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§ 3-221. Mergers and conversions

MD Ins Code § 3-221 (2019) (N/A)
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(a)    A domestic reciprocal insurer may merge with another reciprocal insurer or be converted to a stock insurer or mutual insurer if:

(1)    at least two-thirds of the subscribers who vote on the merger or conversion after notice vote in favor of the merger or conversion; and

(2)    the Commissioner approves the terms of the merger or conversion.

(b)    The Commissioner may not approve a plan for merger or conversion unless:

(1)    the plan is equitable to subscribers; and

(2)    for conversion to a stock insurer, the plan gives each subscriber:

(i)    preferential right to acquire stock of the proposed stock insurer proportionate to the subscriber's interest in the reciprocal insurer; and

(ii)    a reasonable length of time to exercise the preferential right.

(c)    If a domestic reciprocal insurer converts to a stock insurer or mutual insurer, the successor stock insurer or mutual insurer is subject to the same capital or surplus requirements and has the same rights as a like domestic insurer that transacts like kinds of insurance business.

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