North Dakota Administrative Code
Title 45 - Insurance, Commissioner of
Article 45-03 - Regulation of Insurance Companies
Chapter 45-03-21 - Demutualization
Section 45-03-21-01 - Definitions

For the purposes of this chapter, the following definitions shall apply:

1. "Commissioner" means the insurance commissioner.

2. "Converted insurer" means a domestic mutual insurer that has completed a demutualization subject to this chapter.

3. "Converting insurer" means a domestic mutual insurer that has filed, or announced its intent to file, an application for demutualization under this chapter.

4. "Demutualization" means any transaction as part of which:

a. A domestic mutual insurer is converted into a stock corporation;

b. A substantial portion of the ownership of a domestic mutual insurer is acquired by, or merged with, another entity that is not a mutual insurer; or

c. The ownership interest of the members in a domestic mutual insurer is reduced substantially or eliminated.

5. "Eligible member" means a person who, at any time during the one year preceding the record date, has been the owner of a policy of insurance issued by the converting insurer. Unless otherwise provided in the conversion plan and approved by the commissioner, a person insured under a certificate issued under a group policy is an eligible member.

6. "Equitable share" means the portion allocated to an eligible member of the securities or other consideration of the converting insurer referred to in subsection 3 of section 45-03-21-05, such allocation to be made in accordance with the provisions of subsection 4 of section 45-03-21-05.

7. "Member" means a person who is the holder of a policy or contract of insurance issued by the converting insurer, including the holder of a certificate issued under a group insurance policy. The term "member" does not include a dependent of a certificate holder or policyholder who is insured by the converting insurer solely by virtue of being such a dependent nor does it include the holder of a contract issued by the converting insurer under which there is not a substantial assumption of risk, such as a contract for administrative services only.

8. "Membership interest" means all rights to which members of the converting insurer are entitled under applicable law and under the converting insurer's bylaws, articles of incorporation, insurance policies, or other contracts, including the right to vote and to participate in any distribution of earnings or surplus, whether or not incident to the company's dissolution or liquidation.

9. "Mutual insurance holding company" means a company formed under North Dakota Century Code section 26.1-12.1-02.

10. "Plan of conversion" or "conversion plan" means a plan to engage or participate in a demutualization which is subject to this chapter.

11. "Record date" means the date on which the converting insurer's board of directors adopts a plan of conversion or some other date specified as the record date in the plan of conversion and approved by the commissioner.

General Authority: NDCC 26.1-12-32

Law Implemented: NDCC 26.1-12-32