By:  Wentworth                                        S.B. No. 1598
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the reorganization of a mutual life insurance company.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Article 11.01, Insurance Code, is amended by
 1-5     adding Section 3 to read as follows:
 1-6           Sec.  3.  (a)  Subject to Article 15.22 of this code, a
 1-7     mutual life insurance company organized or operating under the
 1-8     provisions of this chapter may reorganize by forming an insurance
 1-9     holding company based on a mutual plan and continuing the corporate
1-10     existence of the reorganizing mutual life insurance company as a
1-11     stock insurance company if the commissioner determines that the
1-12     reorganization is fair and equitable to the policyholders of the
1-13     company and approves the proposed plan of reorganization.
1-14           (b)  The commissioner shall retain jurisdiction over a
1-15     company that is reorganized under this section.
1-16           (c)  A mutual holding company that results from a
1-17     reorganization of a domestic mutual life insurance company
1-18     organized under this chapter must be incorporated under the
1-19     provisions of this code and the Texas Non-Profit Corporation Act
1-20     (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).  The
1-21     articles of incorporation of the mutual holding company and any
1-22     amendments to the articles of incorporation are subject to approval
1-23     by the commissioner.
1-24           (d)  A sale, issuance, or offering of securities under this
1-25     section is exempt from the registration and licensing provisions of
 2-1     The Securities Act (Article 581-1 et seq., Vernon's Texas Civil
 2-2     Statutes).  An officer, director, or employee who participates in a
 2-3     reorganization under this section is exempt from the registration
 2-4     and licensing provisions of The Securities Act (Article 581-1 et
 2-5     seq., Vernon's Texas Civil Statutes).  A person may not be
 2-6     compensated for services performed under the exemption provided by
 2-7     this section.
 2-8           SECTION 2.  This Act takes effect September 1, 2001.