CHAPTER 5. County Mutual Fire Insurers [5050. - 7060.]

Chapter 5 enacted by Stats. 1935, Ch. 145.

§§ 5050–7060 · 81 sections

ARTICLE 1. Formation and Organization §§ 5050–5063 · 16 sections
- § 5050 Two hundred fifty (250) or more persons residing in one county of this State may incorporate for the purpose of forming a mutual fire insurer upon all such…
- § 5050.1 If such persons have not performed all acts and secured all agreements necessary to complete the incorporation of such insurer within one year from the date of…
- § 5050.5 Any county mutual fire insurer heretofore or hereafter incorporated and doing business under the provisions of this chapter may, if it has issued an insurance…
- § 5051 Upon the payment in advance of seven thousand fifty-five dollars ($7,055) to the commissioner for all services to be rendered by him or her in the matter of…
- § 5052 The commissioner shall examine the proposed articles of incorporation. If they conform to this chapter he shall deliver to such persons a certificate…
- § 5053 The duly executed articles of incorporation and a copy of the certificate of the commissioner shall be filed with the Secretary of State in conformity with…
- § 5054 The articles of incorporation and certificate obtained by any county mutual fire insurer operating under the provisions of this chapter are subject to control…
- § 5055 The by-laws and all amendments thereto shall be filed with the commissioner within sixty days after their adoption.
- § 5056 Such insurer shall have not less than seven, nor more than 11 directors, a majority of whom shall constitute a quorum to do business. The by-laws or the…
- § 5057 The annual meeting of the members of the insurer shall be held on the second Monday of February of each year, unless its board of directors fixes the time for…
- § 5058 In the election of the first board of directors each member shall be entitled to one vote. At every subsequent election each member shall be entitled to as…
- § 5059 A member may cast his votes in person or by proxy, distributing them among the directors to be elected, or among a less number of the directors, or cumulating…
- § 5060 The directors shall elect, from their own number, a president and a vice president. They shall also elect a treasurer and a secretary, who need not be members…
- § 5061 The treasurer and secretary shall give bonds to the insurer for the faithful performance of their duties, in such amounts as are prescribed by the board of…
- § 5062 No incorporators or persons acting in their behalf or other persons participating in the management of such insurer shall advance to or for the subscribers or…
- § 5063 No such insurer may enter into any general agency or management contract whereby it authorizes or delegates to a person the right to assume virtual control of…
ARTICLE 2. Powers §§ 5080–5081 · 2 sections
- § 5080 Such insurer and its directors possess the usual powers, and are subject to the usual duties of corporations and directors.
- § 5081 Such insurer may accumulate such surplus as its directors deem desirable for meeting contingencies, to cover the catastrophe hazard, and for general corporate…
ARTICLE 3. Membership §§ 5090–5094 · 6 sections
- § 5090 Any person having an insurable interest in property in the county in which any such insurer is formed or any person having such an interest in property in any…
- § 5090.2 Not more than one person licensed as an insurance agent, broker or solicitor, or who is a member of an association or partnership or a stockholder or employee…
- § 5091 Any member of such insurer may commence to withdraw therefrom by surrendering his policy for cancellation, and by giving notice in writing to the secretary at…
- § 5092 The withdrawal may be completed by paying the member’s share, if any, under the terms of his policy, of all claims that exist against the insurer on the day of…
- § 5093 The insurer may cancel any policy by giving the insured 20 days’ written notice of cancellation with or without tender of the excess of paid premium above the…
- § 5094 In case of cancellation by the insurer it shall also notify in the same manner any holder of a mortgage whose name appears, either on the signed application…
ARTICLE 4. The Policy §§ 6010–6021 · 16 sections
- § 6010 (a) The following is adopted as the standard form of county mutual fire insurer’s policy for this state: California Standard Form of County Fire Insurance…
- § 6010.5 The policy is not required to be used for reinsurance between insurers.
