§ 58‑7‑75. Amountof capital and/or surplus required; impairment of capital or surplus.
The amount of capital and/orsurplus requisite to the formation and organization of companies under theprovisions of Articles 1 through 64 of this Chapter shall be as follows:
(1) Stock Life InsuranceCompanies. A stock corporation may be organized in the manner prescribed inthis Chapter and licensed to do the business of life insurance, only when ithas paid‑in capital of at least six hundred thousand dollars ($600,000)and a paid‑in initial surplus of at least nine hundred thousand dollars($900,000), and it may in addition do the kind of business specified in G.S. 58‑7‑15(2),without having additional capital or surplus. Every such company shall at alltimes thereafter maintain a minimum capital of not less than six hundredthousand dollars ($600,000) and a minimum surplus of at least one hundred fiftythousand dollars ($150,000). Provided that, any such corporation may do eitheror both of the kinds of insurance authorized for stock accident and healthinsurance companies, as set out in G.S. 58‑7‑15(3)a. and b., whereits charter so permits, and only as long as it maintains a minimum capital andsurplus equal to the sum of the minimum capital and surplus requirements ofthis subdivision and the minimum capital and surplus requirements ofsubdivision (2) of this section.
(1a) Non‑Stock LifeInsurance Companies. A nonstock corporation, not inclusive of a corporationorganized pursuant to subdivision (6) of this section, may be organized in themanner prescribed in this Chapter and licensed to do the business of lifeinsurance, only when it has a paid in initial surplus of at least one millionfive hundred thousand dollars ($1,500,000) and it may in addition do the kindof business specified in G.S. 58‑7‑15(2), without having additionalsurplus. Every such corporation shall at all times thereafter maintain aminimum surplus of at least seven hundred fifty thousand dollars ($750,000).Provided that, any such corporation may conduct the kind of insuranceauthorized for stock accident and health insurance companies, as set out inG.S. 58‑7‑15(3)a. and b., where its charter so permits, and only aslong as it maintains a minimum surplus equal to the sum of the minimum surplusrequirements of this subdivision and the minimum surplus requirements ofsubdivision (2a) of this section.
(2) Stock Accident andHealth Insurance Companies.
a. A stock corporationmay be organized in the manner prescribed in this Chapter and licensed to doonly the kind of insurance specified in G.S. 58‑7‑15(3)a, when ithas paid‑in capital of not less than four hundred thousand dollars($400,000), and a paid‑in initial surplus of at least six hundredthousand dollars ($600,000). Every such company shall at all times thereaftermaintain a minimum capital of not less than four hundred thousand dollars($400,000) and a minimum surplus of at least one hundred thousand dollars($100,000).
b. Any companyorganized under the provisions of paragraph a of this subdivision may, by theprovisions of its original charter or any amendment thereto, acquire the powerto do the kind of business specified in G.S. 58‑7‑15(3)b, if it hasa paid‑in capital of at least six hundred thousand dollars ($600,000) anda paid‑in initial surplus of at least nine hundred thousand dollars($900,000). Every such company shall at all times maintain a minimum capital ofnot less than six hundred thousand dollars ($600,000) and a minimum surplus ofat least one hundred fifty thousand dollars ($150,000).
(2a) Non‑StockAccident and Health Insurance Companies.
a. A non‑stockcorporation, not inclusive of a corporation organized pursuant to subdivision(6) of this section, may be organized in the manner prescribed in this Chapterand licensed to do only the kind of insurance specified in G.S. 58‑7‑15(3)a.when it has a paid in initial surplus of at least one million dollars($1,000,000). Every such corporation shall at all times thereafter maintain aminimum surplus of at least five hundred thousand dollars ($500,000).
b. Any non‑stockcorporation organized under the provisions of sub‑subdivision a. of thissubdivision may, by the provisions of its original charter or any amendmentthereto, acquire the power to do the kind of business specified in G.S. 58‑7‑15(3)b.,if it has a paid‑in initial surplus of at least one million five hundredthousand dollars ($1,500,000). Every such corporation shall at all timesmaintain a minimum surplus of at least seven hundred fifty thousand dollars($750,000).
(3) Stock Fire andMarine Companies. A stock corporation may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11),(12), (19), (20), (21) and (22) only when it has a paid‑in capital of notless than eight hundred thousand dollars ($800,000) and a paid‑in initialsurplus of not less than one million two hundred thousand dollars ($1,200,000).Every such company shall at all times thereafter maintain a minimum capital ofnot less than eight hundred thousand dollars ($800,000) and a minimum surplusof at least two hundred thousand dollars ($200,000). Provided that, any suchcorporation may do all the kinds of insurance authorized for casualty, fidelityand surety companies, as set out in subdivision (4) of this section where itscharter so permits, and when and so long as it meets and thereafter maintains aminimum capital and surplus equal to the sum of the minimum capital and surplusrequirements of this subdivision and the minimum capital and surplusrequirements of subdivision (4) of this section.
(4) Stock Casualty andFidelity and Surety Companies. A stock corporation may be organized in themanner prescribed in this Chapter and licensed to do one or more of the kindsof insurance specified in G.S. 58‑7‑15 (3), (6), (7), (8), (9),(10), (11), (12), (13), (14), (15), (16), (17), (18), (19), (21), (22), and(23) only when it has a paid‑in capital of not less than one milliondollars ($1,000,000) and a paid‑in initial surplus of not less than onemillion five hundred thousand dollars ($1,500,000). Every such company shall atall times thereafter maintain a minimum capital of not less than one milliondollars ($1,000,000) and a minimum surplus of at least two hundred fiftythousand dollars ($250,000).
