Sec. 826.052. GENERAL REQUIREMENTS; EFFECT OF CONVERSION ON POLICIES. (a) Each conversion plan must include the provisions required by this chapter.
(b) Each policy in effect on the effective date of the conversion remains in effect under the terms of that policy, except that the following rights, to the extent they existed in the converting company, are extinguished on the effective date of the conversion:
(1) any voting rights of policyholders;
(2) except as provided by Subsection (c), a right to share in the surplus or profits of the converting company; and
(3) any assessment provisions.
(c) The holder of a participating policy in effect on the effective date of the conversion continues to have a right to receive dividends as provided by the participating policy.
(d) On the renewal date of a participating policy, the resulting company may issue to the insured a nonparticipating policy as a substitute for the participating policy, unless the participating policy is:
(1) a guaranteed renewable accident and health policy; or
(2) a guaranteed renewable, noncancellable accident and health policy.
(e) All the costs and expenses connected with a conversion plan shall be paid or reimbursed by the converting company or the resulting company.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 1, eff. June 1, 2003.
Structure Texas Statutes
Title 6 - Organization of Insurers and Related Entities
Subtitle B - Organization of Regulated Entities
Chapter 826 - Conversion of Mutual Insurance Company to Stock Insurance Company
Subchapter B. Conversion Plan Adoption and Requirements
Section 826.051. Plan Adoption
Section 826.052. General Requirements; Effect of Conversion on Policies
Section 826.053. Sale of Capital Stock
Section 826.054. Purchase Price of Capital Stock
Section 826.055. Limitation on Acquisition of Capital Stock
Section 826.056. Directors and Officers
Section 826.057. Rights of Holder of Surplus Notes
Section 826.058. Subscription Rights; General Provisions
Section 826.059. Subscription Rights; Tax-Qualified Employee Benefit Plan