- § 6011 Either the blanks in the standard form or those in an endorsement attached thereto shall be appropriately filled. The first page of the policy or an…
- § 6011.5 In lieu of showing the term of coverage in the form set forth in Section 6010, the standard form policy may show the term in any form which clearly states the…
- § 6011.6 In lieu of the attestation clause and official signatures in the form as set forth in Section 6010, the standard form policy may show, immediately following…
- § 6012 By special agreement indorsed on the policy or added thereto, the provisions regarding appraisement or apportionment of loss may be waived and the valuations…
- § 6013 The standard form of policy shall be plainly printed. The type shall not be smaller than eight-point and in a style not less legible than Century and subheads…
- § 6014 All county mutual fire insurance policies on subject matter in this State shall be on the county mutual standard form and, except as provided by this article,…
- § 6015 The insurer may add to the policy any matter relating to its financial condition, directors, officers, members and history, and the address of its home office…
- § 6016 Clauses may be added to the policy providing for and defining the rights, duties and obligations of mortgagees, assignees, and other parties having an interest…
- § 6017 Insurers authorized to limit or eliminate their assessment liability in accordance with the terms of this chapter may make such changes in the standard form as…
- § 6017.5 Insurers authorized to eliminate their assessment liability in accordance with the terms of this chapter may use the California standard form insurance policy…
- § 6018 No clause shall be inserted nor rider attached affecting the standard form liability of the insurer for loss or damage by fire occasioned either directly or…
- § 6019 Clauses may be added to the policy: (a) Covering property and risks not otherwise covered; provided that clauses covering loss or damage caused by nuclear…
- § 6020 Except as otherwise provided by this article, clauses may be attached, by separate riders in type larger than pica or in capital letters measuring not less…
- § 6021 It is a misdemeanor for any insurer or its agent to countersign or issue a county mutual fire insurance policy covering in whole or part subject-matter in this…
ARTICLE 5. Risks §§ 6040–6050 · 11 sections
- § 6040 Such insurer may issue policies on dwellings, schoolhouses, churches, fraternal or lodge halls, community, creamery, or farm buildings and property contained…
- § 6040.5 Insurers authorized to eliminate their assessment liability in accordance with the terms of this chapter (commencing with Section 5050) shall not be restricted…
- § 6041 Insurance permitted by this chapter upon personal property owned by the insured, including automobiles and livestock, shall continue in full force and effect…
- § 6042 Policies may be executed for any time not exceeding five years and not extending beyond the time limited for the existence of the insurer.
- § 6043 All members of such an insurer shall agree in writing to pay their pro rata share to the insurer of the necessary expense and loss sustained by any member…
- § 6044 All such insurers shall classify the subject matter insured by them at the time of issuing policies thereon. Such classification shall be under rates…
- § 6045 For the purpose of this chapter: (a) “A city or town block” is an area of not more than one hundred sixty thousand square feet having at least one frontage in…
- § 6047 Except as provided in this section, such insurer shall not issue policies to an amount in excess of six thousand dollars ($6,000) on any one risk, whether…
- § 6048 Except as provided in Section 6041 such insurer shall insure only property within the limits of the county wherein it is organized, or in a county next…
- § 6049 Such an insurer shall not assume any risks on property situated within any one block of a closely built-up district or of territory within the limit of any…
- § 6050 Where the amount of insurance in policies already written equals the amount limited by the provisions of this article, no additional insurance shall be written…
ARTICLE 6. Reinsurance §§ 6070–6072 · 3 sections
- § 6070 Any such insurer may accept reinsurance under any agreement for reinsurance between two or more county mutual fire insurers or from any authorized insurer the…
- § 6071 Any such insurer may cede reinsurance provided the amount retained by the originating insurer shall be not less than 10 percent nor less than five hundred…
- § 6072 The restrictions imposed by this chapter upon any insurer as to original insurance shall apply to reinsurance written by it.
