(a) A domestic mutual insurer may reinsure all or substantially all of its insurance in force, or a major class thereof, with another insurer, stock or mutual, by an agreement of assumption reinsurance after compliance with this section. The agreement shall not become effective unless filed with the Insurance Commissioner and approved by him or her in writing after a hearing thereon. With regard to proposed transactions between a domestic mutual insurer which is a subsidiary or affiliate of a depository institution, and another insurer, the hearing shall be concluded and the order issued within the period required by federal law, and the order shall be final upon entry.
(b) The commissioner shall approve the agreement within a reasonable time after filing if he or she finds it to be fair and equitable to each domestic insurer involved and that the reinsurance if effectuated would not substantially reduce the protection or service to its policyholders. If the commissioner does not so approve, he or she shall so notify each insurer involved in writing specifying his or her reasons therefor.
(c) The plan and agreement for the reinsurance must be approved by vote not less than two-thirds (2/3) of each domestic mutual insurer's members voting thereon at meetings of members called for the purpose, pursuant to such reasonable notice and procedure as the commissioner may approve. If a life insurer, the right to vote may be limited to members whose policies are other than term or group policies and have been in effect for more than one (1) year.
(d) If for reinsurance of a mutual insurer in a stock insurer, the agreement must provide for payment in cash to each member of the insurer entitled thereto as upon conversion of the insurer pursuant to § 23-69-141, of his or her equity in the business reinsured as determined under a fair formula approved by the commissioner, which equity shall be based upon the member's equity in the reserves, assets whether or not they are admitted assets, and surplus, if any, of the mutual insurer to be taken over by the stock insurer.