(5) Mutual Fire andMarine Companies.
a. Limited assessmentcompanies. A limited assessment mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more kinds of insurancespecified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11), (12),(19), (20), (21) and (22) only when it has no less than five hundred thousanddollars ($500,000) of insurance in not fewer than 500 separate risks subscribedwith a paid‑in initial surplus of at least three hundred thousand dollars($300,000), which surplus shall at all times be maintained. The assessmentliability of a policyholder of a company organized in accordance with theprovisions of this sub‑subdivision shall not be limited to less than fiveannual premiums; provided, the limited assessment company may reduce theassessment liability of its policyholders from such five annual premiums to oneadditional annual premium when the free surplus of the company amounts to notless than three hundred thousand dollars ($300,000), which surplus shall at alltimes be maintained.
b. Assessable mutualcompanies. An assessable mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5) and (6), with anunlimited assessment liability of its policyholders only when it has not lessthan five hundred thousand dollars ($500,000) of insurance in not fewer than500 separate risks subscribed with a paid‑in initial surplus equal totwice the amount of the maximum net retained liability under the largest policyof insurance issued by the company; but not less than sixty thousand dollars($60,000); which surplus shall at all times be maintained. Provided thecompany, when its charter so permits, in addition may be licensed to do one ormore of the kinds of insurance specified in G.S. 58‑7‑15 (7), (8),(11), (12), (19), (20), (21) and (22), with an unlimited assessment liabilityof its policyholders, when its free surplus amounts to not less than sixtythousand dollars ($60,000), which surplus shall at all times be maintained.
c. Nonassessable mutualcompanies. A nonassessable mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11),(12), (19), (20), (21) and (22) and may be authorized to issue policies underthe terms of which a policyholder is not liable for any assessments in additionto the premium set out in the policy only when it has not less than fivehundred thousand dollars ($500,000) of insurance in not fewer than 500 separaterisks subscribed with a paid‑in initial surplus of not less than eighthundred thousand dollars ($800,000), which surplus shall at all times bemaintained.
d. Town or countymutual insurance companies. A town or county mutual insurance company withunlimited assessment liability may be organized in the manner prescribed inthis Chapter and licensed to do the kinds of insurance specified in G.S. 58‑7‑15(4)only when it has not less than fifty thousand dollars ($50,000) of insurance inforce in not fewer than 50 separate risks subscribed with a paid‑ininitial surplus of not less than fifteen thousand dollars ($15,000), whichsurplus shall at all times be maintained. A town or county mutual insurancecompany may, in addition to writing the business specified in G.S. 58‑7‑15(4)cover in the same policy the hazards usually insured against under an extendedcoverage endorsement when the company has not less than five hundred thousanddollars ($500,000) of insurance in force in not fewer than 500 separate risksand maintains a surplus at all times of not less than one hundred twentythousand dollars ($120,000): Provided, that the company may not operate in morethan six adjacent counties in this State. Any company authorized under thissection before July 1, 1991, shall be permitted to continue to do the samekinds of business that it was authorized to do prior to July 1, 1991, withoutbeing required to increase its surplus; however, the insurer shall increase itssurplus to the required amounts on or before July 1, 1992. The requirements ofthis sub‑subdivision as to surplus shall apply to such companies as aprerequisite to writing additional lines of business, and to such companies asa prerequisite to commencing business if unlicensed prior to July 1, 1991.
(6) Mutual Life,Accident and Health Insurance Companies. A nonassessable mutual insurancecompany may be organized in the manner prescribed in this Chapter, and licensedto do only one or more of the kinds of insurance specified in G.S. 58‑7‑15(1), (2) and (3) when it has complied with the requirements of this Chapter andwith those set forth in sub‑subdivisions a through d of this subdivision,inclusive, whichever shall be applicable.
a. If organized to doonly the kinds of insurance specified in G.S. 58‑7‑15 (1) and (2)the company shall have not less than 500 bona fide applications for lifeinsurance in an aggregate amount not less than five hundred thousand dollars($500,000), and shall have received from each such applicant in cash the fullamount of one annual premium on the policy for which the applicant applied, inan aggregate amount at least equal to ten thousand dollars ($10,000), and shallin addition have a paid‑in initial surplus of two hundred thousanddollars ($200,000), and shall have and maintain at all times a minimum surplusof one hundred thousand dollars ($100,000).
b. If organized to doonly the kind of insurance specified in paragraph a of G.S. 58‑7‑15(3)the company shall have not less than 250 bona fide applications for thatinsurance, and shall have received from each applicant in cash the full amountof one annual premium on the policy for which the applicant applied, in anaggregate amount of at least ten thousand dollars ($10,000), and shall have apaid‑in initial surplus of two hundred thousand dollars ($200,000) andshall have and maintain at all times a minimum surplus of one hundred thousanddollars ($100,000).
c. If organized to dothe kinds of insurance specified in G.S. 58‑7‑15 (1) and (3)a, thecompany shall have complied with the provisions of sub‑subdivisions a andb of this subdivision.
d. If organized to dothe kind of insurance specified in G.S. 58‑7‑15(3)b, in addition tothe kind or kinds of insurance designated in any one of the preceding sub‑subdivisionsof this subdivision, the company shall have a paid‑in initial surplus ofat least five hundred thousand dollars ($500,000) and shall maintain a minimumsurplus of at least three hundred thousand dollars ($300,000).
