Sec. 15. (a) Except as provided in subsection (b), a domestic mutual company that organized before July 1, 1977, must maintain a surplus of not less than two hundred fifty thousand dollars ($250,000). This subsection does not apply to a standard farm mutual insurance company that is organized under IC 27-5 (before its repeal) or IC 27-5.1.

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Terms Used In Indiana Code 27-1-6-15

  • capital: means the aggregate amount paid in on the shares of capital stock of a corporation issued and outstanding. See Indiana Code 27-1-2-3
  • Commissioner: means the "insurance commissioner" of this state. See Indiana Code 27-1-2-3
  • Department: means "the department of insurance" of this state. See Indiana Code 27-1-2-3
  • Insurance: means a contract of insurance or an agreement by which one (1) party, for a consideration, promises to pay money or its equivalent or to do an act valuable to the insured upon the destruction, loss or injury of something in which the other party has a pecuniary interest, or in consideration of a price paid, adequate to the risk, becomes security to the other against loss by certain specified risks; to grant indemnity or security against loss for a consideration. See Indiana Code 27-1-2-3
  • insurer: means a company, firm, partnership, association, order, society or system making any kind or kinds of insurance and shall include associations operating as Lloyds, reciprocal or inter-insurers, or individual underwriters. See Indiana Code 27-1-2-3
  • premium: means money or any other thing of value paid or given in consideration to an insurer, insurance producer, or solicitor on account of or in connection with a contract of insurance and shall include as a part but not in limitation of the above, policy fees, admission fees, membership fees and regular or special assessments and payments made on account of annuities. See Indiana Code 27-1-2-3
  • United States: includes the District of Columbia and the commonwealths, possessions, states in free association with the United States, and the territories. See Indiana Code 1-1-4-5
  • Year: means a calendar year, unless otherwise expressed. See Indiana Code 1-1-4-5
     (b) A domestic mutual company that organized before July 1, 1977, must maintain a surplus of not less than:

(1) seven hundred fifty thousand dollars ($750,000), if it markets one (1) or more kinds of insurance under both Class II and Class III, other than Class II(k) insurance;

(2) one million dollars ($1,000,000), if it markets one (1) or more kinds of insurance under Class II, including Class II(k) insurance; or

(3) one million dollars ($1,000,000), if it markets one (1) or more kinds of insurance under both Class II and Class III, including Class II(k) insurance.

     (c) A domestic mutual company that organized after June 30, 1977, must maintain a surplus of not less than one million two hundred fifty thousand dollars ($1,250,000). However, when it organizes, it must:

(1) have a surplus of not less than two million dollars ($2,000,000);

(2) for the one (1) or more kinds of insurance under Class I that it intends to market, have received applications for insurance from not less than four hundred (400) persons, each application for an amount not less than one thousand dollars ($1,000), and have received the first year‘s premium due on a policy to be issued on each such application; and

(3) for the one (1) or more kinds of insurance under Class II or Class III that it intends to market, have received applications for insurance covering not less than eight hundred (800) separate risks in not less than forty (40) policies to be issued to not less than forty (40) members, and have received premiums amounting to not less than one hundred thousand dollars ($100,000) for those policies.

     (d) A domestic mutual company must deposit with the department in cash or in obligations of the United States:

(1) twenty-five thousand dollars ($25,000), if it organized before June 30, 1955;

(2) fifty thousand dollars ($50,000), if it organized after June 29, 1955, and before March 7, 1967; or

(3) one hundred thousand dollars ($100,000), if it organized after March 6, 1967.

This subsection does not apply to a standard farm mutual insurance company that is organized under IC 27-5 (before its repeal) or IC 27-5.1.

     (e) If the commissioner determines that the continued operation of a domestic mutual company may be hazardous to the policyholders or the general public, the commissioner may, upon the commissioner’s determination, issue an order requiring the insurer to increase the insurer’s capital and surplus based on the type, volume, and nature of the business transacted.

Formerly: Acts 1935, c.162, s.75; Acts 1955, c.316, s.2; Acts 1967, c.127, s.3. As amended by Acts 1977, P.L.282, SEC.2; P.L.130-1994, SEC.15; P.L.116-1994, SEC.20; P.L.129-2003, SEC.1.

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