Selection and removal of directors and officers of mutuals.

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  • (1) The articles or bylaws of a mutual shall state:
    • (a) the number of directors of the mutual including the directors that are:
      • (i) appointed as public directors under this Subsection (1) and Subsection (2); or
      • (ii) elected under Subsection (3);
    • (b) the number of directors of the mutual that may be appointed as public directors; and
    • (c) the plan that specifies the manner in which:
      • (i) a public director is to be appointed; and
      • (ii) a director who is not a public director is to be elected.
  • (2)
    • (a) The plan for the appointment of public directors specified in Subsection (1) shall assure true public representation on the board.
    • (b) A person appointed as a public director shall have insurance business or other business or professional experience that qualifies that person to serve responsibly and impartially as a director.
    • (c) A public director may be an uncompensated member of the board of directors.
    • (d) Notwithstanding Subsection (2)(c), a public director shall meet the qualifications of Subsection (2)(b).
  • (3)
    • (a) A director who is not a public director shall be elected by:
      • (i) the policyholders; or
      • (ii) voting members.
    • (b) If the directors who are not public directors are divided into classes, one class shall be elected:
      • (i) at least every four years; and
      • (ii) for a term not exceeding six years.
  • (4) A director may be removed from office for cause by an affirmative vote of a majority of the full board at a meeting of the board called for that purpose.
  • (5) Subject to Subsections (1) through (4), Section 16-6a-810 applies to vacancies on the governing board.




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