(7) Organization ofMutual Casualty, Fidelity and Surety Companies.
a. Nonassessable,mutual companies. A mutual insurance company with no assessment liabilityprovided for its policyholders may be organized in the manner prescribed inthis Chapter and licensed to do one or more of the kinds of insurance specifiedin G.S. 58‑7‑15 (3), (6), (7), (8), (9), (10), (11), (12), (13),(14), (15), (16), (17), (18), (19), (21) and (22) when it has a minimum paid‑ininitial surplus of one million dollars ($1,000,000) and not less than fivehundred thousand dollars ($500,000) in insurance subscribed in not less than500 separate risks. The surplus of the company shall at all times be maintainedat or above that amount.
b. Assessable mutualcompanies. A mutual insurance company with assessment liability provided forits policyholders may be organized in the manner prescribed in this Chapter andlicensed to do one or more of the kinds of insurance specified in G.S. 58‑7‑15(3), (6), (7), (8), (9), (10), (11), (12), (13), (14), (15), (16), (17), (18),(19), (21) and (22) when it has a minimum paid‑in initial surplus of fourhundred thousand dollars ($400,000) and not less than five hundred thousanddollars ($500,000) of insurance subscribed in not less than 500 separate risks.The company shall at all times maintain a surplus in an amount not less thanfour hundred thousand dollars ($400,000). The assessment liability of apolicyholder of the company shall not be limited to less than one annualpremium.
(8) Organization ofMutual Multiple Line Companies.
a. Assessable mutualcompanies. A company may do all the kinds of insurance authorized to be doneby a company organized under the provisions of sub‑subdivision (5)a, andsub‑subdivision (7)b of this subdivision, where its charter so permitswhen and if it meets the combined minimum requirements of those sub‑subdivisions.The assessment liability of policyholders of such a company shall not belimited to less than one annual premium within any one policy year.
b. Nonassessable mutualcompanies. A company may do all the kinds of insurance authorized to be doneby a company organized under the provisions of sub‑subdivision (5)c, andsub‑subdivision (7)a of this subdivision, where its charter so permitswhen and if it meets the combined minimum requirements of those paragraphs. Thepolicyholders of such a company shall not be subject to any assessment liability.
(9) Repealed by SessionLaws 1991, c. 644, s. 32.
(10) Impairment of Capitaland/or Surplus. Whenever the Commissioner finds from a financial statementmade by any company, or from a report of examination of any company, that itsadmitted assets are less than the aggregate amount of its liabilities and itsoutstanding capital stock, required minimum surplus, or both, the Commissionershall determine, in accordance with G.S. 58‑2‑165 and otherapplicable provisions of this Chapter, the amount of the impairment of capital,surplus, or both and issue an order in writing requiring the company toeliminate the impairment within such period of not more than 90 days as theCommissioner shall designate. The Commissioner may, by order served upon thecompany, prohibit the company from issuing any new policies while theimpairment exists. If at the expiration of the designated period the companyhas not satisfied the Commissioner that the impairment has been eliminated, anorder for the rehabilitation or liquidation of the company may be entered asprovided in Article 30 of this Chapter.
(11) The Commissioner mayrequire an insurer to have and maintain a larger amount of capital or surplusthan prescribed in this section, based upon the volume and kinds of insurancetransacted by the insurer and on the principles of risk‑based capital asdetermined by the NAIC or the Commissioner. (1899, c. 54, s. 26; 1903, c. 438, s. 4; Rev., s.4729; 1907, c. 1000, s. 5; 1913, c. 140, s. 2; C.S., s. 6332; 1929, c. 284, s.1; 1945, c. 386; 1947, c. 721; 1963, c. 943; 1965, c. 947; 1967, c. 300; 1971,c. 536; 1973, c. 686; 1979, c. 421, s. 1; 1983, c. 472; 1985, c. 666, s. 75;1985 (Reg. Sess., 1986), c. 1013, s. 10; 1989, c. 485, s. 53; 1991, c. 644, s.32; c. 681, s. 27; 1995, c. 193, s. 17; 2001‑223, s. 5.1; 2007‑127,s. 4; 2008‑124, s. 2.6.)
§ 58‑7‑75. Amountof capital and/or surplus required; impairment of capital or surplus.
The amount of capital and/orsurplus requisite to the formation and organization of companies under theprovisions of Articles 1 through 64 of this Chapter shall be as follows:
(1) Stock Life InsuranceCompanies. A stock corporation may be organized in the manner prescribed inthis Chapter and licensed to do the business of life insurance, only when ithas paid‑in capital of at least six hundred thousand dollars ($600,000)and a paid‑in initial surplus of at least nine hundred thousand dollars($900,000), and it may in addition do the kind of business specified in G.S. 58‑7‑15(2),without having additional capital or surplus. Every such company shall at alltimes thereafter maintain a minimum capital of not less than six hundredthousand dollars ($600,000) and a minimum surplus of at least one hundred fiftythousand dollars ($150,000). Provided that, any such corporation may do eitheror both of the kinds of insurance authorized for stock accident and healthinsurance companies, as set out in G.S. 58‑7‑15(3)a. and b., whereits charter so permits, and only as long as it maintains a minimum capital andsurplus equal to the sum of the minimum capital and surplus requirements ofthis subdivision and the minimum capital and surplus requirements ofsubdivision (2) of this section.
(1a) Non‑Stock LifeInsurance Companies. A nonstock corporation, not inclusive of a corporationorganized pursuant to subdivision (6) of this section, may be organized in themanner prescribed in this Chapter and licensed to do the business of lifeinsurance, only when it has a paid in initial surplus of at least one millionfive hundred thousand dollars ($1,500,000) and it may in addition do the kindof business specified in G.S. 58‑7‑15(2), without having additionalsurplus. Every such corporation shall at all times thereafter maintain aminimum surplus of at least seven hundred fifty thousand dollars ($750,000).Provided that, any such corporation may conduct the kind of insuranceauthorized for stock accident and health insurance companies, as set out inG.S. 58‑7‑15(3)a. and b., where its charter so permits, and only aslong as it maintains a minimum surplus equal to the sum of the minimum surplusrequirements of this subdivision and the minimum surplus requirements ofsubdivision (2a) of this section.
