{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/38.2-1005.1.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/38.2-1005.1.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/38.2-1005.1.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/38.2-1005.1.html"}],"law_id":81081,"edition_id":1,"section_id":81081,"structure_id":15310,"section_number":"38.2-1005.1","catch_line":"Conversion of a domestic mutual insurer to a domestic stock insurer","history":"1996, cc. 801, 831; 2001, c. 726.","full_text":"A\n\nAny domestic mutual insurer may convert to a domestic stock insurer pursuant to a plan of conversion approved by the Commission.B\n\nThe Commission shall approve any such plan of conversion if, after giving notice and an opportunity to be heard to the policyholders of the domestic mutual insurer, the Commission determines that:1\n\nThe terms and conditions of the plan are fair and equitable to the policyholders of the domestic mutual insurer;2\n\nThe plan is subject to approval by a vote of more than two-thirds of all votes cast on the plan at a meeting of the members of the domestic mutual insurer called for that purpose at which a quorum is present;3\n\nExcept as otherwise provided in subdivision 4 of this subsection, the plan allocates and directs that the entire stock ownership interests and other consideration to be distributed pursuant to the plan of conversion be distributed to the policyholders of the domestic mutual insurer;4\n\nIn the case of a domestic mutual insurer that converted from a health services plan that was in existence prior to December 31, 1987, the plan of conversion allocates and distributes to the State Treasurer, in addition to any shares of stock that the Commonwealth may be entitled to receive as a policyholder, shares of stock or cash or both with a value equal to the surplus, computed in accordance with generally accepted accounting principles, of such health services plan on December 31, 1987, plus ten million dollars; and5\n\nImmediately after the conversion, the insurer will have the fully paid capital stock and surplus required by applicable law.C\n\nA plan of conversion that utilizes a statutory merger in order to effect a conversion may be approved in accordance with this section and § 38.2-1005.1:9, and the provisions of § 38.2-1018 shall not be applicable to such plan of conversion.","order_by":null,"text":{"0":{"id":290586,"text":"Any domestic mutual insurer may convert to a domestic stock insurer pursuant to a plan of conversion approved by the Commission.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":290587,"text":"The Commission shall approve any such plan of conversion if, after giving notice and an opportunity to be heard to the policyholders of the domestic mutual insurer, the Commission determines that:","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"B1"},"2":{"id":290588,"text":"The terms and conditions of the plan are fair and equitable to the policyholders of the domestic mutual insurer;","type":"section","prefixes":["B","1"],"prefix":"1","entire_prefix":"B1","prefix_anchor":"B1","level":2,"prior_prefix":"B","next_prefix":"B2"},"3":{"id":290589,"text":"The plan is subject to approval by a vote of more than two-thirds of all votes cast on the plan at a meeting of the members of the domestic mutual insurer called for that purpose at which a quorum is present;","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B1","next_prefix":"B3"},"4":{"id":290590,"text":"Except as otherwise provided in subdivision 4 of this subsection, the plan allocates and directs that the entire stock ownership interests and other consideration to be distributed pursuant to the plan of conversion be distributed to the policyholders of the domestic mutual insurer;","type":"section","prefixes":["B","3"],"prefix":"3","entire_prefix":"B3","prefix_anchor":"B3","level":2,"prior_prefix":"B2","next_prefix":"B4"},"5":{"id":290591,"text":"In the case of a domestic mutual insurer that converted from a health services plan that was in existence prior to December 31, 1987, the plan of conversion allocates and distributes to the State Treasurer, in addition to any shares of stock that the Commonwealth may be entitled to receive as a policyholder, shares of stock or cash or both with a value equal to the surplus, computed in accordance with generally accepted accounting principles, of such health services plan on December 31, 1987, plus ten million dollars; and","type":"section","prefixes":["B","4"],"prefix":"4","entire_prefix":"B4","prefix_anchor":"B4","level":2,"prior_prefix":"B3","next_prefix":"B5"},"6":{"id":290592,"text":"Immediately after the conversion, the insurer will have the fully paid capital stock and surplus required by applicable law.","type":"section","prefixes":["B","5"],"prefix":"5","entire_prefix":"B5","prefix_anchor":"B5","level":2,"prior_prefix":"B4","next_prefix":"C"},"7":{"id":290593,"text":"A plan of conversion that utilizes a statutory merger in order to effect a conversion may be approved in accordance with this section and § 38.2-1005.1:9, and the provisions of § 38.2-1018 shall not be applicable to such plan of conversion.