20-210. Minimum required capital stock or basic
surplus
A. Except as provided in subsection B, to qualify for authority to transact any one
kind of insurance or combinations of kinds of insurance as shown below, an insurer shall
possess and thereafter maintain unimpaired minimum required capital stock, if a stock
insurer, or unimpaired minimum required basic surplus, if a mutual or a reciprocal
insurer, and free surplus not less than fifty per cent of the initial free surplus, and
when first so authorized shall possess initial free surplus, all in amounts not less than
as determined from the following table:
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ ¦ Stock Insurers ¦ Mutual Insurers ¦ Reciprocal Insurers ¦ ¦ ¦ ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ ¦ Minimum ¦ Minimum ¦ Minimum ¦ ¦ ¦ ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Kind or ¦ Required ¦ Initial ¦ Required ¦ Initial ¦ Required ¦ Initial ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Kinds of ¦ Capital ¦ Free ¦ Basic ¦ Free ¦ Basic ¦ Free ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Insurance ¦ Stock ¦ Surplus ¦ Surplus ¦ Surplus ¦ Surplus ¦ Surplus ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Casualty ¦ $600,000 ¦ $300,000 ¦ $600,000 ¦ $300,000 ¦ $600,000 ¦ $300,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Disability ¦ 300,000 ¦ 150,000 ¦ 300,000 ¦ 150,000 ¦ 300,000 ¦ 150,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Life ¦ 300,000 ¦ 150,000 ¦ 300,000 ¦ 150,000 ¦ ¦ ¦
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not applicable
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Disability and ¦ 400,000 ¦ 200,000 ¦ 400,000 ¦ 200,000 ¦ ¦ ¦
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not applicable
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Life ¦ ¦ ¦ ¦ ¦ ¦ ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Marine and ¦ 600,000 ¦ 300,000 ¦ 600,000 ¦ 300,000 ¦ 600,000 ¦ 300,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Transportation ¦ ¦ ¦ ¦ ¦ ¦ ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Property ¦ 600,000 ¦ 300,000 ¦ 600,000 ¦ 300,000 ¦ 600,000 ¦ 300,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Surety ¦ 1,000,000 ¦ 500,000 ¦ 1,000,000 ¦ 500,000 ¦ 1,000,000 ¦ 500,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Multiple line ¦ 1,000,000 ¦ 500,000 ¦ 1,000,000 ¦ 500,000 ¦ 1,000,000 ¦ 500,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Vehicle ¦ 600,000 ¦ 300,000 ¦ 600,000 ¦ 300,000 ¦ 600,000 ¦ 300,000 ¦
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¦ ¦ ¦ ¦ ¦ ¦ ¦ ¦
¦ Title ¦ 500,000 ¦ 250,000 ¦ ¦ ¦ ¦ ¦
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not applicable
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not applicable
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B. A domestic insurer, including a domestic limited stock insurer subject to the
capital and surplus requirements prescribed in subsection D of this section, holding a
valid certificate of authority to transact insurance in this state of the kind or kinds
as set forth in subsection A prior to the effective date of this section, may, if
otherwise qualified, continue to be so authorized while possessing the amount of paid-in
capital stock, if a stock insurer, or surplus, if a mutual insurer, required by the laws
of this state for such authority immediately prior to the effective date of this
section. The director shall not grant such an insurer authority to transact any other or
additional kinds of insurance unless such insurer fully complies with the requirements as
to capital and surplus, as applied to all kinds of insurance which the insurer proposes
to transact, as provided by this section for like insurers applying for original
certificates of authority under this title. Upon a change in the control of such an
insurer, such insurer shall within one year from the effective date of such change in
control meet the capital and surplus requirements for new insurers pursuant to subsection
A of this section. For the purposes of this subsection "control" shall have the same
meaning and be determined in the same manner as prescribed in section 20-481.
C. Capital and surplus requirements are based upon all kinds of insurance
transacted by the insurer in all areas in which the insurer operates or proposes to
operate whether or not only a portion of such kinds are to be transacted in this state.
D. Notwithstanding the limitation in the first sentence of subsection B of this
section on increased capitalization for authorized insurers, any domestic limited stock
insurer which on January 31, 1969 was the holder of a valid certificate of authority
shall not be required to meet the capital and initial free surplus requirement of this
section, but after January 31, 1980, any such domestic limited stock insurer shall
possess and thereafter maintain:
1. Minimum paid-in capital stock of one hundred thousand dollars, and
2. Surplus funds in an amount of not less than one-half such minimum paid-in
capital. On and after the effective date of this section any domestic limited stock
insurer which holds a valid certificate of authority immediately prior to such effective
date and which qualified under the provisions of subsection B of section 20-708 and whose
premium income as a direct writer during calendar year 1976 did not exceed fifty per cent
of its total premium income including reinsurance premiums from insurance policies and
contracts for such year, shall be a domestic life and disability reinsurer and be subject
to the provisions of article 10, of chapter 4 of this title.
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