(2) Stock Accident andHealth Insurance Companies.
a. A stock corporationmay be organized in the manner prescribed in this Chapter and licensed to doonly the kind of insurance specified in G.S. 58‑7‑15(3)a, when ithas paid‑in capital of not less than four hundred thousand dollars($400,000), and a paid‑in initial surplus of at least six hundredthousand dollars ($600,000). Every such company shall at all times thereaftermaintain a minimum capital of not less than four hundred thousand dollars($400,000) and a minimum surplus of at least one hundred thousand dollars($100,000).
b. Any companyorganized under the provisions of paragraph a of this subdivision may, by theprovisions of its original charter or any amendment thereto, acquire the powerto do the kind of business specified in G.S. 58‑7‑15(3)b, if it hasa paid‑in capital of at least six hundred thousand dollars ($600,000) anda paid‑in initial surplus of at least nine hundred thousand dollars($900,000). Every such company shall at all times maintain a minimum capital ofnot less than six hundred thousand dollars ($600,000) and a minimum surplus ofat least one hundred fifty thousand dollars ($150,000).
(2a) Non‑StockAccident and Health Insurance Companies.
a. A non‑stockcorporation, not inclusive of a corporation organized pursuant to subdivision(6) of this section, may be organized in the manner prescribed in this Chapterand licensed to do only the kind of insurance specified in G.S. 58‑7‑15(3)a.when it has a paid in initial surplus of at least one million dollars($1,000,000). Every such corporation shall at all times thereafter maintain aminimum surplus of at least five hundred thousand dollars ($500,000).
b. Any non‑stockcorporation organized under the provisions of sub‑subdivision a. of thissubdivision may, by the provisions of its original charter or any amendmentthereto, acquire the power to do the kind of business specified in G.S. 58‑7‑15(3)b.,if it has a paid‑in initial surplus of at least one million five hundredthousand dollars ($1,500,000). Every such corporation shall at all timesmaintain a minimum surplus of at least seven hundred fifty thousand dollars($750,000).
(3) Stock Fire andMarine Companies. A stock corporation may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11),(12), (19), (20), (21) and (22) only when it has a paid‑in capital of notless than eight hundred thousand dollars ($800,000) and a paid‑in initialsurplus of not less than one million two hundred thousand dollars ($1,200,000).Every such company shall at all times thereafter maintain a minimum capital ofnot less than eight hundred thousand dollars ($800,000) and a minimum surplusof at least two hundred thousand dollars ($200,000). Provided that, any suchcorporation may do all the kinds of insurance authorized for casualty, fidelityand surety companies, as set out in subdivision (4) of this section where itscharter so permits, and when and so long as it meets and thereafter maintains aminimum capital and surplus equal to the sum of the minimum capital and surplusrequirements of this subdivision and the minimum capital and surplusrequirements of subdivision (4) of this section.
(4) Stock Casualty andFidelity and Surety Companies. A stock corporation may be organized in themanner prescribed in this Chapter and licensed to do one or more of the kindsof insurance specified in G.S. 58‑7‑15 (3), (6), (7), (8), (9),(10), (11), (12), (13), (14), (15), (16), (17), (18), (19), (21), (22), and(23) only when it has a paid‑in capital of not less than one milliondollars ($1,000,000) and a paid‑in initial surplus of not less than onemillion five hundred thousand dollars ($1,500,000). Every such company shall atall times thereafter maintain a minimum capital of not less than one milliondollars ($1,000,000) and a minimum surplus of at least two hundred fiftythousand dollars ($250,000).
(5) Mutual Fire andMarine Companies.
a. Limited assessmentcompanies. A limited assessment mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more kinds of insurancespecified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11), (12),(19), (20), (21) and (22) only when it has no less than five hundred thousanddollars ($500,000) of insurance in not fewer than 500 separate risks subscribedwith a paid‑in initial surplus of at least three hundred thousand dollars($300,000), which surplus shall at all times be maintained. The assessmentliability of a policyholder of a company organized in accordance with theprovisions of this sub‑subdivision shall not be limited to less than fiveannual premiums; provided, the limited assessment company may reduce theassessment liability of its policyholders from such five annual premiums to oneadditional annual premium when the free surplus of the company amounts to notless than three hundred thousand dollars ($300,000), which surplus shall at alltimes be maintained.
b. Assessable mutualcompanies. An assessable mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5) and (6), with anunlimited assessment liability of its policyholders only when it has not lessthan five hundred thousand dollars ($500,000) of insurance in not fewer than500 separate risks subscribed with a paid‑in initial surplus equal totwice the amount of the maximum net retained liability under the largest policyof insurance issued by the company; but not less than sixty thousand dollars($60,000); which surplus shall at all times be maintained. Provided thecompany, when its charter so permits, in addition may be licensed to do one ormore of the kinds of insurance specified in G.S. 58‑7‑15 (7), (8),(11), (12), (19), (20), (21) and (22), with an unlimited assessment liabilityof its policyholders, when its free surplus amounts to not less than sixtythousand dollars ($60,000), which surplus shall at all times be maintained.
c. Nonassessable mutualcompanies. A nonassessable mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11),(12), (19), (20), (21) and (22) and may be authorized to issue policies underthe terms of which a policyholder is not liable for any assessments in additionto the premium set out in the policy only when it has not less than fivehundred thousand dollars ($500,000) of insurance in not fewer than 500 separaterisks subscribed with a paid‑in initial surplus of not less than eighthundred thousand dollars ($800,000), which surplus shall at all times bemaintained.
