§ 4208. Financial and additional requirements for the organization of mutual life, accident and health, and legal services insurance companies. (a) (1) A mutual insurance company may be incorporated and licensed exclusively to do one or more of the kinds of insurance business specified in paragraphs one, two, three, twenty-nine and thirty-one of subsection (a) of section one thousand one hundred thirteen of this chapter, upon compliance with the applicable requirements of section one thousand two hundred one and subsection (e) of section one thousand one hundred two of this chapter and subsection (b) of this section.

Ask an insurance law question, get an answer ASAP!
Click here to chat with a lawyer about your rights.

(2) In this section:

(A) "Initial surplus" means the paid-in initial surplus required pursuant to paragraph nine of subsection (a) of section one thousand two hundred one and paragraph one of subsection (e) of section one thousand one hundred two of this chapter.

(B) "Minimum surplus" means the amount of surplus which such company shall, after being licensed to do business, at all times maintain unimpaired.

(C) "Applications" means individual applications for policies of life insurance, except that in the case of volunteer firefighters, it shall also mean applications for enrollment for coverage to be issued under group life insurance policies applied for by not less than twenty-five associations or organizations of volunteer firefighters in accordance with the provisions of paragraph seven of subsection (b) of section four thousand two hundred sixteen of this article.

(b) (1) If organized to do only the kind of insurance business specified in paragraph one of subsection (a) of section one thousand one hundred thirteen of this chapter, such company shall:

(A) have not less than one thousand bona fide applications for life insurance in an amount not less than one thousand dollars each;

(B) have received from each such applicant in cash the full amount of one annual premium on the policy applied for, which premiums in the aggregate at least equal twenty-five thousand dollars;

(C) have an initial surplus of one hundred fifty thousand dollars in cash; and

(D) have a minimum surplus of one hundred thousand dollars.

(2) If organized to do only the kind of business specified in item (i) of paragraph three of subsection (a) of section one thousand one hundred thirteen of this chapter, such company shall:

(A) have not less than five hundred bona fide applications for such insurance;

(B) have received from each such applicant in cash the full amount of one annual premium on the policy applied for, which premiums in the aggregate at least equal twenty thousand dollars;

(C) have an initial surplus of one hundred fifty thousand dollars in cash; and

(D) have a minimum surplus of one hundred thousand dollars, except that every such company initially licensed on or after July first, nineteen hundred eighty-two shall have an initial surplus and a minimum surplus in an amount which is at least equal to two hundred percent of that required of a like company licensed prior to July first, nineteen hundred eighty-two.

(3) If organized to do the kinds of insurance business specified in paragraph one and in item (i) of paragraph three of subsection (a) of section one thousand one hundred thirteen of this chapter, such company shall comply with both paragraph one and paragraph two of this subsection.

(4) To be organized to do the kind of insurance business specified in paragraph two of subsection (a) of section one thousand one hundred thirteen of this chapter, such company shall meet the organizational requirements of paragraph one hereof and shall have an initial surplus and a minimum surplus, each in an amount at least fifty thousand dollars in excess of the respective amounts otherwise required by paragraph one hereof.

(5) To be organized to do the kind of insurance business specified in item (ii) of paragraph three or paragraph twenty-nine of subsection (a) of section one thousand one hundred thirteen of this chapter, such company shall meet the organizational requirements of one or more of paragraphs one through four hereof and shall have an initial surplus and a minimum surplus, each in an amount at least fifty thousand dollars in excess of the highest applicable respective amount required by such paragraph or paragraphs, except that any such company initially licensed on or after July first, nineteen hundred eighty-two shall have an initial surplus and a minimum surplus, each in an amount at least one hundred thousand dollars in excess of the highest applicable respective amount required by such paragraph or paragraphs.