2942

(1) While it maintains surplus funds in amount not less than the capital required of a domestic stock insurer transacting the same kinds of insurance, a domestic mutual insurer, by resolution of its board of directors approved by the Commissioner, may extinguish the contingent liability of each and all of its policyholders and issue policies without such contingent liability.\n(2) If the insurer ceases to have such required amount of surplus, or if the board of directors adopts a resolution for the reinstatement of contingent liability, the Commissioner shall withdraw his approval previously given and the insurer shall not thereafter issue any policy without contingent liability, or renew or accept further premium on policies then in force without written endorsement thereon providing for contingent liability.\n(3) A foreign mutual insurer may issue nonassessable policies in Puerto Rico if it satisfies the Commissioner that such policies are in fact nonassessable under the laws of the insurer’s domicile.\nHistory —Ins. Code § 29.420.