d. Town or countymutual insurance companies. A town or county mutual insurance company withunlimited assessment liability may be organized in the manner prescribed inthis Chapter and licensed to do the kinds of insurance specified in G.S. 58‑7‑15(4)only when it has not less than fifty thousand dollars ($50,000) of insurance inforce in not fewer than 50 separate risks subscribed with a paid‑ininitial surplus of not less than fifteen thousand dollars ($15,000), whichsurplus shall at all times be maintained. A town or county mutual insurancecompany may, in addition to writing the business specified in G.S. 58‑7‑15(4)cover in the same policy the hazards usually insured against under an extendedcoverage endorsement when the company has not less than five hundred thousanddollars ($500,000) of insurance in force in not fewer than 500 separate risksand maintains a surplus at all times of not less than one hundred twentythousand dollars ($120,000): Provided, that the company may not operate in morethan six adjacent counties in this State. Any company authorized under thissection before July 1, 1991, shall be permitted to continue to do the samekinds of business that it was authorized to do prior to July 1, 1991, withoutbeing required to increase its surplus; however, the insurer shall increase itssurplus to the required amounts on or before July 1, 1992. The requirements ofthis sub‑subdivision as to surplus shall apply to such companies as aprerequisite to writing additional lines of business, and to such companies asa prerequisite to commencing business if unlicensed prior to July 1, 1991.
(6) Mutual Life,Accident and Health Insurance Companies. A nonassessable mutual insurancecompany may be organized in the manner prescribed in this Chapter, and licensedto do only one or more of the kinds of insurance specified in G.S. 58‑7‑15(1), (2) and (3) when it has complied with the requirements of this Chapter andwith those set forth in sub‑subdivisions a through d of this subdivision,inclusive, whichever shall be applicable.
a. If organized to doonly the kinds of insurance specified in G.S. 58‑7‑15 (1) and (2)the company shall have not less than 500 bona fide applications for lifeinsurance in an aggregate amount not less than five hundred thousand dollars($500,000), and shall have received from each such applicant in cash the fullamount of one annual premium on the policy for which the applicant applied, inan aggregate amount at least equal to ten thousand dollars ($10,000), and shallin addition have a paid‑in initial surplus of two hundred thousanddollars ($200,000), and shall have and maintain at all times a minimum surplusof one hundred thousand dollars ($100,000).
b. If organized to doonly the kind of insurance specified in paragraph a of G.S. 58‑7‑15(3)the company shall have not less than 250 bona fide applications for thatinsurance, and shall have received from each applicant in cash the full amountof one annual premium on the policy for which the applicant applied, in anaggregate amount of at least ten thousand dollars ($10,000), and shall have apaid‑in initial surplus of two hundred thousand dollars ($200,000) andshall have and maintain at all times a minimum surplus of one hundred thousanddollars ($100,000).
c. If organized to dothe kinds of insurance specified in G.S. 58‑7‑15 (1) and (3)a, thecompany shall have complied with the provisions of sub‑subdivisions a andb of this subdivision.
d. If organized to dothe kind of insurance specified in G.S. 58‑7‑15(3)b, in addition tothe kind or kinds of insurance designated in any one of the preceding sub‑subdivisionsof this subdivision, the company shall have a paid‑in initial surplus ofat least five hundred thousand dollars ($500,000) and shall maintain a minimumsurplus of at least three hundred thousand dollars ($300,000).
(7) Organization ofMutual Casualty, Fidelity and Surety Companies.
a. Nonassessable,mutual companies. A mutual insurance company with no assessment liabilityprovided for its policyholders may be organized in the manner prescribed inthis Chapter and licensed to do one or more of the kinds of insurance specifiedin G.S. 58‑7‑15 (3), (6), (7), (8), (9), (10), (11), (12), (13),(14), (15), (16), (17), (18), (19), (21) and (22) when it has a minimum paid‑ininitial surplus of one million dollars ($1,000,000) and not less than fivehundred thousand dollars ($500,000) in insurance subscribed in not less than500 separate risks. The surplus of the company shall at all times be maintainedat or above that amount.
b. Assessable mutualcompanies. A mutual insurance company with assessment liability provided forits policyholders may be organized in the manner prescribed in this Chapter andlicensed to do one or more of the kinds of insurance specified in G.S. 58‑7‑15(3), (6), (7), (8), (9), (10), (11), (12), (13), (14), (15), (16), (17), (18),(19), (21) and (22) when it has a minimum paid‑in initial surplus of fourhundred thousand dollars ($400,000) and not less than five hundred thousanddollars ($500,000) of insurance subscribed in not less than 500 separate risks.The company shall at all times maintain a surplus in an amount not less thanfour hundred thousand dollars ($400,000). The assessment liability of apolicyholder of the company shall not be limited to less than one annualpremium.
(8) Organization ofMutual Multiple Line Companies.
a. Assessable mutualcompanies. A company may do all the kinds of insurance authorized to be doneby a company organized under the provisions of sub‑subdivision (5)a, andsub‑subdivision (7)b of this subdivision, where its charter so permitswhen and if it meets the combined minimum requirements of those sub‑subdivisions.The assessment liability of policyholders of such a company shall not belimited to less than one annual premium within any one policy year.
b. Nonassessable mutualcompanies. A company may do all the kinds of insurance authorized to be doneby a company organized under the provisions of sub‑subdivision (5)c, andsub‑subdivision (7)a of this subdivision, where its charter so permitswhen and if it meets the combined minimum requirements of those paragraphs. Thepolicyholders of such a company shall not be subject to any assessment liability.
(9) Repealed by SessionLaws 1991, c. 644, s. 32.
