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 persons agreeing to:

(a) Secure fire insurance from such insurer when organized through policies to be issued by such insurer having face amounts aggregating one million five hundred thousand dollars ($1,500,000) or more covering their property of the same or greater value. Such insurer shall retain net of reinsurance aggregate amounts on such policies at least equal to such amount.

(b) Pay the premium for such insurance immediately upon notification by such insurer that it is prepared to issue such policies providing such insurance.

(c) Pay to the insurer immediately upon its incorporation a special deposit of at least one dollar ($1) on each one hundred dollars ($100) of insurance applied for under (a) above, such special deposit to be applied to future premiums payable by such persons either after the expiration of three years or upon the commissioner determining that the insurer has a surplus earned by insurance operations in the amount of at least fifteen thousand dollars ($15,000), whichever occurs first.

(Amended by Stats. 1955, Ch. 1250.)