Georgia House of Representatives - 1995/1996 Sessions

HB 431 - Insurance; capital stock and surplus; revise requirements

Page Numbers - 1/ 2/ 3

Code Sections - 33-3-6/ 33-3-7

1. Culbreth  132nd        2. Lord  121st


House Comm: Ins        /                Senate Comm: I&L        /               
House Vote: Yeas 165   Nays 0           Senate Vote: Yeas 46  Nays 0            
              ----------------------------------------                          
               House          Action         Senate                             
              ----------------------------------------                          
              1/26/95  Read 1st Time         2/6/95                             
              1/27/95  Read 2nd Time         2/17/95                            
              2/1/95   Favorably Reported    2/16/95                            
              Am       Committee Amend/Sub                                      
              2/3/95   Read 3rd Time         3/9/95                             
              2/3/95   Passed/Adopted        3/9/95                             
              CA       Comm/Floor Amend/Sub                                     
              4/3/95   Sent to Governor                                         
              4/18/95  Signed by Governor                                       
              334      Act/Veto Number                                          
              7/1/95   Effective Date                                           
              ----------------------------------------                          
                                                                                
Code Sections amended: 33-3-6, 33-3-7                                           


HB 431                                             HB 431/CA

      H. B. No. 431 (AM)
      By:  Representatives Culbreth of the 132nd and Lord of the
      121st


                        A BILL TO BE ENTITLED
                               AN ACT


  1- 1  To amend Chapter 3 of Title 33 of the Official Code of
  1- 2  Georgia Annotated, relating to authorization and general
  1- 3  requirements for the transaction of insurance, so as to
  1- 4  revise the requirements of the amount of capital stock or
  1- 5  surplus necessary for authorization to transact insurance in
  1- 6  this state; to revise requirements for additional surplus of
  1- 7  newly admitted insurers and to require the maintenance of
  1- 8  such surplus; to provide for matters relative to the
  1- 9  foregoing; to repeal conflicting laws; and for other
  1-10  purposes.

  1-11       BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:

                         SECTION 1.

  1-12  Chapter 3 of Title 33 of the Official Code of Georgia
  1-13  Annotated, relating to authorization and general
  1-14  requirements for the transaction of insurance, is amended by
  1-15  striking Code Section 33-3-6, relating to requirements as to
  1-16  capital stock or surplus generally, and inserting in its
  1-17  place a new Code Section 33-3-6 to read as follows:

  1-18    "33-3-6. (Index)

  1-19      (a)(1) On or after January 1, 1991 July 1, 1995, to
  1-20      qualify for an original certificate of authority to
  1-21      transact one or more classes of insurance, an insurer
  1-22      shall possess and thereafter maintain a minimum of $1.5
  1-23      million in capital stock, if a stock insurer, or in
  1-24      surplus, if a mutual or reciprocal insurer.

  1-25      (2) Notwithstanding the requirements of paragraph (1) of
  1-26      this subsection, for the purposes of subsection (d) of
  1-27      Code Section 33-7-14, the minimum capital requirement of
  1-28      reinsurers approved by the Commissioner pursuant to Code
  1-29      Section 33-7-14 shall be $200,000.00.

  1-30    (b) As to surplus required for initial qualification to
  1-31    transact one kind of insurance and thereafter to be
  1-32    maintained, domestic mutual insurers shall be governed by


                             H. B. No. 431
                                 -1- (Index)

                                                   HB 431/CA

  2- 1    Chapter 14 of this title and domestic reciprocal insurers
  2- 2    shall be governed by Chapter 17 of this title.  Hospital
  2- 3    service nonprofit corporations and nonprofit medical
  2- 4    service corporations shall be governed by Chapters 19 and
  2- 5    18 of this title, respectively. Farmers' mutual fire
  2- 6    insurance companies shall be governed by Chapter 16 of
  2- 7    this title. 

  2- 8    (c) Except as otherwise provided by law, the Commissioner
  2- 9    may, in his discretion, grant an extension of up to two
  2-10    years to any insurer which has been issued a minimum of
  2-11    two successive certificates of authority prior to July 1,
  2-12    1992, and is operating in a responsible financial manner
  2-13    to meet the requirements of Code Sections 33-3-6 and
  2-14    33-3-7.  The authority granted by this Code section to the
  2-15    Commissioner shall terminate on January 1, 1995."

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  2-16  Said chapter is further amended by striking Code Section
  2-17  33-3-7, relating to the requirement of surplus for new
  2-18  insurers, and inserting a new Code Section 33-3-7 to read as
  2-19  follows:

  2-20    "33-3-7. (Index)

  2-21    (a) In addition to the minimum paid-in capital of stock
  2-22    insurers or minimum surplus of mutual and reciprocal
  2-23    insurers required by this title, an insurer shall possess
  2-24    when first authorized in this state and thereafter
  2-25    maintain surplus or additional surplus equal to the larger
  2-26    of $1.5 million if a (stock, mutual, and or recipr
  2-27    insurers) insurer or 50 percent of its paid-in capital
  2-28    stock (if a stock insurer) or of its surplus (if a mutual
  2-29    or reciprocal insurer) otherwise required under Code
  2-30    Section 33-3-6 for the kinds of insurance to be
  2-31    transacted. 

  2-32    (b) Except as otherwise provided by law, the Commissioner
  2-33    may, in his discretion, grant an extension of up to two
  2-34    years to any insurer which has been issued a minimum of
  2-35    two successive certificates of authority by any other
  2-36    state prior to July 1, 1992, and is operating in a
  2-37    responsible financial manner to meet the requirements of
  2-38    this Code section.  The authority granted by this
  2-39    subsection to the Commissioner shall terminate on January
  2-40    1, 1995."

                         SECTION 3.


                             H. B. No. 431
                                 -2- (Index)

                                                   HB 431/CA

  3- 1  All laws and parts of laws in conflict with this Act are
  3- 2  repealed.













































                             H. B. No. 431
                                 -3- (Index)