(10) Impairment of Capitaland/or Surplus. Whenever the Commissioner finds from a financial statementmade by any company, or from a report of examination of any company, that itsadmitted assets are less than the aggregate amount of its liabilities and itsoutstanding capital stock, required minimum surplus, or both, the Commissionershall determine, in accordance with G.S. 58‑2‑165 and otherapplicable provisions of this Chapter, the amount of the impairment of capital,surplus, or both and issue an order in writing requiring the company toeliminate the impairment within such period of not more than 90 days as theCommissioner shall designate. The Commissioner may, by order served upon thecompany, prohibit the company from issuing any new policies while theimpairment exists. If at the expiration of the designated period the companyhas not satisfied the Commissioner that the impairment has been eliminated, anorder for the rehabilitation or liquidation of the company may be entered asprovided in Article 30 of this Chapter.
(11) The Commissioner mayrequire an insurer to have and maintain a larger amount of capital or surplusthan prescribed in this section, based upon the volume and kinds of insurancetransacted by the insurer and on the principles of risk‑based capital asdetermined by the NAIC or the Commissioner. (1899, c. 54, s. 26; 1903, c. 438, s. 4; Rev., s.4729; 1907, c. 1000, s. 5; 1913, c. 140, s. 2; C.S., s. 6332; 1929, c. 284, s.1; 1945, c. 386; 1947, c. 721; 1963, c. 943; 1965, c. 947; 1967, c. 300; 1971,c. 536; 1973, c. 686; 1979, c. 421, s. 1; 1983, c. 472; 1985, c. 666, s. 75;1985 (Reg. Sess., 1986), c. 1013, s. 10; 1989, c. 485, s. 53; 1991, c. 644, s.32; c. 681, s. 27; 1995, c. 193, s. 17; 2001‑223, s. 5.1; 2007‑127,s. 4; 2008‑124, s. 2.6.)
§ 58‑7‑75. Amountof capital and/or surplus required; impairment of capital or surplus.
The amount of capital and/orsurplus requisite to the formation and organization of companies under theprovisions of Articles 1 through 64 of this Chapter shall be as follows:
(1) Stock Life InsuranceCompanies. A stock corporation may be organized in the manner prescribed inthis Chapter and licensed to do the business of life insurance, only when ithas paid‑in capital of at least six hundred thousand dollars ($600,000)and a paid‑in initial surplus of at least nine hundred thousand dollars($900,000), and it may in addition do the kind of business specified in G.S. 58‑7‑15(2),without having additional capital or surplus. Every such company shall at alltimes thereafter maintain a minimum capital of not less than six hundredthousand dollars ($600,000) and a minimum surplus of at least one hundred fiftythousand dollars ($150,000). Provided that, any such corporation may do eitheror both of the kinds of insurance authorized for stock accident and healthinsurance companies, as set out in G.S. 58‑7‑15(3)a. and b., whereits charter so permits, and only as long as it maintains a minimum capital andsurplus equal to the sum of the minimum capital and surplus requirements ofthis subdivision and the minimum capital and surplus requirements ofsubdivision (2) of this section.
(1a) Non‑Stock LifeInsurance Companies. A nonstock corporation, not inclusive of a corporationorganized pursuant to subdivision (6) of this section, may be organized in themanner prescribed in this Chapter and licensed to do the business of lifeinsurance, only when it has a paid in initial surplus of at least one millionfive hundred thousand dollars ($1,500,000) and it may in addition do the kindof business specified in G.S. 58‑7‑15(2), without having additionalsurplus. Every such corporation shall at all times thereafter maintain aminimum surplus of at least seven hundred fifty thousand dollars ($750,000).Provided that, any such corporation may conduct the kind of insuranceauthorized for stock accident and health insurance companies, as set out inG.S. 58‑7‑15(3)a. and b., where its charter so permits, and only aslong as it maintains a minimum surplus equal to the sum of the minimum surplusrequirements of this subdivision and the minimum surplus requirements ofsubdivision (2a) of this section.
(2) Stock Accident andHealth Insurance Companies.
a. A stock corporationmay be organized in the manner prescribed in this Chapter and licensed to doonly the kind of insurance specified in G.S. 58‑7‑15(3)a, when ithas paid‑in capital of not less than four hundred thousand dollars($400,000), and a paid‑in initial surplus of at least six hundredthousand dollars ($600,000). Every such company shall at all times thereaftermaintain a minimum capital of not less than four hundred thousand dollars($400,000) and a minimum surplus of at least one hundred thousand dollars($100,000).
b. Any companyorganized under the provisions of paragraph a of this subdivision may, by theprovisions of its original charter or any amendment thereto, acquire the powerto do the kind of business specified in G.S. 58‑7‑15(3)b, if it hasa paid‑in capital of at least six hundred thousand dollars ($600,000) anda paid‑in initial surplus of at least nine hundred thousand dollars($900,000). Every such company shall at all times maintain a minimum capital ofnot less than six hundred thousand dollars ($600,000) and a minimum surplus ofat least one hundred fifty thousand dollars ($150,000).
(2a) Non‑StockAccident and Health Insurance Companies.
a. A non‑stockcorporation, not inclusive of a corporation organized pursuant to subdivision(6) of this section, may be organized in the manner prescribed in this Chapterand licensed to do only the kind of insurance specified in G.S. 58‑7‑15(3)a.when it has a paid in initial surplus of at least one million dollars($1,000,000). Every such corporation shall at all times thereafter maintain aminimum surplus of at least five hundred thousand dollars ($500,000).
b. Any non‑stockcorporation organized under the provisions of sub‑subdivision a. of thissubdivision may, by the provisions of its original charter or any amendmentthereto, acquire the power to do the kind of business specified in G.S. 58‑7‑15(3)b.,if it has a paid‑in initial surplus of at least one million five hundredthousand dollars ($1,500,000). Every such corporation shall at all timesmaintain a minimum surplus of at least seven hundred fifty thousand dollars($750,000).