ARTICLE 7. Loss §§ 6090–6091 · 2 sections
- § 6090 Every member of such insurer who sustains loss by any hazard covered by his policy shall immediately notify the insurer in accordance with the terms of his…
- § 6091 An action may be brought and maintained against any such insurer by its members to recover for losses insured against by the insurer, if payment is withheld…
ARTICLE 8. Assessments §§ 7010–7018 · 10 sections
- § 7010 When any loss exceeds in amount the cash funds of the insurer and also exceeds one-eighth of one per cent of the total amount of the insurer’s insurance in…
- § 7011 Upon being convened for the purpose, the directors shall make an assessment upon all of the property insured in the insurer. Such assessment shall be in…
- § 7012 When the amount of such loss does not exceed one-eighth of one per cent of the total amount of insurance in force in the insurer, its directors may, by…
- § 7013 The term of any such loan shall not be greater than twelve months nor shall the date of maturity be in excess of thirty days beyond the date of the next annual…
- § 7014 The board of directors may at its annual meeting levy an assessment not to exceed twenty-five cents on the $100 of the first class of insurance and a pro rata…
- § 7015 (a) No assessment or assessments may be levied upon any policy in excess of three times the amount of the premium named therein. The liability to assessment on…
- § 7015.5 The commissioner shall charge and collect in advance a fee of one hundred seventy-seven dollars ($177) for issuing a certificate under this article, or for…
- § 7016 The secretary, whenever such an assessment is made, shall immediately notify every policyholder in such insurer either personally, by agent, or by letter…
- § 7017 The insurer may bring an action against any member who neglects or refuses to pay an assessment made upon him under the provisions of this chapter, or to pay…
- § 7018 A director of any such insurer who wilfully refuses or neglects to perform the duties imposed upon him by law or by the insurer’s by-laws shall be liable in…
ARTICLE 9. Reports and Statements §§ 7030–7031 · 2 sections
- § 7030 The secretary shall prepare an annual statement, showing the condition of such insurer on December thirty-first preceding the annual meeting. He shall present…
- § 7031 The president and secretary shall, on or before the first day of March of each year, prepare, under oath, and transmit to the commissioner a statement of the…
ARTICLE 9.5. Merger §§ 7040–7044.5 · 6 sections
- § 7040 Notwithstanding the provisions of Section 900 of the Corporations Code, any two or more of such insurers may merge. The plan and agreement by which any such…
- § 7041 When any such plan and agreement shall have been approved by the commissioner, with changes, if any required by him, the same shall be approved by a vote of…
- § 7042 If the vote is in the affirmative a certified copy of all proceedings relating to the proposed merger shall be filed with the commissioner. If the commissioner…
- § 7043 After any merger made under the provisions of this article shall have been completed, the surviving corporation shall be deemed, for the purpose of the…
- § 7044 Any plan of merger under this article shall provide that all rights and properties of the parties to the plan of merger shall accrue to and become the rights…
- § 7044.5 Any one or more county mutual fire insurers, by following the procedure of this article, may merge into a general mutual insurer described in Chapter 4…
ARTICLE 9.6. Transformation §§ 7045–7049 · 5 sections
- § 7045 The board of directors of any county mutual fire insurer that desires to commence proceedings for transformation of that insurer to a general mutual insurer…
- § 7046 After the commissioner has granted tentative approval of any such application, a county mutual fire insurer that shall meet the financial requirements…
- § 7047 The meeting called for the purpose of transformation, shall be preceded by a written or printed notice of the meeting and its purpose addressed to each…
- § 7048 Such corporation shall be a continuance of the original corporation by the same name or by any other name approved by the commissioner. Such transformation,…
- § 7049 After the policyholders have elected such a transformation a county mutual insurer shall submit to the insurance commissioner for final approval of the…
ARTICLE 10. Dissolution § 7050 · 1 section
- § 7050 Any such insurer may be proceeded against and dissolved in the same manner and upon the same conditions as in the case of other domestic incorporated insurers.
ARTICLE 11. Exemptions § 7060 · 1 section
- § 7060 The provisions of subdivision (f) of Section 381 and the provisions of Sections 382, 383, 384, 750, 751, 752, 753, 754, 755, 756, 757, 758,