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B5"}},"ancestry":[{"id":15310,"edition_id":1,"name":"Organization of Domestic Insurers","identifier":"1","label":"article","depth":3,"order_by":1,"parent_id":12858,"metadata":{},"date_created":"2026-06-26 03:53:50","date_modified":"2026-06-26 03:53:50","permalink":{"id":210853,"object_type":"structure","relational_id":15310,"identifier":"1","token":"38.2\/10\/1","url":"\/38.2\/10\/1\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12858,"edition_id":1,"name":"Organization, Admission and Licensing of Insurers","identifier":"10","label":"chapter","depth":2,"order_by":1,"parent_id":12698,"metadata":{},"date_created":"2026-06-26 03:43:57","date_modified":"2026-06-26 03:43:57","permalink":{"id":210851,"object_type":"structure","relational_id":12858,"identifier":"10","token":"38.2\/10","url":"\/38.2\/10\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12698,"edition_id":1,"name":"Insurance","identifier":"38.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:49","date_modified":"2026-06-26 03:43:49","permalink":{"id":210661,"object_type":"structure","relational_id":12698,"identifier":"38.2","token":"38.2","url":"\/38.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":58285,"structure_id":15310,"section_number":"38.2-1000","catch_line":"Incorporation of domestic stock insurers","url":"\/38.2-1000\/","token":"38.2\/10\/1\/38.2-1000","metadata":false},{"id":84575,"structure_id":15310,"section_number":"38.2-1001","catch_line":"Incorporation of domestic mutual insurers","url":"\/38.2-1001\/","token":"38.2\/10\/1\/38.2-1001","metadata":false},{"id":69780,"structure_id":15310,"section_number":"38.2-1002","catch_line":"Additional requirements of articles of incorporation; name","url":"\/38.2-1002\/","token":"38.2\/10\/1\/38.2-1002","metadata":false},{"id":82745,"structure_id":15310,"section_number":"38.2-1003","catch_line":"When corporate status attained; bylaws filed with Commission","url":"\/38.2-1003\/","token":"38.2\/10\/1\/38.2-1003","metadata":false},{"id":77980,"structure_id":15310,"section_number":"38.2-1004","catch_line":"Voting","url":"\/38.2-1004\/","token":"38.2\/10\/1\/38.2-1004","metadata":false},{"id":71096,"structure_id":15310,"section_number":"38.2-1005","catch_line":"Certain mutual companies and societies not to become stock companies without approval of Commission","url":"\/38.2-1005\/","token":"38.2\/10\/1\/38.2-1005","metadata":false},{"id":81081,"structure_id":15310,"section_number":"38.2-1005.1","catch_line":"Conversion of a domestic mutual insurer to a domestic stock insurer","url":"\/38.2-1005.1\/","token":"38.2\/10\/1\/38.2-1005.1","metadata":false}],"previous_section":{"id":71096,"structure_id":15310,"section_number":"38.2-1005","catch_line":"Certain mutual companies and societies not to become stock companies without approval of Commission","url":"\/38.2-1005\/","token":"38.2\/10\/1\/38.2-1005","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/38.2-1005.1\/","history_text":"

This law was first created in 1996. The record of its establishment is cataloged in chapters 801<\/a> and 831<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 1 time. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. That modification is as follows: in 2001, chapter 726<\/a>.<\/p>","references":[{"id":71096,"section_number":"38.2-1005","catch_line":"Certain mutual companies and societies not to become stock companies without approval of Commission","order_by":null,"url":"\/38.2-1005\/"},{"id":71758,"section_number":"38.2-1005.1:9","catch_line":"Conversion of mutual holding company","order_by":null,"url":"\/38.2-1005.1_9\/"}],"refers_to":[{"id":71758,"section_number":"38.2-1005.1:9","catch_line":"Conversion of mutual holding company","order_by":null,"url":"\/38.2-1005.1_9\/"},{"id":82366,"section_number":"38.2-1018","catch_line":"Plan of merger to be approved by Commission","order_by":null,"url":"\/38.2-1018\/"}],"permalink":{"id":210879,"object_type":"law","relational_id":81081,"identifier":"38.2-1005.1","token":"38.2\/10\/1\/38.2-1005.1","url":"\/38.2-1005.1\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/38.2-1005.1\/","token":"38.2\/10\/1\/38.2-1005.1","dublin_core":{"Title":"Conversion