(3) Stock Fire andMarine Companies. A stock corporation may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11),(12), (19), (20), (21) and (22) only when it has a paid‑in capital of notless than eight hundred thousand dollars ($800,000) and a paid‑in initialsurplus of not less than one million two hundred thousand dollars ($1,200,000).Every such company shall at all times thereafter maintain a minimum capital ofnot less than eight hundred thousand dollars ($800,000) and a minimum surplusof at least two hundred thousand dollars ($200,000). Provided that, any suchcorporation may do all the kinds of insurance authorized for casualty, fidelityand surety companies, as set out in subdivision (4) of this section where itscharter so permits, and when and so long as it meets and thereafter maintains aminimum capital and surplus equal to the sum of the minimum capital and surplusrequirements of this subdivision and the minimum capital and surplusrequirements of subdivision (4) of this section.
(4) Stock Casualty andFidelity and Surety Companies. A stock corporation may be organized in themanner prescribed in this Chapter and licensed to do one or more of the kindsof insurance specified in G.S. 58‑7‑15 (3), (6), (7), (8), (9),(10), (11), (12), (13), (14), (15), (16), (17), (18), (19), (21), (22), and(23) only when it has a paid‑in capital of not less than one milliondollars ($1,000,000) and a paid‑in initial surplus of not less than onemillion five hundred thousand dollars ($1,500,000). Every such company shall atall times thereafter maintain a minimum capital of not less than one milliondollars ($1,000,000) and a minimum surplus of at least two hundred fiftythousand dollars ($250,000).
(5) Mutual Fire andMarine Companies.
a. Limited assessmentcompanies. A limited assessment mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more kinds of insurancespecified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11), (12),(19), (20), (21) and (22) only when it has no less than five hundred thousanddollars ($500,000) of insurance in not fewer than 500 separate risks subscribedwith a paid‑in initial surplus of at least three hundred thousand dollars($300,000), which surplus shall at all times be maintained. The assessmentliability of a policyholder of a company organized in accordance with theprovisions of this sub‑subdivision shall not be limited to less than fiveannual premiums; provided, the limited assessment company may reduce theassessment liability of its policyholders from such five annual premiums to oneadditional annual premium when the free surplus of the company amounts to notless than three hundred thousand dollars ($300,000), which surplus shall at alltimes be maintained.
b. Assessable mutualcompanies. An assessable mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5) and (6), with anunlimited assessment liability of its policyholders only when it has not lessthan five hundred thousand dollars ($500,000) of insurance in not fewer than500 separate risks subscribed with a paid‑in initial surplus equal totwice the amount of the maximum net retained liability under the largest policyof insurance issued by the company; but not less than sixty thousand dollars($60,000); which surplus shall at all times be maintained. Provided thecompany, when its charter so permits, in addition may be licensed to do one ormore of the kinds of insurance specified in G.S. 58‑7‑15 (7), (8),(11), (12), (19), (20), (21) and (22), with an unlimited assessment liabilityof its policyholders, when its free surplus amounts to not less than sixtythousand dollars ($60,000), which surplus shall at all times be maintained.
c. Nonassessable mutualcompanies. A nonassessable mutual company may be organized in the mannerprescribed in this Chapter and licensed to do one or more of the kinds ofinsurance specified in G.S. 58‑7‑15 (4), (5), (6), (7), (8), (11),(12), (19), (20), (21) and (22) and may be authorized to issue policies underthe terms of which a policyholder is not liable for any assessments in additionto the premium set out in the policy only when it has not less than fivehundred thousand dollars ($500,000) of insurance in not fewer than 500 separaterisks subscribed with a paid‑in initial surplus of not less than eighthundred thousand dollars ($800,000), which surplus shall at all times bemaintained.
d. Town or countymutual insurance companies. A town or county mutual insurance company withunlimited assessment liability may be organized in the manner prescribed inthis Chapter and licensed to do the kinds of insurance specified in G.S. 58‑7‑15(4)only when it has not less than fifty thousand dollars ($50,000) of insurance inforce in not fewer than 50 separate risks subscribed with a paid‑ininitial surplus of not less than fifteen thousand dollars ($15,000), whichsurplus shall at all times be maintained. A town or county mutual insurancecompany may, in addition to writing the business specified in G.S. 58‑7‑15(4)cover in the same policy the hazards usually insured against under an extendedcoverage endorsement when the company has not less than five hundred thousanddollars ($500,000) of insurance in force in not fewer than 500 separate risksand maintains a surplus at all times of not less than one hundred twentythousand dollars ($120,000): Provided, that the company may not operate in morethan six adjacent counties in this State. Any company authorized under thissection before July 1, 1991, shall be permitted to continue to do the samekinds of business that it was authorized to do prior to July 1, 1991, withoutbeing required to increase its surplus; however, the insurer shall increase itssurplus to the required amounts on or before July 1, 1992. The requirements ofthis sub‑subdivision as to surplus shall apply to such companies as aprerequisite to writing additional lines of business, and to such companies asa prerequisite to commencing business if unlicensed prior to July 1, 1991.
