Section 1551 Of Article 16. Merger Of Certain Reciprocal Insurers From California Insurance Code >> Division 1. >> Part 2. >> Chapter 3. >> Article 16.
1551
. By following the procedure specified in this article, any
domestic reciprocal insurer described in this article may merge,
consolidate, or otherwise unite with or become a part of, or may
reinsure all of its policies with, and, upon assumption of all of its
liabilities, may transfer all of its assets to, any other domestic
reciprocal insurer or an incorporated insurer, domestic or foreign.
If an insurer not admitted in California is the surviving entity in
the transaction, the plan and agreement shall provide either for that
insurer to be admitted to transact insurance in California or for
any nonsurviving insurer admitted in California to withdraw from the
state. The plan and agreement by which the transaction is to be
effected shall be approved by a resolution of a majority of the body
exercising the subscribers' rights selected pursuant to Section 1308
for each domestic reciprocal insurer that is a party to the
transaction or by such higher number as may be required by the
documents governing the reciprocal, before it is submitted to the
subscribers for their consideration. The resolution shall specify the
reasons for and the purposes of the proposed transaction and the
manner in which the transaction is expected to benefit and serve the
best interests of the domestic reciprocal insurer and its
subscribers. The plan and agreement shall be approved on behalf of
each constituent other party by those persons required to approve
those transactions by the laws under which that other party is
organized or is otherwise governed.