To amend chapter 376, RSMo, by adding eight new sections relating to the reorganization of mutual life insurance companies.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF MISSOURI,

AS FOLLOWS:

Section A. Chapter 376, RSMo, is amended by adding thereto eight new sections, to be known as sections 376.1210, 376.1213, 376.1216, 376.1219, 376.1222, 376.1225, 376.1228 and 376.1231, to read as follows:

376.1210. 1. As used in sections 376.1210 to 376.1231, the following terms shall mean:

(1) "Director", the director of the Missouri department of insurance;

(2) "Mutual holding company", a mutual life insurance holding company formed under sections 376.1210 to 376.1231.

2. A domestic mutual life insurance company organized and operating under this chapter may reorganize by forming a mutual life insurance holding company based upon a mutual plan or by merging its policyholders' membership into such a mutual life insurance holding company, and continuing the corporate existence of the reorganizing mutual life insurance company either at the time of the reorganization or at some later time as a stock life insurance company, as a joint stock and mutual life insurance company, or as a mutual life insurance company. This authority is in addition to powers granted insurance companies under chapter 382, RSMo.

376.1213. A mutual life insurance company proposing to reorganize under sections 376.1210 to 376.1231 shall form a mutual life insurance holding company and shall file an application with the director which shall contain such insurer's plan of reorganization. The director shall review the application, retain such consultants as needed, conduct an adequate review to assure that policyholders' interests are protected, and may conduct a public hearing. The director shall approve formation of the mutual holding company and the plan of reorganization unless he shall find that the plan is not fair and equitable to the policyholders. The director may condition such approval on adoption of such modifications to the plan as he shall find necessary for the protection of the policyholders' interests.

376.1216. All of the shares of the capital stock of the reorganized life insurance company, if any, shall be issued to the mutual holding company, which shall at all times own a majority of the voting shares of the capital stock of the reorganized life insurance company. Provided, however, that either at the time of the reorganization or at some later time, the mutual holding company may create a stock holding company under chapter 351, RSMo, for the purpose of owning all of the stock of the reorganized life insurance company, so long as the mutual holding company shall at all times own a majority of the voting shares of the capital stock of the stock holding company.

376.1219. 1. The membership interests of the policyholders of a reorganized life insurance company shall become membership interests in the mutual holding company. Policyholders of the reorganized life insurance company shall be members of the mutual holding company in accordance with the articles of incorporation and bylaws of the mutual holding company and the applicable provisions of this chapter relating to mutual life insurance companies.

2. No member of a mutual holding company may transfer membership or any right arising therefrom.

3. A member of a mutual holding company is not, as such, personally liable for the acts, debts, liabilities, or obligations of the company.

4. No assessments of any kind may be imposed upon the members of a mutual holding company by the directors or members, or because of any liability of any company owned or controlled by the mutual holding company, or because of any act, debt, or liability of the mutual holding company itself.

5. A membership interest in a domestic mutual holding company shall not constitute a security under the laws of this state.

376.1222. Sections 382.040, 382.060 and 382.095, RSMo, shall not apply to a reorganization or merger pursuant to this section.

376.1225. A mutual holding company organized under section 376.1210 shall be incorporated pursuant to this chapter, and this requirement shall supersede any conflicting provisions of this chapter. The articles of incorporation and any amendments to such articles of the mutual holding company shall be subject to approval of the director and the attorney general in the same manner as those of a mutual life insurance company.

376.1228. A mutual holding company shall have the same powers granted to domestic insurance companies under chapter 382, RSMo, relating to insurance holding company systems and be subject to its requirements and provisions, except as provided in section 376.1222. Neither the mutual holding company or any stock holding company created pursuant to sections 376.1210 to 376.1231 shall be an insurer or have the authority to engage in the business of insurance. A mutual holding company may enter into an affiliation agreement or a merger agreement with any mutual life insurance company authorized to do business in this state. Any such merger agreement may authorize participating policyholders of the mutual life insurance company to become members of the mutual holding company. Any such affiliation agreement or merger agreement is subject to the insurance laws of this state relating to such transactions entered into by a domestic mutual life insurance company.

376.1231. 1. A mutual holding company is subject to supervision of the director in the same manner as an insurer subject to the provisions of this chapter and shall automatically be a party to any proceeding under the Missouri Insurers Supervision, Rehabilitation and Liquidation Act, sections 375.1150 to 375.1246, RSMo, involving a life insurance company which, as a result of a reorganization pursuant to section 376.1210, is a subsidiary of the mutual holding company. In any proceeding under said act involving the reorganized life insurance company, the assets of the mutual holding company are deemed to be assets of the estate of the reorganized life insurance company for purposes of satisfying the claims of the reorganized life insurance company's policyholders. A mutual holding company shall not dissolve or liquidate without the approval of the director or as ordered by the court pursuant to said supervision, rehabilitation, and liquidation act.

2. Sections 375.201, 375.206, 375.216, 375.221 and 375.226, RSMo, are applicable to a demutualization of a mutual holding company as if it were a mutual life insurance company.