of a domestic mutual insurer to a domestic stock insurer","Type":"Text","Format":"text\/html","Identifier":"\u00a7 38.2-1005.1","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Any domestic mutual insurer<\/span> may convert to a domestic stock insurer<\/span> pursuant to a plan of conversion approved by the Commission<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> The Commission<\/span> shall approve any such plan of conversion if, after giving notice and an opportunity to be heard to the policyholders of the domestic mutual insurer<\/span>, the Commission<\/span> determines that: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The terms and conditions of the plan are fair and equitable<\/span> to the policyholders of the domestic mutual insurer<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The plan is subject to approval by a vote of more than two-thirds of all votes cast on the plan at a meeting of the members of the domestic mutual insurer<\/span> called for that purpose at which a quorum is present; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> Except as otherwise provided in subdivision 4 of this subsection, the plan allocates and directs that the entire stock ownership interests and other consideration to be distributed pursuant to the plan of conversion be distributed to the policyholders of the domestic mutual insurer<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> In the case of a domestic mutual insurer<\/span> that converted from a health services plan<\/span> that was in existence prior to December 31, 1987, the plan of conversion allocates and distributes to the State<\/span> Treasurer, in addition to any shares of stock that the Commonwealth may be entitled to receive as a policyholder, shares of stock or cash or both with a value equal to the surplus, computed in accordance with generally accepted accounting principles, of such health services plan<\/span> on December 31, 1987, plus ten million dollars; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> Immediately after the conversion, the insurer<\/span> will have the fully paid capital stock and surplus required by applicable law<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> A plan of conversion that utilizes a statutory merger in order<\/span> to effect a conversion may be approved in accordance with this section and § 38.2-1005.1:9<\/a>, and the provisions of § 38.2-1018<\/a> shall not be applicable to such plan of conversion. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nCONVERSION OF A DOMESTIC MUTUAL INSURER TO A DOMESTIC STOCK INSURER (\u00a7\n38.2-1005.1)\n\nA. Any domestic mutual insurer may convert to a domestic stock insurer pursuant\nto a plan of conversion approved by the Commission.\n\nB. The Commission shall approve any such plan of conversion if, after giving\nnotice and an opportunity to be heard to the policyholders of the domestic\nmutual insurer, the Commission determines that:\n\n 1. The terms and conditions of the plan are fair and equitable to the\n policyholders of the domestic mutual insurer;\n\n 2. The plan is subject to approval by a vote of more than two-thirds of all\n votes cast on the plan at a meeting of the members of the domestic mutual\n insurer called for that purpose at which a quorum is present;\n\n 3. Except as otherwise provided in subdivision 4 of this subsection, the plan\n allocates and directs that the entire stock ownership interests and other\n consideration to be distributed pursuant to the plan of conversion be\n distributed to the policyholders of the domestic mutual insurer;\n\n 4. In the case of a domestic mutual insurer that converted from a health\n services plan that was in existence prior to December 31, 1987, the plan of\n conversion allocates and distributes to the State Treasurer, in addition to\n any shares of stock that the Commonwealth may be entitled to receive as a\n policyholder, shares of stock or cash or both with a value equal to the\n surplus, computed in accordance with generally accepted accounting principles,\n of such health services plan on December 31, 1987, plus ten million dollars;\n and\n\n 5. Immediately after the conversion, the insurer will have the fully paid\n capital stock and surplus required by applicable law.\n\nC. A plan of conversion that utilizes a statutory merger in order to effect a\nconversion may be approved in accordance with this section and §\n38.2-1005.1:9, and the provisions of § 38.2-1018 shall not be applicable to\nsuch plan of conversion.\n\nHISTORY: 1996, cc. 801, 831; 2001, c. 726.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}