(6) Mutual Life,Accident and Health Insurance Companies. A nonassessable mutual insurancecompany may be organized in the manner prescribed in this Chapter, and licensedto do only one or more of the kinds of insurance specified in G.S. 58‑7‑15(1), (2) and (3) when it has complied with the requirements of this Chapter andwith those set forth in sub‑subdivisions a through d of this subdivision,inclusive, whichever shall be applicable.
a. If organized to doonly the kinds of insurance specified in G.S. 58‑7‑15 (1) and (2)the company shall have not less than 500 bona fide applications for lifeinsurance in an aggregate amount not less than five hundred thousand dollars($500,000), and shall have received from each such applicant in cash the fullamount of one annual premium on the policy for which the applicant applied, inan aggregate amount at least equal to ten thousand dollars ($10,000), and shallin addition have a paid‑in initial surplus of two hundred thousanddollars ($200,000), and shall have and maintain at all times a minimum surplusof one hundred thousand dollars ($100,000).
b. If organized to doonly the kind of insurance specified in paragraph a of G.S. 58‑7‑15(3)the company shall have not less than 250 bona fide applications for thatinsurance, and shall have received from each applicant in cash the full amountof one annual premium on the policy for which the applicant applied, in anaggregate amount of at least ten thousand dollars ($10,000), and shall have apaid‑in initial surplus of two hundred thousand dollars ($200,000) andshall have and maintain at all times a minimum surplus of one hundred thousanddollars ($100,000).
c. If organized to dothe kinds of insurance specified in G.S. 58‑7‑15 (1) and (3)a, thecompany shall have complied with the provisions of sub‑subdivisions a andb of this subdivision.
d. If organized to dothe kind of insurance specified in G.S. 58‑7‑15(3)b, in addition tothe kind or kinds of insurance designated in any one of the preceding sub‑subdivisionsof this subdivision, the company shall have a paid‑in initial surplus ofat least five hundred thousand dollars ($500,000) and shall maintain a minimumsurplus of at least three hundred thousand dollars ($300,000).
(7) Organization ofMutual Casualty, Fidelity and Surety Companies.
a. Nonassessable,mutual companies. A mutual insurance company with no assessment liabilityprovided for its policyholders may be organized in the manner prescribed inthis Chapter and licensed to do one or more of the kinds of insurance specifiedin G.S. 58‑7‑15 (3), (6), (7), (8), (9), (10), (11), (12), (13),(14), (15), (16), (17), (18), (19), (21) and (22) when it has a minimum paid‑ininitial surplus of one million dollars ($1,000,000) and not less than fivehundred thousand dollars ($500,000) in insurance subscribed in not less than500 separate risks. The surplus of the company shall at all times be maintainedat or above that amount.
b. Assessable mutualcompanies. A mutual insurance company with assessment liability provided forits policyholders may be organized in the manner prescribed in this Chapter andlicensed to do one or more of the kinds of insurance specified in G.S. 58‑7‑15(3), (6), (7), (8), (9), (10), (11), (12), (13), (14), (15), (16), (17), (18),(19), (21) and (22) when it has a minimum paid‑in initial surplus of fourhundred thousand dollars ($400,000) and not less than five hundred thousanddollars ($500,000) of insurance subscribed in not less than 500 separate risks.The company shall at all times maintain a surplus in an amount not less thanfour hundred thousand dollars ($400,000). The assessment liability of apolicyholder of the company shall not be limited to less than one annualpremium.
(8) Organization ofMutual Multiple Line Companies.
a. Assessable mutualcompanies. A company may do all the kinds of insurance authorized to be doneby a company organized under the provisions of sub‑subdivision (5)a, andsub‑subdivision (7)b of this subdivision, where its charter so permitswhen and if it meets the combined minimum requirements of those sub‑subdivisions.The assessment liability of policyholders of such a company shall not belimited to less than one annual premium within any one policy year.
b. Nonassessable mutualcompanies. A company may do all the kinds of insurance authorized to be doneby a company organized under the provisions of sub‑subdivision (5)c, andsub‑subdivision (7)a of this subdivision, where its charter so permitswhen and if it meets the combined minimum requirements of those paragraphs. Thepolicyholders of such a company shall not be subject to any assessment liability.
(9) Repealed by SessionLaws 1991, c. 644, s. 32.
(10) Impairment of Capitaland/or Surplus. Whenever the Commissioner finds from a financial statementmade by any company, or from a report of examination of any company, that itsadmitted assets are less than the aggregate amount of its liabilities and itsoutstanding capital stock, required minimum surplus, or both, the Commissionershall determine, in accordance with G.S. 58‑2‑165 and otherapplicable provisions of this Chapter, the amount of the impairment of capital,surplus, or both and issue an order in writing requiring the company toeliminate the impairment within such period of not more than 90 days as theCommissioner shall designate. The Commissioner may, by order served upon thecompany, prohibit the company from issuing any new policies while theimpairment exists. If at the expiration of the designated period the companyhas not satisfied the Commissioner that the impairment has been eliminated, anorder for the rehabilitation or liquidation of the company may be entered asprovided in Article 30 of this Chapter.
(11) The Commissioner mayrequire an insurer to have and maintain a larger amount of capital or surplusthan prescribed in this section, based upon the volume and kinds of insurancetransacted by the insurer and on the principles of risk‑based capital asdetermined by the NAIC or the Commissioner. (1899, c. 54, s. 26; 1903, c. 438, s. 4; Rev., s.4729; 1907, c. 1000, s. 5; 1913, c. 140, s. 2; C.S., s. 6332; 1929, c. 284, s.1; 1945, c. 386; 1947, c. 721; 1963, c. 943; 1965, c. 947; 1967, c. 300; 1971,c. 536; 1973, c. 686; 1979, c. 421, s. 1; 1983, c. 472; 1985, c. 666, s. 75;1985 (Reg. Sess., 1986), c. 1013, s. 10; 1989, c. 485, s. 53; 1991, c. 644, s.32; c. 681, s. 27; 1995, c. 193, s. 17; 2001‑223, s. 5.1; 2007‑127,s. 4; 2008‑124, s. 2.6.)
