissioners.(3)(3)(a) When the board is not in session, a committee may exercise the powers of the board in the management of the business and affairs of the corporation to the extent authorized in the resolution or in the articles or bylaws, except action regarding:(3)(a)(i) compensation or indemnification of a person who is:(3)(a)(i)(A) a director;(3)(a)(i)(B) a principal officer; or(3)(a)(i)(C) one of the three most highly paid employees;(3)(a)(ii) benefits or payments requiring shareholder or policyholder approval;(3)(a)(iii) approval of a contract requiring board approval under Section 31A-5-414;(3)(a)(iv) approval of a transaction in which a director has a material interest adverse to the corporation;(3)(a)(v) amendment of the articles or bylaws;(3)(a)(viii) voluntary dissolution under Section 31A-5-504;(3)(a)(ix) transfer of business or assets under Section 31A-5-508;(3)(a)(x) any other decision requiring shareholder or policyholder approval;(3)(a)(xi) amendment or repeal of an action taken by the full board, which by its terms is not subject to amendment or repeal by a committee;(3)(a)(xii) dividends or other distributions to shareholders, policyholders, or voting members other than in the routine implementation of a policy determination of the full board;(3)(a)(xiii) selection of a principal officer; and(3)(a)(xiv) filling a vacancy on the board or on a committee created under Subsection (1), except that the articles or bylaws may provide for a temporary appointment to fill a vacancy on the board or a committee.(3)(b) A temporary appointment provided for in Subsection (3)(a)(xiv) may last only until the end of the next board meeting.(4) The full board shall review a transaction in which an officer has a material financial interest adverse to the corporation at the next board meeting after the transaction.