(a) A home protection company which has issued or renewed an aggregate number of 1,000 or less contracts in the preceding calendar year shall maintain a minimum net worth of forty thousand dollars ($40,000) and for each additional 500 contracts, or fraction thereof, up to 10,000 contracts, an additional twenty thousand dollars ($20,000).

(b) Net worth is defined as the excess of admitted assets over all liabilities and required reserves. At least twenty thousand dollars ($20,000) of net worth shall consist of paid-in capital.

Terms Used In California Insurance Code 12750

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Home protection company: means any person licensed pursuant to this part which issues home protection contracts. See California Insurance Code 12740
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.

(Amended by Stats. 1981, Ch. 820, Sec. 5.)